Revolutionary Developments Between 1750 and 1810
The second half of the eighteenth century was a remarkable period of development for both probability (and statistics) and actuarial thought (and practice) more broadly. Two fundamentally important fields of statistical and actuarial thought emerged over the period that can each now be seen as a natural flowering of the seeds planted over the previous 100 years. First, a number of major theoretical breakthroughs were made that created the permanent foundations for the inversion of mathematical probability into inferential statistics. Second, the whole-of-life with-profit policy was conceived and successfully brought to market. This transformed life assurance from a short-term insurance contract into a long-term savings vehicle that strongly resonated with the emerging professional classes of late-Georgian Britain.
Over this period these two fields of mathematical statistics and actuarial science followed increasingly distinct paths of development: the primary application that drove statistical thinking over this period was found in the physical sciences, and especially astronomy, rather than finance; similarly, the success of new and more complex life assurance products meant that actuarial thinking and practice had to wrestle with a broader set of challenges than ‘just’ making good statistical estimates of mortality rates. One man, Richard Price, notably transcended both fields during this era, marking him as one of the most important historical figures in early actuarial history.
© The Author(s) 2017
C. Turnbull, A History of British Actuarial Thought, DOI 10.1007/978-3-319-33183-6_2