Elements of compound interest, accumulated value and present value-nominal and effective rates of interest – immediate annuities certain and deferred annuities certain – perpetuities – functions included in compound interest tables and their uses.
Redemption of loans – Sinking funds – average interest yield on the fund of a life office. Elementary theory of profitability – mortality table – concept of stationary population – expectation of life – select rates.
General nature construction, characteristics and uses of mortality tables, mortality of Indian assured lives - Premiums – General principles – natural premiums – level premiums – net premiums – office premiums – loading for expenses with profit and without profit premiums – adequacy of premiums and relative consistency – use of commutation function in finding values of premiums and assurance benefits.
Life office valuations – general principles – policy values – retrospective and prospective methods of valuation of liabilities – different methods of valuation – concept of estate and trading profit special reserves and adjustments in the valuation – sources of surplus – methods of distribution of surplus.