Insurance mathematics is about working out what an insurer pays and what the policyholder pays under stated policy conditions. This section has four lessons and a practice set, and sits within the SPM Mathematics guide.
What does this section cover?
Begin with interpreting premium, deductible and co-insurance in exam data, which gives you the vocabulary. Then calculate a claim using stated policy conditions, where order matters.
Next, distinguish life and general insurance in curriculum examples. The last lesson is checking under-insurance calculations with supplied formulas. The practice set mixes all four.
One house policy, four different questions
A worked example: a house is valued at RM300 000 and insured for RM180 000. The policy has an 80% co-insurance condition and a yearly premium of RM1 200.
| Question | What to notice | Skill |
|---|---|---|
| What is the monthly premium? | Divide the yearly premium by 12 | Premium |
| What does the policy cover, a death benefit or property loss? | Payout tied to a loss of value | General insurance |
| The house needs RM40 000 of repairs | Insured amount is below 80% × value | Under-insurance |
| What share of the loss is paid? | 180 000 ÷ 240 000 = 3/4 | Claim: RM30 000 |
Four questions, one policy, four different steps. The skill is knowing which step the wording asks for.
Who should start where?
If the vocabulary is new, start with the first lesson and read the terms aloud. If you know the terms but lose marks on claims, go to the second and third lessons.
If your answers are close but the order of conditions trips you, go straight to the under-insurance lesson, then the practice set. Percentage work underneath is the same as in taxation mathematics, so a gap there will show up here too.
How do the parts connect?
Premium comes first because it is what the policyholder pays. A claim follows an event and depends on the stated conditions. Life and general insurance decide which kind of payout the question describes. Under-insurance is the most demanding case, because it combines a condition, a ratio and the loss.
Logging your slips in the mistake log tool shows which of the four skills needs another pass.
If insurance questions still cost you marks, a teacher in one-to-one Mathematics tuition can go through policy wording with you, one question at a time.