Abstract
Abstract Mortality constitutes one of the main causes of risk in a life insurance portfolio (or pension plan). Many risk factors contribute to determine the mortality in a portfolio. In particular, at an individual level, the insured's age has an important role. In this article, we first describe the features of a (period) life table which constitutes the basic tool to represent the age pattern of mortality, and the applications of life tables to the calculation of expected present values (or “actuarial values”) in life insurance. Next, we introduce the ideas underlying the projected life tables, meant as a tool to represent future mortality. Finally, we focus on randomness in the results of a life insurance portfolio (cash flows, profits, etc.), and the use of stochastic models.
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