Zhongyi Yuan

Color portrait of Zhongyi Yuan

Associate Professor

Department Risk Management
Office Address 362 Business Building
Phone Number 814-865-6211
Email Address zuy11@psu.edu

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Dr. Zhongyi Yuan is an Associate Professor of Risk Management and King Family Early Career Professor at Smeal College of Business.

Dr. Yuan is an Associate of the Society of Actuaries (ASA). He used to be a James Hickman scholar awarded by the Society of Actuaries (SOA).

Dr. Yuan's research focuses on catastrophe risk management, tail risk analysis, and insurance risk securitization. His research has been sponsored by the SOA and has appeared in leading actuarial journals, such as ASTIN Bulletin, European Actuarial Journal, Insurance: Mathematics and Economics, and North American Actuarial Journal, as well as leading journals in related fields, such as Extremes and European Journal of Operational Research.

Education

Ph.D., Statistics (Actuarial Science), The University of Iowa, 2013

M.S., Applied Mathematics (Financial Mathematics), Chinese Academy of Sciences, 2008

B.S., Computer Science, Beijing Normal University, 2004

Courses Taught

RM 422 – Short Term Actuarial Math Adv (3)
This course covers advanced topics of actuarial methods and concepts used to develop loss models for property and casualty insurance and health insurance. The course makes use of real world numerical examples in order to demonstrate how actuaries use historical claims and pricing data, both company specific and industry, to determine rates and increases. Topics covered include: 1) Interpretation and calculations with severity, frequency and aggregate models, 2) Construction and selection of parametric models, 3) Estimation of losses using credibility procedures, and 4) Pricing and reserving for short-term insurance coverages. The course helps to prepare actuarial students for the international Advanced Short-Term Actuarial Mathematics (ASTAM) actuarial exam.

RM 421 – Short Term Actuarial Math Fund (3)
RM 421 provides a solid understanding of actuarial methods and concepts used to develop loss models for property and casualty insurance and health insurance. The course makes use of real world numerical examples in order to demonstrate how actuaries use historical claims and pricing data, both company specific and industry, to determine rates and increases. Topics covered include: 1) Understand the key features of insurance and reinsurance coverages, 2) Understand the characteristics of severity, frequency and aggregate models, 3) Understand the concepts and applications of credibility theory, 4) Apply basic methods for calculation of premiums and reserves for short term insurance coverages. The course helps actuarial students to prepare for the international Fundamentals of Actuarial Mathematics (FAM) exam.

RM 412 – LONG TERM ACTUARIAL MATH ADV (3)
A study of joint-life and survivor-life functions, population life tables, and multiple decrement theory, with applications to disability and retirement problems. The course provides a solid understanding of the advanced topics in long-term actuarial mathematics, and helps actuarial students prepare for the Advanced Long-Term Actuarial Mathematics (ALTAM) actuarial exam. Topics covered include: 1) Key concepts of multiple state survival models, including calculations of premium and policy values, 2) Analysis of emerging surplus and apply profit testing principles, 3) Basic pension/retirement benefits, including accrual, valuation and funding calculations, and 4) Various equity-linked life insurance guarantees and options, including relevant pricing, reserving and hedging principles. Building on these topics, students will be able to apply theoretical concepts to real-world insurance problems using a project-based approach focused on one or more advanced topics covered in the course.

RM 420 – Prp Cslty Hlth Ins (3)
Actuarial methods and concepts used to develop manual rates for property and casualty insurance.

RM 410 – FIN MATH FOR ACTSC (3)
Compound interest and annuity functions; life annuities; equations of value; determination of yield rates; bonds; introduction to derivatives. R M 410 Financial Mathematics for Actuaries (3) The first section of the course focuses on Interest Theory, including compound interest, annuities- certain, and life annuities; equations of value; loans and their valuation; the pricing of bonds (with and without default), determining their yields to maturity and outstanding balances; determination of yield rates, spot rates, forward rates, and At-Par rates; duration of an asset or liability, and immunization of interest rate risk. The second section introduces students to derivatives, including the description, payoffs, and profits of forwards, futures, puts, calls, and swaps, and how to use them to manage a company's or investor's financial risks. The course helps prepare actuarial students for the international actuarial exam FM (Financial Mathematics).

R M 420 – Property, Casuality, and Health Insurance (3)
Actuarial methods and concepts used to model property, casualty and health insurance losses along with credibility theory.

R M 410 – Compound Interest and Annuities (3)
Compound interest and annuity functions; life annuities; equations of value; determination of yield rates; bonds; introduction to derivatives.

Selected Publications

Li H., Liu H., Tang Q., Yuan Z., "Pricing extreme mortality risk in the wake of the COVID-19 pandemic." Insurance: Mathematics and Economics, vol. 108, 2023, pp. 84--106
Shen C., Yuan Z., "A Hydro-EVT approach to flood insurance pricing." 2022, www.soa.org/resources/research-reports/2022/hydro-evt-flood-insurance/
Liu H., Tang Q., Yuan Z., "Indifference Pricing of Insurance-Linked Securities in a Multi-period Model." European Journal of Operational Research, vol. 289, 2021, pp. 793--805
Tang Q., Yuan Z., "Pricing CAT Bonds under a Product Probability Measure with POT Risk Characterization.." ASTIN Bulletin: The Journal of the IAA, vol. 49, 2019, pp. 457--490
Blanchet J. H., Lam H., Tang Q., Yuan Z., "Robust Actuarial Risk Analysis." North American Actuarial Journal, vol. 23, 2019, pp. 1--31
Ambrose B. W., Yuan Z., "Pricing Government Credit: A New Method for Determining Government Risk Exposure." Economic Policy Review, vol. 24, 2018, pp. 41--62
Yuan Z., "An Asymptotic Characterization of Hidden Tail Credit Risk with Actuarial Applications." European Actuarial Journal, vol. 7, 2017, pp. 165--192
Blanchet J. H., Lam H., Tang Q., Yuan Z., "Mitigating Extreme Risks through Securitization." 2017
Chen Y., Yuan Z., "A Revisit to Ruin Probabilities in the Presence of Heavy-tailed Insurance and Financial Risks." Insurance: Mathematics and Economics, vol. 73, 2017, pp. 75--81
Shi X., Tang Q., Yuan Z., "A Limit Distribution of Credit Portfolio Losses with Low Default Probabilities." Insurance: Mathematics and Economics, vol. 73, 2017, pp. 156--167
Tang Q., Yuan Z., "Random Difference Equations with Subexponential Innovations." Science China Mathematics, vol. 59, 2016, pp. 2411--2426
Blanchet J. H., Lam H., Tang Q., Yuan Z., "Applied Robust Performance Analysis for Actuarial Applications." 2016
Wei L., Yuan Z., "The Loss Given Default of a Low-Default Portfolio with Weak Contagion." Insurance: Mathematics and Economics, vol. 66, 2016, pp. 113--123
Tang Q., Yuan Z., "Interplay of Insurance and Financial Risks with Bivariate Regular Variation." 2015
Tang Q., Yuan Z., "Randomly Weighted Sums of Subexponential Random Variables with Application to Capital Allocation." Extremes, vol. 17, no. 3, 2014, pp. 467--493
Tang Q., Yuan Z., "Asymptotic Analysis of the Loss Given Default in the Presence of Multivariate Regular Variation." North American Actuarial Journal, vol. 17, no. 3, 2013, pp. 253--271
Funded by The Actuarial Foundation (TAF) and the Casualty Actuarial Society (CAS) through the 2012 Individual Grants Competition.
Tang Q., Yuan Z., "A Hybrid Estimate for the Finite-time Ruin Probability in a Bivariate Autoregressive Risk Model with Application to Portfolio Optimization." North American Actuarial Journal, vol. 16, no. 3, 2012, pp. 378--397
Funded by The Actuarial Foundation and the Society of Actuaries through the 2011 Individual Grants Competition.

Research Impact and Media Mention

"SOA Featured Research Projects", Catastrophe and Climate Research Program Newsletter, Newspaper, www.soa.org/4aa73d/globalassets/assets/files/resources/research-report/2022/2022-10-catastrophe-and-climate-newsletter.pdf

Editorships

Risks, Subject Matter Editor, (www.mdpi.com/journal/risks), November 2023 - Present
Guest editor for special issue on Tail Risk Analysis and Management
Journal of Systems Science and Complexity, Associate Editor, (www.springer.com/journal/11424), March 2020 - Present

Honors and Awards