Abstract
Insurance mathematics is concerned with the valuation of obligations arising from insurance contracts. At contract initiation, valuation is known as premium determination or ratemaking, whereas, for a contract already in force, valuation is known as reserve determination. Updating these values as information is revealed involves important techniques known as experience adjustment. Models of insurance mathematics are based on probability theory and financial economics. These models are calibrated with insurance experience and present values from returns on investments in asset markets.
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© 2018 Macmillan Publishers Ltd.
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Hickman, J.C., Frees, E.W. (2018). Insurance Mathematics. In: The New Palgrave Dictionary of Economics. Palgrave Macmillan, London. https://doi.org/10.1057/978-1-349-95189-5_2288
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DOI: https://doi.org/10.1057/978-1-349-95189-5_2288
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Publisher Name: Palgrave Macmillan, London
Print ISBN: 978-1-349-95188-8
Online ISBN: 978-1-349-95189-5
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