|
Reinsurance Actuarial Premium
Actuarial reinsurance premium calculation uses the similar mathematical tools as actuarial insurance premium. Nevertheless, Catastrophe modeling, Systematic risk or risk aggregation statistics tools are more important. Burning cost Typically burning cost is the estimated cost of claims in the forthcoming insurance period, calculated from previous years' experience adjusted for changes in the numbers insured, the nature of cover and medical inflation. # Historical (aggregate) data extraction # Adjustments to obtain 'as if' data: ## present value adjustment using actuarial rate, prices index,... ## base insurance premium correction, ## underwriting policy evolution, # clauses application 'as if' data, calcul of the 'as if' historical reinsurance indemnity, # Reinsurance pure premium rate computing, # add charges, taxes and reduction of treaty "As if" data involves the recalculation of prior years of loss experience to demonstrate what the underwriting results of a particular progr ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Catastrophe Modeling
Catastrophe modeling (also known as cat modeling) is the process of using computer-assisted calculations to estimate the losses that could be sustained due to a catastrophic event such as a hurricane or earthquake. Cat modeling is especially applicable to analyzing risks in the insurance industry and is at the confluence of actuarial science, engineering, meteorology, and seismology. Catastrophes/ Perils Natural catastrophes (sometimes referred to as "nat cat") that are modeled include: * Hurricane (main peril is wind damage; some models can also include storm surge and rainfall) * Earthquake (main peril is ground shaking; some models can also include tsunami, fire following earthquakes, liquefaction, landslide, and sprinkler leakage damage) * severe thunderstorm or severe convective storms (main sub-perils are tornado, straight-line winds and hail) * Flood * Extratropical cyclone (commonly referred to as European windstorm) * Wildfire * Winter storm Human catastrophes inclu ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Systematic Risk
In finance and economics, systematic risk (in economics often called aggregate risk or undiversifiable risk) is vulnerability to events which affect aggregate outcomes such as broad market returns, total economy-wide resource holdings, or aggregate income. In many contexts, events like earthquakes, epidemics and major weather catastrophes pose aggregate risks that affect not only the distribution but also the total amount of resources. That is why it is also known as contingent risk, unplanned risk or risk events. If every possible outcome of a stochastic economic process is characterized by the same aggregate result (but potentially different distributional outcomes), the process then has no aggregate risk. Properties Systematic or aggregate risk arises from market structure or dynamics which produce shocks or uncertainty faced by all agents in the market; such shocks could arise from government policy, international economic forces, or acts of nature. In contrast, specific ris ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Reinsurance
Reinsurance is insurance that an insurance company purchases from another insurance company to insulate itself (at least in part) from the risk of a major claims event. With reinsurance, the company passes on ("cedes") some part of its own insurance liabilities to the other insurance company. The company that purchases the reinsurance policy is referred to as the "ceding company" or "cedent". The company issuing the reinsurance policy is referred to as the "reinsurer". In the classic case, reinsurance allows insurance companies to remain Solvency, solvent after major claims events, such as major disasters like hurricanes or wildfires. In addition to its basic role in risk management, reinsurance is sometimes used to reduce the ceding company's capital requirements, or for tax mitigation or other purposes. The reinsurer may be either a specialist reinsurance company, which only undertakes reinsurance business, or another insurance company. Insurance companies that accept reinsur ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Insurance
Insurance is a means of protection from financial loss in which, in exchange for a fee, a party agrees to compensate another party in the event of a certain loss, damage, or injury. It is a form of risk management, primarily used to protect against the risk of a contingent or uncertain loss. An entity which provides insurance is known as an insurer, insurance company, insurance carrier, or underwriter. A person or entity who buys insurance is known as a policyholder, while a person or entity covered under the policy is called an insured. The insurance transaction involves the policyholder assuming a guaranteed, known, and relatively small loss in the form of a payment to the insurer (a premium) in exchange for the insurer's promise to compensate the insured in the event of a covered loss. The loss may or may not be financial, but it must be reducible to financial terms. Furthermore, it usually involves something in which the insured has an insurable interest established by o ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Actuarial Science
Actuarial science is the discipline that applies mathematics, mathematical and statistics, statistical methods to Risk assessment, assess risk in insurance, pension, finance, investment and other industries and professions. Actuary, Actuaries are professionals trained in this discipline. In many countries, actuaries must demonstrate their competence by passing a series of rigorous professional examinations focused in fields such as probability and predictive analysis. Actuarial science includes a number of interrelated subjects, including mathematics, probability theory, statistics, finance, economics, financial accounting and computer science. Historically, actuarial science used deterministic models in the construction of tables and premiums. The science has gone through revolutionary changes since the 1980s due to the proliferation of high speed computers and the union of stochastic actuarial models with modern financial theory. Many universities have undergraduate and gradu ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Ruin Theory
In actuarial science and applied probability, ruin theory (sometimes risk theory or collective risk theory) uses mathematical models to describe an insurer's vulnerability to insolvency/ruin. In such models key quantities of interest are the probability of ruin, distribution of surplus immediately prior to ruin and deficit at time of ruin. Classical model The theoretical foundation of ruin theory, known as the Cramér–Lundberg model (or classical compound-Poisson risk model, classical risk process or Poisson risk process) was introduced in 1903 by the Swedish actuary Filip Lundberg. Lundberg's work was republished in the 1930s by Harald Cramér. The model describes an insurance company who experiences two opposing cash flows: incoming cash premiums and outgoing claims. Premiums arrive a constant rate ''c > 0'' from customers and claims arrive according to a Poisson process N_t with intensity \lambda and are independent and identically distributed non-negative random variables ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Actuarial Science
Actuarial science is the discipline that applies mathematics, mathematical and statistics, statistical methods to Risk assessment, assess risk in insurance, pension, finance, investment and other industries and professions. Actuary, Actuaries are professionals trained in this discipline. In many countries, actuaries must demonstrate their competence by passing a series of rigorous professional examinations focused in fields such as probability and predictive analysis. Actuarial science includes a number of interrelated subjects, including mathematics, probability theory, statistics, finance, economics, financial accounting and computer science. Historically, actuarial science used deterministic models in the construction of tables and premiums. The science has gone through revolutionary changes since the 1980s due to the proliferation of high speed computers and the union of stochastic actuarial models with modern financial theory. Many universities have undergraduate and gradu ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
