Think about an insurance policy that pays a monthly benefit if you become disabled and stops when you recover or die. The company needs to know how much money it will need each year, not every moment. This chapter shows how to turn a continuous-time model—where things change at any moment—into a practical, year-by-year tool. You will see that by working in annual steps, we can still capture all the important risks and even test whether a contract is likely to make a profit.