Annuity Profit Simulation
Document Type
Oral Presentation
Campus where you would like to present
Ellensburg
Event Website
https://digitalcommons.cwu.edu/source
Start Date
16-5-2019
End Date
16-5-2019
Abstract
We will present an R script for simulating a large number of whole life single annuity premiums prices for an insurance company, and to produce projected annual profits for the company. The program uses mortality data from the Society of Actuaries to create a life table which will calculate the annuity expected present value for given ages. The program accepts user input of a starting age range, maturity age, monthly annuity benefit, interest rate, number of policy holder lifetimes to generate, number of company years to simulate, and an ROI interest rate. Using the life table data and user input, the program creates a simulated number of policy holders’ lifetimes with random starting and death ages and their calculated premiums. This program also simulates a profit for a projected number of years to measure the insurance company’s annual profit. Several graphs and tables are produced to help illustrate these calculations. The calculations and design of this program were advised by Dr. Chin-Mei Chueh, actuarial science professor and Society of Actuaries council member, and Dr. Donald Davendra, computer science professor.
Recommended Citation
Hooper, Brian; McKinnon, Heather; and Kalla, Divya Chadrika, "Annuity Profit Simulation" (2019). Symposium Of University Research and Creative Expression (SOURCE). 191.
https://digitalcommons.cwu.edu/source/2019/Oralpres/191
Department/Program
Computer Science
Slides for SOURCE 2019 presentation McKinnon
Additional Files
hooper_annuity_calculator.pptx (1030 kB)Slides for SOURCE 2019 presentation McKinnon
Annuity Profit Simulation
Ellensburg
We will present an R script for simulating a large number of whole life single annuity premiums prices for an insurance company, and to produce projected annual profits for the company. The program uses mortality data from the Society of Actuaries to create a life table which will calculate the annuity expected present value for given ages. The program accepts user input of a starting age range, maturity age, monthly annuity benefit, interest rate, number of policy holder lifetimes to generate, number of company years to simulate, and an ROI interest rate. Using the life table data and user input, the program creates a simulated number of policy holders’ lifetimes with random starting and death ages and their calculated premiums. This program also simulates a profit for a projected number of years to measure the insurance company’s annual profit. Several graphs and tables are produced to help illustrate these calculations. The calculations and design of this program were advised by Dr. Chin-Mei Chueh, actuarial science professor and Society of Actuaries council member, and Dr. Donald Davendra, computer science professor.
https://digitalcommons.cwu.edu/source/2019/Oralpres/191
Faculty Mentor(s)
Donald Davendra