models for insurance
Bachelor of Commerce
Actuarial Studies a
What is actuarial studies? 1 Bachelor of Commerce graduate pathways 6
Majoring in actuarial studies 2 Honours 6
Specialist areas 2 Careers 7
Double majors 3 Professional accreditation 7
Sample course plan 3 Graduate study in actuarial studies 7
Focus on first year actuarial studies 5 Breadth in actuarial studies 8
“Actuarial studies at the University of Melbourne is
well recognised throughout the world by international
standards for Actuaries and by employers. I knew that
studying this degree at the University of Melbourne would
well equip me with the knowledge and skills to fuel my
career ambition as an Actuary or in the finance sector.
The course offers a wide range of opportunities
including competitions that add value to our learning
and opportunities to liaise with other similar minded
individuals both locally and globally. Being part of U21,
the University can support and promote its students to
follow their ambitions of studying overseas and gaining
industry exposure to enhance their future careers.
I have been able to embrace the university culture
and the graduate attributes such as academic
excellence, knowledge across disciplines, leaders in
communities and being active global citizens.”
Dinuka is currently undertaking a Bachelor of Commerce,
majoring in actuarial studies. He is also currently
working as a Business Banking Associate at NAB
The Melbourne Model
The Melbourne Model aims to produce graduates who are suited to the challenges of changing workplaces
in the twenty-first century and equip them with a range of abilities to enable them to engage with local and
global communities. The Melbourne Model is based on a core undergraduate degree, leading to one of
three post-degree options: a career, a graduate professional degree, or a research higher degree. Under the
Melbourne Model, students undertaking a New Generation undergraduate degree specialise by completing
a major in a specific discipline (depth), and gain knowledge across disciplines by taking subjects from outside
their core program (breadth).
What is actuarial studies?
The work of an actuary involves the assessment, evaluation and management of the financial risks
faced by individuals, companies and governments as they plan for the future. These risks vary
from an illness, disability or death to the effects of a cyclone, earthquake or major economic or
social change. The actuary’s work is based upon a multi-disciplinary background of mathematics,
statistics, demography, finance and economics.
As a result of this multi-disciplinary Five reasons to choose actuarial studies at Melbourne
background and their strong analytical
skills, actuaries serve as financial 1. Teaching excellence 3. Professional accreditation
advisers to a wide range of commercial The Centre is committed to the highest The University of Melbourne is one
organisations including life, general standards of teaching. You will be of only four universities in Australia to
and health insurance companies, taught by experts in their fields. The be fully accredited by the Australian
superannuation funds, banks, other approach to teaching balances the actuarial profession. As such, our
financial institutions and governments. theoretical and practical aspects students are on a fast track to a
In most cases they are asked to tackle a (one does not go without the other). professional actuarial qualification.
wide range of problems, most of which We devote significant resources to
involve some uncertainty about the future. teaching, for instance: all material 4. Strong industry links
online, qualified tutors and small Staff bring a wealth of industry
tutorial groups. experience to the program. Additionally,
leading practitioners contribute to the
2. Research excellence teaching of the program, exposing
The Centre is a leading international students to the latest developments
research group. Our teaching is in their fields.
research led so that our students
are exposed to current developments 5. Active Students’ Society
in the field. The Actuarial Students’ Society
provides support to students and
encouragement to enjoy university
life outside of studies.
“Choosing the Bachelor of
Commerce at the University of
Melbourne was the best decision
I could have made. I enjoy
every moment of my studies,
have made many friendships
among my classmates, and am
confident the skills I’ve developed
in my degree will be useful and
relevant to my employment upon
Shona completed the Bachelor of
Commerce (Honours) in 2009. She
majored in actuarial studies and
commenced a graduate position
with McKinsey & Company in 2010.
Shona was a Melbourne National
Scholar and went on to receive the
Commerce Honours Scholarship as
well as the Goldman Sachs JBWere
Final Year Scholarship.
Actuarial Studies 1
Majoring in actuarial studies
Students who complete a major in actuarial studies will have a firm grounding in the traditional
actuarial skill set of probability and statistics, financial mathematics, and life insurance mathematics.
Financial mathematics Life insurance mathematics Actuarial statistics
Studies in financial mathematics cover Studies in life insurance mathematics The analysis of actuarial statistics is
the basics of the theory of interest, involve building probability models of important in all areas of actuarial work,
investment mathematics and stochastic human mortality and morbidity, and perhaps most so in the field of general
models for asset returns. These skills combining these with a financial model insurance. General insurance refers to
are relevant to all actuaries and have in order to price and reserve for life any type of insurance that is not
wide applicability throughout the insurance policies. This is called the insurance on a human life and includes
financial sector. “valuation” of insurance policies, and common forms of insurance such as
is performed by all actuaries working motor vehicle insurance. Actuaries
First year Introduction to Actuarial in life insurance. It is also important calculate quantities such as premiums
Studies in superannuation, in which case the and the appropriate level of no claims
valuation is often undertaken by firms discount for different types of general
Second year Financial Mathematics I of consulting actuaries. insurance. Actuaries working in general
Financial Mathematics II insurance are usually employed either
Probability First year Introduction to Actuarial by general insurance companies or
Statistics Studies by firms of consulting actuaries.
Third year Financial Mathematics III Second year Financial Mathematics I First year Introduction to Actuarial
Models for Insurance Financial Mathematics II Studies
and Finance Probability
Second year Financial Mathematics I
plus advanced study at honours level Financial Mathematics II
Third year Actuarial Modelling I Probability
Third year Actuarial Modelling II
plus advanced study at honours level
2 Bachelor of Commerce
“The Bachelor of Commerce has definitely
enhanced my ability to think analytically and
numerically. On top of this, it has enhanced
my ability to think critically and to question
everything in life. I’m sure these indispensable
life skills have equipped me well for wherever
my career takes me.”
Zezan completed a Bachelor of Commerce
with a major in actuarial studies. He served
as President of the Actuarial Student Society
and was part of the winning team in the Citi
International Case Competition. He has been
offered a place as a Management Consultant
at the Boston Consulting Group.
Students choosing the actuarial major with the intention of pursuing full professional accreditation cannot complete a double major
in the Bachelor of Commerce.
Sample course plan
Introductory Accounting Reports Accelerated
Semester 1 Commerce elective
Microeconomics and Analysis Mathematics 1
Introductory Accounting Transactions Accelerated Introduction to
Macroeconomics and Analysis Mathematics 2 Actuarial Studies
Semester 1 Probability Financial Mathematics I Business Finance
Intermediate Breadth subject
Semester 2 Statistics Financial Mathematics II
Semester 1 Actuarial Modelling I Actuarial Modelling II Financial Mathematics III
Models for Insurance
Semester 2 Contingencies (double subject) Actuarial Statistics
Compulsory subjects Actuarial subjects Accounting subjects Finance subjects Breadth subjects
Commerce elective subjects
The above example shows how you can major in actuarial studies, meet honours entry and professional accreditation requirements.
Students pursuing accreditation in actuarial studies (defined as those students who successfully complete Actuarial Modelling I) are
not required to complete at least 75 breadth points (six subjects). However they must take at least 75 points outside the core program
including two mathematics subjects, probability and statistics.
Each subject is usually worth 12.5 points.
Actuarial Studies 3
“The Melbourne BCom is the only degree
available in Victoria that is fully accredited by
the Institute of Actuaries of Australia, and is
ranked as having the best university actuarial
studies program in Australia. I never had
a single reason to even consider another
university. Pursuing actuarial studies has been
a thoroughly challenging and invigorating
experience. Some of the mathematics
behind the models presented is incredible
– it is exciting to know that I am learning the
frameworks which real companies use to
assess their investment opportunities.”
Ben completed the Bachelor of Commerce
(Honours) in actuarial studies. He now works at
Taylor Fry Consulting Actuaries in Melbourne.
4 Bachelor of Commerce
The Basement Lecture Theatre
in the new Business and
Focus on first year actuarial studies
Subject name: Introduction to Actuarial Studies
Contact hours In actuarial practice, you are given Skills developed
3 hours per week, comprising 2 lectures a broad overview of the main areas You will develop your mathematical
and one tutorial of actuarial practice and the problems modelling skills and learn the techniques
faced by actuaries working in these required to price basic financial contracts.
Topics covered areas. You will be exposed to real You will also develop an awareness
The subject provides an introduction insurance and superannuation products of the environment in which actuaries
to four main areas of study: financial and will be able to perform calculations. operate and of the problems they face.
mathematics, demography (the study For example, from information given
of populations), actuarial practice, and on the UniSuper website (UniSuper is Assessment
the valuation of contingent payments. the superannuation fund for Australian The subject is assessed by a mid-
university staff), you can work out the semester test (10%), an end of semester
In financial mathematics, you will amount of superannuation benefits a exam (70%) and two assignments
learn about compound interest and person would receive on leaving the (10% each). The assignments are usually
how to place a value on payments to superannuation fund. computer based and are designed to
be made in the future – for example, test skills that cannot be examined in
how much money do we require now In contingent payments, you combine
ideas from financial mathematics, a traditional examination.
to make a payment of $1 million five
years from now? demography and probability theory to Please check the Course and Subject
place a value on a payment, or set of Handbook to confirm subject details.
In demography, you will learn about payments, to be made in the future.
human populations and the key For example, if a person retired from Teaching methods
factors of fertility and mortality. Using work at age 60 and wanted an income The subject is taught by a mixture
mathematical models of human of $50,000 throughout their remaining of lectures and tutorials. The lectures
mortality, you can answer questions lifetime, what sum of money should have a fairly formal structure, whilst
such as: what is the probability that an the person save before retirement to tutorial classes are much more
individual aged 25 will live to age 60? secure this income? interactive, where you are expected
to contribute to solving problems.
Actuarial Studies 5
Bachelor of Commerce graduate pathways
Upon completing your Bachelor of Commerce with a major in actuarial studies, there are a
number of graduate pathways to employment, further study and research.
Bachelor of Commerce Honours Graduate research degrees1
Duration: 3 years full time Duration: 1 year full time Duration: 2-3 years full time
Choose from the following Available in: accounting, finance, actuarial studies, The Graduate School of
major areas of study: economics, management or marketing or a combination Business and Economics
of two areas. offers a range of Masters by
> Accounting Research and PhD programs.
An honours year enables you to extend your knowledge
> Actuarial studies See www.gsbe.unimelb.edu.au
of your major or area of specialisation through higher level
> Business for more information.
honours subjects and by undertaking an independent
> Economics research thesis in a single area of study under the guidance
of an academic supervisor.
Graduate professional development degrees1
Duration: Generally 2 years full time
The Graduate School of Business and Economics offers a full suite of graduate business and
economics programs with an emphasis on career entry programs for recent graduates and
specialist education for professionals. Our expertise spans the fields of accounting, actuarial
studies, business and IT, economics, finance, human resource management, international
business and marketing. See www.gsbe.unimelb.edu.au for more information.
Graduate professional entry programs1
Duration: Generally 2-3 years full time
Title: Master of, unless otherwise specified:
Including: Engineering, Forest Ecosystem Science, Information Systems, Juris Doctor (Law),
Science (Management Science), Teaching, Urban Horticulture, Urban Planning.
See www.futurestudents.unimelb.edu.au for more information.
Melbourne Commerce graduates enjoy careers both locally and abroad in areas such as accounting services, finance, insurance
and superannuation services, banks, mining, manufacturing, utilities and transport services, business, management, advertising,
market research and statistical services, legal services, retail and wholesale, and computing and telecommunications services.
See www.bcom.unimelb.edu.au/pathways/careers.html for more information.
1 Selection into these programs is based on performance in an undergraduate degree and additional selection criteria may also apply.
Note this information indicates many but not all the possible pathways to graduate study.
An honours year provides an advanced producing some research into an area
knowledge of actuarial studies and the of actuarial science that has not been
opportunity to develop your research widely considered previously. Employers
and communication skills through either of actuarial graduates are becoming
a research essay or a set of research increasingly interested in students who
projects. can demonstrate an ability to learn, to
adapt to changing situations and to
The honours year also fulfils all the work well within a team. These skills
requirements for Associateship of the are all honed during the honours year.
Institute of Actuaries of Australia. In
this fourth year of study you will take To be eligible for entry to honours,
advanced coursework in the areas of students must satisfy the requirements
risk theory and financial mathematics. of the BCom degree and obtain a grade
Importantly you will also develop your of H2B (70%) in at least four level-3
business and academic writing skills actuarial studies subjects.
and your communication skills by
6 Bachelor of Commerce
Careers Professional accreditation Graduate study in actuarial
The fast-growing actuarial profession The Centre for Actuarial Studies is fully studies
provides employment opportunities accredited by the Institute of Actuaries
Career entry programs
throughout Australia and the world. of Australia (IAAust), which is the
There are currently over 1,500 qualified professional actuarial body in Australia. Master of Actuarial Science (from 2011)
actuaries in Australia. More than 25% This accreditation means that students This is a two year program designed
work in life insurance, where the actuarial can obtain exemption from Parts I to provide initial actuarial education for
profession has its foundations. Nearly and II of the IAAust professional graduates with a first degree that includes
20% work in superannuation, with the exams, leading to the designation a strong mathematical or statistical
remaining actuaries typically working Associate of the Institute of Actuaries component, for example commerce,
in general insurance, investment of Australia (AIAA). mathematics, physics or engineering).
management, asset consulting, The program enables students who
financial planning and in government. To qualify as an actuary, you must pass
perform at a sufficiently high level in
(or be exempt from) three parts of the
university subjects to receive exemption
Demand for qualified actuaries is growing professional accreditation as prescribed
from all of Part I of the professional
in health insurance, risk management by the IAAust. The first two parts can
actuarial examinations conducted by
and financial services. Actuaries also be undertaken as a part of the Bachelor
the Institute of Actuaries of Australia or
work in non-traditional areas, for example of Commerce (Honours) degree at the
from the corresponding examinations
information technology and public University of Melbourne.
of the Institute of Actuaries (UK).
infrastructure. In recent years actuaries
have played a growing role in banking If you complete relevant subjects at the
University of Melbourne, and perform Research higher degree programs
and finance. The analytical skills of
actuaries are seen as invaluable in sufficiently well, you will be recommended Master of Commerce in Actuarial Studies
banking activities including security for exemption from the corresponding This is a one year research degree
pricing, valuations linked to mergers subjects offered by the IAAust. Should you with no coursework component.
and acquisitions, project finance and receive exemption from all corresponding Candidates are assessed on the basis
also the development of enterprise risk subjects you will be exempt from both of their research thesis. The degree is
management programs. Part I and Part II by the end of your primarily aimed at honours graduates
honours degree. If you do not obtain from the disciplines of actuarial studies,
Typically, a newly qualified actuary would the mark needed to achieve exemption financial mathematics, mathematics
earn around $95,000-$110,000 per you do not need to repeat the subject. As and statistics.
annum, with at least an $11,000 increase long as you achieve a pass mark or above
per year for several years. More senior, the subject will still be credited towards PhD in Actuarial Studies
experienced professionals would earn your Bachelor of Commerce degree. This is a three year research degree
in the vicinity of $200,000 per annum. with no coursework component.
Part III of the professional accreditation
is set by the Institute of Actuaries of Candidates are assessed on the basis
Career examples for actuarial
Australia. These examinations are held of their research thesis. The degree is
studies graduates primarily aimed at honours or masters
in May and October each year and are
> Banking and finance graduates from the disciplines of
undertaken after you graduate, while you
> Capital and risk management are working full time. actuarial studies, financial mathematics,
mathematics and statistics.
> Financial planning (retail) The length of time taken to qualify varies
> Financial reporting and from student to student. The qualification
performance management can be achieved in a minimum of five
> General insurance years, but the average time to gain full
accreditation is between seven and eight
> Health insurance
years (including completion of the four year
> Investments/asset management Bachelor of Commerce (Honours) degree.
> Life insurance: product pricing,
design and distribution
Overseas actuarial bodies give recognition
> Superannuation for the qualification of Fellow of the
> Valuation of insurance liabilities Institute of Actuaries of Australia, subject
and financial instruments to some supplementary training. There
is also partial recognition for exams
Source: Institute of Actuaries of Australia
passed (or obtained through
and Graduate Destinations Survey,
University of Melbourne
exemptions) under the IAAust.
Actuarial Studies 7
Breadth in actuarial studies
One of the cornerstones of the New Generation undergraduate degrees is the opportunity for all students to take subjects from
outside their major area of study. The breadth component enables you to tap into other bodies of knowledge, methods of enquiry
and personal and professional skills. Students in the Bachelor of Arts, Biomedicine, Environments, Music or Science may take
breadth subjects in actuarial studies.
Actuarial studies provides complementary breadth to students who are taking mathematically based subjects as their major
area of study. The following sequences of subjects are available only to students who have completed two first year mathematics
subjects and second year subjects in probability and statistics. Completion of these mathematics subjects usually requires VCE
Units 3&4 Mathematical Methods (either), with a minimum study score of 25 and Specialist Mathematics, with a minimum study
score of 27 (or equivalent).
Depending on the structure of your degree and subject to prerequisites, you can complete one of the following breadth sequences
in actuarial studies:
Actuarial statistics Financial mathematics
Learn how to apply techniques from probability and Learn how to apply mathematical techniques to a range of
statistics to problems in areas including financial modelling, financial problems, including personal financial problems and
life insurance and general insurance. analysing financial instruments such as bonds and shares.
First year Introduction to Actuarial Studies First year Introduction to Actuarial Studies
Second year Financial Mathematics I Second year Financial Mathematics I
Financial Mathematics II Financial Mathematics II
Third year Actuarial Modelling II Third year Financial Mathematics III
Actuarial Statistics Models for Insurance and Finance
Introductory financial mathematics Life insurance mathematics
Learn the basics of financial mathematics, including how Learn the techniques required to build models of human
money accumulates and techniques for analysing instruments mortality, analyse life insurance data, and price life insurance
such as home loans. contracts.
First year Introduction to Actuarial Studies First year Introduction to Actuarial Studies
Second year Financial Mathematics I Second year Financial Mathematics I
Financial Mathematics II Financial Mathematics II
Third year – Third year Actuarial Modelling I
Contingencies (double subject)
Sandhya is currently in her first year
of the Bachelor of Commerce majoring
in actuarial studies. Sandhya was one
of the two inaugural recipients of the
Commerce Opportunity Bursary.
8 Bachelor of Commerce
Actuarial Studies 9
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