Exam FAM Study Plan

Start with the syllabus map, then split preparation into two tracks: short-term insurance models and long-term contingent payments. Bring the tracks together only after each one has its own notation, formulas, and problem types under control.

A reasonable first pass is 10 to 12 weeks for a candidate with P and FM still fresh. Candidates with weak probability, statistics, or financial mathematics should add review time before starting timed FAM sets.

Refresh expectation, variance, conditioning, maximum likelihood, interest-rate notation, annuities, and equation-of-value work. FAM assumes this background, so weak fundamentals show up as slow errors later.

Read the notation note early. It tells you how FAM phrases deductibles, policy limits, accident years, calendar years, force of mortality, future lifetime, premiums, and policy values.

Work through coverage modifications, severity families, frequency families, aggregate losses, limited expected value, and stop-loss insurance. Do not separate formulas from payment variables: FAM asks what the insurer pays, what the reinsurer pays, and what the aggregate risk looks like.

Build a recognition sheet for Pareto, gamma, lognormal, Weibull, Poisson, binomial, negative binomial, geometric, and the (a,b,0) and (a,b,1) classes. Then connect those formulas to aggregate mean, variance, convolution, approximations, and risk measures.

Move to life tables, survival models, force of mortality, complete and curtate future lifetimes, present value random variables, annuities, insurances, premiums, and policy values.

The long-term side rewards notation discipline. Write down the random variable first, then the expected value, then the premium or policy value. If you skip the random variable, the formulas blur together.

Return to ratemaking and reserving after the short-term models are familiar. Expected loss ratio, chain-ladder, Bornhuetter-Ferguson, loss cost rates, loss ratio rates, trend, development, expenses, and profit loading all depend on clear definitions of loss and exposure.

For option pricing, stay focused on the FAM boundary: simple European puts and calls, one-step or multi-step binomial pricing, Black-Scholes formula use, delta hedge, and put-call parity.

Use the official sample questions as a diagnostic, not as a script to memorize. The short-term sample set is especially useful for loss distributions, credibility, aggregate models, coverage modifications, and ratemaking or reserving. The long-term sample set is useful for life-contingency notation, policy values, and premium calculations.

Track misses by skill family: model recognition, payment variable, table lookup, algebra, calculator work, or wording. Most FAM improvement comes from reducing category mistakes, not from rereading entire chapters.