April 2014

Teaching Matters: You Do Not Really Understand MLC Unless...

By Yvonne Chueh

I hadn’t taught the MLC (Models for Life Contingencies) course for seven years. Last year I taught it again as a three-quarter, 10 weeks per quarter, course sequence in the fall, winter, and spring. The class met three times each week for 50 minutes. Our university hosts an annual undergraduate research symposium in the middle of May, so I decided to have my MLC students present their MLC projects in that symposium. I suggested building MS Excel tools to demonstrate their understanding by showing them to their grandmothers ("You do not really understand something unless you can explain it to your grandmother." ~Albert Einstein), local senior citizens (for community service), or college students (for actuarial major recruitment).A common goal is for the MS Excel tools to introduce users on how the insurance premiums are symbolized, defined, analyzed, and calculated with user-friendly input buttons and analytical table summary with graphical report. This teaching idea came from “Teaching Critical Thinking Through Community Inquiries,” a research program funded by an NSF grant which I attended (the participating faculty earned CTF ‘Critical Thinking Fellow’ title later by engaging the class in case studies, debates, creative activities to cultivate critical thinking skills and practice). Hoping that this project idea may guide the MLC learners to connect the abstract actuarial symbols, hands-on Excel tools, communication skills, and future job success, I made it a part of my MLC course requirement.

Students first were amazed while struggling in the fall when encountering tpx, t|qx, big A’s and small a’s symbols hatted by fancy accents that define the random benefit payment streams and various types of probability and mortality rate models. After the inquiry-based happy quizzes, assignments, pre-tests, and mid-term tests, we covered most of the notations and conversion equations among the insurance and annuity products and tested them on the final exam. It was not easy for most students due to the lecture pace we ran, and not surprisingly I had a few unhappy students blaming happy quizzes for not helping enough, and claiming the final exam was too hard—even though that was a genius idea for inquiry-based MLC learning experience from my perspective.

In the winter quarter, while going over the loss variable and reserves, I asked the class to build the formula codes in the MS Excel tool they had learned in the previous 10 weeks. I sent the class my Excel worksheets for them to imitate and extend to other mortality tables and life products. The example worksheets seemed to do the magic by boosting the class confidence; the entire class quickly hit the ground running. We moved forward to the actuarial exam topics by problem solving and lectures, and by the end of the winter quarter, every student turned in a project abstract and first report introducing the premium/reserve calculator (in their MS Excel Workbook) and the research scope. I was pleased to see the complete spreadsheets with good designs.

The final exam week and the spring break were used for articulating the content, adding new applications, and fitting the reasonable time line. Those students who had similar research scopes and interests were teamed up to complement one another, however, those independent projects stayed as individual ones.

At the arrival of spring, the class had up to six weeks to revise and finalize their Excel tools and the interactive user input buttons, oral presentation slides, or poster design and printing, assuming normal course coverage for the MLC Exam. They rehearsed their presentations in class and received peer review two days before the SOURCE (Symposium of Undergraduate Research and Creative Expressions) Day. Most students created interactive user input buttons and dropdown boxes with generated graphical and numerical comparison reports across gender, smoking, policy types, strategies, etc. In our regional university, with a small class size, every student made the presentation at the 18th annual SOURCE1 symposium joining 702 other presenters giving 338 presentations. Examples of our MLC presenters and topics are as follows:

  • Vicky Dyer, “Insurance Premium Comparison among Different Countries”
  • Drew Heber, Andy Conaway, Dustin Nakamichi, and Jinlong Cheng, “Life Insurance Pricing”
  • Nathan Rindlisbacher, “Expressions for Life Insurance and Life Annuities and How They Are Related”
  • Samuel Guiles, “Is Deferment Period Protection Necessary?”
  • Alex Nesbitt, “Understanding the Breadth of Life Contingent Insurance Options”
  • Brian Robertson, “Excel Application for Insurance Reserves
  • Adam Blanar-Oviatt, Stacy Albrecht, “A Fresh Look at Washington State’s Guaranteed Education Tuition Program”
  • Sarah Flatebo, “Net Level Premium Application: A Look at Smokers Vs. Nonsmokers”

Every MLC project was required to have an associated Excel App to generate results. For example, Vicky Dyer, an actuarial science major and computer science minor, built a software application with interactive and intuitive graphical user interface and a database from the World Health Organization to compare the whole life insurance premiums for a list of 32 countries selected with contrasted HDI index from the World Health Organization. She also provided analytical analyses on the various country comparisons after the software demonstration with statistical methods. Without the Excel tool, such comparisons and graphical reports would not only be time consuming from repetition and manual processing of output, but also not readily reportable, reusable, or responding to immediate inquiries.

Although our actuarial science program is housed in the mathematics department, I judged presentations including those MLC topics with other judges in our business college, who participated in the Source Day competition. It was all about all-for-one and one-for-all MLC projects for student learning experience and communicating of the very fundamental (and perhaps hardest) Actuarial Science topics. For the software application developed and written by Vicky Dyer, you may contact Yvonne Chueh at chueh@cwu.edu.

Yvonne, Chueh, Ph.D., is professor and director of the actuarial science program at Central Washington University in Ellensburg, Wash. She can be reached at chueh@cwu.edu.

1 considered a “model of inclusiveness” as it “encourage and rewards innovative and entrepreneurial discovery, foster faculty/staff-student relationships, and contributes to whole student development.”