Actuarial Service

DEFINITION of 'Actuarial Service'

Method by which corporations determine, assess and plan for the financial impact of risk. Actuaries use mathematical and statistical models to evaluate risk in the insurance and finance industries. In addition to mathematical and statistical methods, actuaries call upon other fields including probability, finance, economics and computer programming to create actuarial models. Actuarial science is used to evaluate and predict future payouts for insurance and other financial industries such as the pension industry.

BREAKING DOWN 'Actuarial Service'

Actuarial services include the analysis of rates of disability, morbidity, mortality, retirement, survivorship and other contingencies. By using mathematical and statistical modeling, actuaries are able to provide estimates regarding particular events, such as the life span of a life insurance applicant, or the likelihood of a catastrophic, weather-related event for a property and casualty insurance firm. Actuarial services forecast risk and uncertainty and help firms plan for future probabilities and possibilities.