ACSC 533 Lecture Notes - Lecture 17: Reinsurance, Disability Insurance, Small Claims Court
20 Mar 2018
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Document Summary
The work that casualty actuaries perform does differ significantly from the work of most life actuaries. Specifically with respect to the range of associated risks. And loss distributions by size also differ in the casualty area of practice, from what is usually seen in the others. Some casualty products are characterized by many relatively small claims (such as damages to personal vehicles) Other casualty products experience many small claims and a few very large (extreme) claims. Think of the casualty claims due to 9/11, hurricane katrina, 2007 wildfires in greece, 2013 floods in western canada, lac-megantic derailment, fort mcmurray fires in 2016, etc. Actuaries work with size of loss distributions to estimate the effect of policy limits and deductibles. Size of loss distributions are used both in pricing reinsurance, and in determining how. Insurance companies buy reinsurance, ie insurance on insurance, to protect themselves much reinsurance should be purchased by a company.
