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Actuary
Uses mathematics and statistics to assess financial risk for insurance and pension companies.
Did you know?
Edmond Halley, of Halley's Comet fame, built a life table in 1693 that helped price annuities and shaped actuarial science.
How subjects help
- Mathematics: Calculate how much a pension fund should save today to pay people for decades.
- Statistics: Use records of accidents and illnesses to predict how many insurance claims will come in.
- Economics: Factor in inflation and interest rates when pricing long term insurance.
- Computer Science: Write programs that run thousands of what if scenarios on insurance data.
A famous name
William Morgan: Welsh actuary of the Equitable Life from 1775 to 1830, seen as the father of modern actuarial science.
Try it yourself: Which dice total wins?
- Write the numbers 2 to 12 down the side of your paper. Guess which total will come up most and write your guess at the top.
- Roll both dice, add them, and put a tally mark next to that total. Do at least 36 rolls.
- Look at your tallies. Which total came up most? Which hardly ever?
- Now list every way two dice can make each total (a 7 can be 1+6, 2+5 and so on). Does the number of ways explain your results?
Statisticians and actuaries compare what actually happens with what probability predicts, which is how they price insurance, test medicines and spot when something unusual is going on.
Adapted from NRICH (University of Cambridge): A Bit of a Dicey Problem.
Also try: Would you invest in this business?.
Known for it in
USA, UK, Canada, Australia, Germany