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Actuaries do not always attempt to predict aggregate future events. Often, their work may relate to determining the cost of financial liabilities that have already occurred, called retrospective reinsurance, [25] or the development or re-pricing of new products. [26] Actuaries also design and maintain products and systems.
Another example is the use of actuarial models to assess the risk of sex offense recidivism. Actuarial models and associated tables, such as the MnSOST-R, Static-99, and SORAG, have been used since the late 1990s to determine the likelihood that a sex offender will re-offend and thus whether he or she should be institutionalized or set free. [9]
"That means that if Medicare paid an additional $129,000 to treat a group of patients, on average, group members would get one more quality-adjusted life year." [ 51 ] In risk management activities such as in the areas of workplace safety , and insurance, it is often useful to put a precise economic value on a given life.
That means if you make $50,000 a year, you should save $500,000 to $600,000 for retirement. This kind of saving can give you a good platform on which to retire.
Robert Brokamp: So let's use the tool to look at the potential longevity of a non smoking, 65-year-old married heterosexual couple in average health. So according to the tool, the average life ...
With determining life expectancy, age is the most important factor, other significant factors are sex of the individual and smoking. Thus, an actuary can reasonably estimate the average age of death for a group of 25-year-old males, who don't smoke. [2]
Year 3: $150,000 × (1.08) −3 = $119,074.84. If we sum the discounted expected claims over all years in which a claim could be experienced, we have completed the computation of Actuarial Reserves. In the above example, if there were no expected future claims after year 3, our computation would give Actuarial Reserves of $568,320.38.
Keeping the total payment per year equal to 1, the longer the period, the smaller the present value is due to two effects: The payments are made on average half a period later than in the continuous case. There is no proportional payment for the time in the period of death, i.e. a "loss" of payment for on average half a period.