Background and Goals: This course is designed to allow students to explore the insurance mechanism as a means of replacing uncertainty with certainty. A main goal of the course is to explain, using mathematical models from the theory of interest, risk theory, credibility theory and ruin theory, how mathematics underlies many important individual and societal problems.
Content: We will explore how much insurance affects the lives of students (automobile insurance, social security, health insurance, theft insurance) as well as the lives of other family members (retirements, life insurance, group insurance). While the mathematical models are important, an ability to articulate why the insurance options exist and how they satisfy the consumer's needs are equally important. In addition, there are different options available (e.g. in social insurance programs) that offer the opportunity of discussing alternative approaches.
Subsequent Courses: none