Financial and insurance mathematics is taught jointly by the School of Mathematical Sciences and the Faculty of Business and Economics, to ensure students develop high-level technical and analytical skills that are applicable in the workplace. Experts in this area use mathematical and statistical techniques to understand and assess risk in insurance and financial markets. Like actuaries, they determine the likelihood of specific outcomes and develop strategies that allow businesses and governments to either pursue new business opportunities or insure against risks.
The extended major in financial and insurance mathematics was introduced at Monash University in response to the national and international shortage of skilled workers in the finance and insurance industries, most notably workers with a rigorous mathematical training.
Financial and insurance mathematics is tailored to prepare students for working in the banking industry, investment firms, insurance companies, and in risk-management roles. However, like other mathematics graduates, they may also work for the Australian Bureau of Statistics, the Commonwealth Scientific, Industrial and Research Organisation (CSIRO), or in business analyst roles, universities, or management consultancy.
Financial and insurance mathematics is listed in S2000 Bachelor of Science, S3001 Bachelor of Science Advanced - Global Challenges (Honours) and S3002 Bachelor of Science Advanced - Research (Honours) at Clayton as an extended major.
In addition to achieving the broad outcomes of their course, students successfully completing this extended major will be able to:
- display basic knowledge and key technical skills in advanced calculus and linear algebra as well as high-level knowledge of and skills in the important techniques, terminology and processes of probability, statistics and stochastic processes as appropriate to financial and insurance mathematics;
- develop, apply, integrate and generate knowledge through abstraction and insight, and use high-level critical thinking skills to analyse, use and interpret the mathematics that arises across a range of problems in financial and insurance mathematics, including financial and risk models;
- demonstrate skills in the written presentation of a mathematical argument that enable mathematical, financial and insurance concepts, processes and results to be communicated effectively to diverse audiences.
Extended major requirements (72 points)
12 points at level 1 and at least 36 points at level 3.
- One level 1 science sequence (12 points) from the following:
- MTH1030 Techniques for modelling and STA1010 Statistical methods for science
- MTH1030 Techniques for modelling and MTH2010 Multivariable calculus
Note 1: Students studying the double degree E3007 Bachelor of Engineering (Honours) and Bachelor of Science must replace MTH1030 with ENG1005 and replace MTH2010 with ENG2005.
Note 2: Students with a strong mathematics background and an interest in the subject could replace the units MTH1030 and/or MTH2010 with their advanced versions MTH1035 and/or MTH2015 respectively. Students will need to seek permission to enrol in these units at the Science Student ServicesScience Student Services (http://www.monash.edu/science/current/undergraduate/help) office.
- The following three units (18 points):
- MTH2010 Multivariable calculus or MTH2015 Multivariable calculus (advanced)
- MTH2222 Mathematics of uncertainty
- MTH2232 Mathematical statistics
Note 3: If MTH2010 or MTH2015 was completed as part of the level 1 science sequence, replace it with a unit from the list under d.
Note 4: Students studying the double degree E3007 Bachelor of Engineering (Honours) and Bachelor of Science must replace MTH2010 with ENG2005.
- The following six units (36 points):
- ETC3400 Principles of econometrics
- ETC3420 Applied insurance methods
- MTH3230 Time series and random processes in linear systems
- MTH3241 Random processes in the sciences and engineering
- MTH3251 Financial mathematics
- MTH3260 Statistics of stochastic processes
- One additional unit (6 points) from the following:
- ETC2410 Introductory econometrics
- ETC3460 Financial econometrics
- ETC3530 Contingencies in insurance and pensions
- MTH2021 Linear algebra with applications or MTH2025 Linear algebra (advanced)
- MTH2032 Differential equations with modelling
- MTH2051 Introduction to computational mathematics
- MTH2140 Real analysis or MTH3140 Real analysis
- MTH3011 Partial differential equations
- MTH3051 Introduction to computational mathematics
- MTH3060 Advanced ordinary differential equations
- MTH3320 Computational linear algebra
- MTH3330 Optimisation and operations research
Note 5: Students studying the double degree E3007 Bachelor of Engineering (Honours) and Bachelor of Science must replace MTH2032 with MTH2040.
Requirements for progressing to honours and other further studies
Students must meet the entry requirements for S3701 Bachelor of Science (Honours), M5021 Graduate Diploma of Health and Science Research or meet the progression requirements to the fourth year of S3002 Bachelor of Science Advanced - Research (Honours).
Students must also complete prerequisite study as per the intended discipline. Refer to the honours prerequisiteshonours prerequisites (http://www.monash.edu.au/pubs/2019handbooks/undergrad/science-honours-prerequisites.pdf) table.
Successful completion of this area of study can be counted towards meeting the requirements for the following single degrees:*
- S2000 Bachelor of Science
- S3001 Bachelor of Science Advanced - Global Challenges (Honours)
- S3002 Bachelor of Science Advanced - Research (Honours)
Successful completion of this area of study can be counted towards meeting the requirements for the Bachelor of Science component in the following double degrees:*
- B2023 Bachelor of Commerce and Bachelor of Science
- B2016 Bachelor of Commerce Specialist and Bachelor of Science
- D3005 Bachelor of Education (Honours) and Bachelor of Science
- E3007 Bachelor of Engineering (Honours) and Bachelor of Science
- C2003 Bachelor of Information Technology and Bachelor of Science
- L3007 Bachelor of Laws (Honours) and Bachelor of Science
- S2006 Bachelor of Science and Bachelor of Arts
- S2007 Bachelor of Science and Bachelor of Biomedical Science
- S2004 Bachelor of Science and Bachelor of Computer Science
- S2003 Bachelor of Science and Bachelor of Global Studies
- S2005 Bachelor of Science and Bachelor of Music