Reverse Mortgage is discussed a lot in Chinese insurance market, but in fact, mostof them are the research about the feasibility based on the current situation and thecurrent government policies in terms of macro-analysis. The product designing and themodel construction were less concerned. As an existing insurance product in theinternational market, it is also important for China because its operation can solve a lotof problems we have met already or will meet in the near future.The paper’s purpose is to construct product actuarial model based on theassumptions including rational person, ideal world conditions for government andeconomics and reside permanently. Therefore, only three kinds of risks will beconsidered in the process of modeling: life contingency, housing prices change andinterest rate risk. And in practical analysis, use Monte-Carlo simulation methodconsidering the stochastic processes of housing prices and interest rates.