What Does Sample Mean?
A sample is a small selection drawn from a larger group that is supposed to represent the characteristics of that group.
Actuaries use samples of populations to gain insights into the larger populations and help them make informed decisions on behalf of insurance companies.
Insuranceopedia Explains Sample
Insights gained from analyzing samples can impact premium prices, policy lengths, deductible amounts, and many other aspects of insurance policies. A life insurance company might, for example, analyze a sample of 1,000 people with heart disease between the ages of 60 and 65 to come up with an informed estimate of how long a person in this condition is likely to live. The results could have an impact on premium rates, approval for policies, death benefits, and other factors.