This paper focuses on sections of the insurance industry which are not often widely discussed. If catastrophe insurances are to be transacted successfully, a large number of different technical skills and experiences must be combined. Actuaries in the U.K. are still relatively little employed on the problems of general insurance, and are rarely involved in the complexities of these particular sections of it. It must be recognized that there is only limited scope for the application of actuarial skills in this field. However, there may be some advantage to be gained by mixing an intelligent statistical opinion with other specialized technical or practical ones when some catastrophe problems are being discussed. Before expressing a view on any topic, it is, of course, essential to learn about the background and existing conditions.

The concept of catastrophe is considered in section 2 of this paper. Potential catastrophe situations can be classified into two groups, natural hazards and man-made hazards. Each of the sections 3–9 deals with one of the principal natural hazards, giving an outline of the causes of catastrophic events, the type of losses to be expected, and the form of insurance cover likely to be available in vulnerable areas. Section 10 describes the New Zealand state scheme, which provides cover in the event of extraordinary losses from nearly all elemental perils, and war. Sections 11–16 each deal with a different type of situation where a man-made catastrophe can occur, and the insurance provisions available in each case.

At the beginning of 1948 the Continuous Mortality Investigation was extended to pensioners who had retired under life office pension schemes. Thirty offices agreed to contribute data, which for the most part are derived from pension schemes issued as “group” business although data for pension schemes operated by means of individual contracts are also included.

The actuarial aspects of the liability of the employer towards his employees in respect of industrial accidents and diseases have not been discussed frequently at the Institute, and the comparatively small number of contributions to the Journal on this subject is doubtless to be attributed, in no small measure, to the difficulty of obtaining access to any considerable body of data bearing more particularly upon the duration of compensation claims. Some three or four Tears ago the author was asked to investigate the experience of a Colliery Owners' Mutual Indemnity Fund, and although the investigation deals with a single industry and relates to a period somewhat remote, it is hoped that, in so far as it may throw some light upon a subject regarding which but little information has as yet become available, the following account of the methods followed, and the results obtained, may nevertheless be of interest and possibly of some value. The author desires to express his indebtedness to the directors of the fund, which for certain reasons it is not desired to name, and which is hereafter referred to as “the Fund,” for their courteous permission to utilize in this manner information obtained in his professional capacity.

The application of sampling technique to statistical data, which a few decades ago was a rarity, has now become common practice. Our past President, Mr F. A. A. Menzler, in his presidential address said:

Sampling, in all its manifestations, has become almost a social and industrial routine. In this paper, by examining in some detail the application of sampling to a particular branch of actuarial work, namely pension fund valuations, an attempt is made to investigate the possibilities of its use in the actuarial-field. By the choice of pension fund valuations, which are a particularly complicated example of the actuarial technique, the investigation will, it is hoped, give a good insight into the sort of problems involved.

In this paper the reader is asked to watch the heuristic development of an idea and its implications.

The subject is the way in which the working of a life office is unaffected by changes in the market rate of interest. For this purpose all other questions such as mortality, expenses, etc., will be ignored as far as possible. The idea is that actuarially a life office is qualitatively different from the sum of its individual policies; that many of the difficulties in discussing this subject occur because basic actuarial concepts and techniques, especially

(i) the idea of an average rate of interest, and

(ii) the method of discounting into a present value,

which have been designed primarily to deal with the problems of individual policies, are inappropriate to the large-scale problems of a life office, e.g. valuation, investment and bonus declarations.

The heuristic development is that of an alternative theory and technique; these do not, for instance, make use of (i) and (ii) above.

It might at first be thought that this paper is limited to the problems of those few who hope to establish a new office in a highly organized and competitive life assurance market. Yet all offices wishing to expand will be faced with problems of a similar nature. This is evident when contemplating a development overseas and was the subject of a paper to the Faculty in March 1960 by R. G. Mallett (T.F.A.26, 547).

The two leading formulæ at present in use for interpolation by central differences are due to Newton‡ (Methodus Differentialis, Prop. III), though often called by the name of Stirling, who republished them about 20 years later.

It is not without some feeling of diffidence that a Paper on the results of an Investigation into the Mortality of Lives Assured with the Oriental Government Security Life Assurance Co., Ltd., conducted jointly by the Actuary, Mr. Douglas Forrest, F.F.A., and the author is submitted. The Journal is more or less barren of Papers relating to the Mortality of Native Indian Assured Lives, though the subject of Indian mortality has often been considered by members of this Institute. Reference might be made in this connection to the investigations of Messrs. S. C. Thomson (T.F.A., vol. i) and A. T. Winter (J.I.A., vol. xliii) on the subject of the Mortality of Indian Assured Lives, but these being based on scanty data, the results must always be accepted with caution. Mr. Arthur Hunter's contribution (J.I.A., vol. lvii) relating to the experience of the Lives Assured with the New York Life Insurance Company from 1885–1921, touches on several points of interest and sounds a strong note of pessimism as follows : “The Mortality among natives of India insured by “our Company has not improved in the later over the earlier “years of observation” and “it is difficult to conceive that the “great increase in knowledge and the improvements in “sanitation have not affected the health of the middle and the “upper classes of India in the same way as they have affected “other (tropical) countries (such as Cuba, Brazil, Chile and “Porto Rico), although possibly not to the same extent.”