What is the purpose of an "actuarial table"?

An actuarial table serves the specific function of calculating risk and life expectancy, which is critical in the fields of insurance and finance. These tables provide statistical data that help actuaries analyze and predict the likelihood of certain events occurring over time, such as mortality or morbidity rates. By using this data, insurers can assess the potential risk associated with providing coverage to individuals or groups and set appropriate premiums accordingly.

Actuaries utilize these tables to estimate future liabilities and ensure that the insurance company can meet its financial obligations. The precise calculations derived from actuarial tables contribute significantly to the overall soundness and strategic planning of an insurance firm's portfolio, making them an essential tool in risk assessment processes.