March 2015

Letter from the Editor

By Paul Ramirez

paul-ramierzCompAct newsletter is probably the way in which most Technology Section members are remaining in touch with the section. Keeping this in mind, I always want to stay connected with the section membership to ensure that the newsletter is providing value. Are the articles useful? Are there any topics that you would like to see covered in the newsletter? Our articles tend to be focused on technical discussions and developments. Would some information regarding the Technology Section activities be valued in the newsletter? Please feel free to send me any feedback, and as always, I encourage members who are considering writing an article to reach out and contact me at Now, on to the content!

In this issue of CompAct, we have some great content to help usher in 2015. To summarize this issue’s articles:

  • Data Structures and Algorithms, Part I
    This is the first in a series of articles written by Ben Kester giving an overview of some core computer science topics: data structures and algorithms. An overview of stacks and queues is provided, as well as an introduction to “Big O” notation, which is a measure of how an algorithm computation time increases relative to the size of the input data. This brings me back to my undergraduate computer science courses; I am very excited to see what topics Ben presents in his next article in the series!

    More Binomial Probability Calculations
    Roger Kaiser gives an in-depth look at how to calculate binomial probabilities. First, he provides insight into exactly how Excel calculates binomial probabilities. Then, he explains the multiplication method, which is a method for calculating binomial probabilities while minimizing loss from underflow or overflow. Finally, the accuracy of various calculation methods and approximations are summarized neatly.

    Actuarial Spreadsheets: Top 6 Danger List
    In this article, Dave Kester draws from his wealth of experience in creating actuarial spreadsheets and provides a list of dangers that he has previously seen. Sometimes, as actuaries we get caught up in trying to provide the answer as quickly as possible; this a good reminder that often it’s worth the time to take a step back and evaluate whether the spreadsheet or model can be improved upon to lessen the risk of future problems.

    Excel Spreadsheets—Best Practices
    This article provides a nice complement to Dave’s article. Andrew Chan provides some best practices to use in creating Excel spreadsheets and models (I am beginning to think us actuaries like Excel ). He covers such topics as automation, formula simplification, and how to manage data in Excel. 

 Paul Ramirez, FSA, MAAA, is a health actuary at Allstate Benefits. He can be reached at