Contents
About the
actuarial profession
·
What is an actuary? What does an actuary do?
·
Professional
actuarial organisations in the World. The International Actuarial Association
·
Advantages
of being an actuary
Development
of the actuarial profession in Ukraine
About the actuarial profession
The word “actuary” derives from the Latin word “actuarius”,
who was the business manager of the Senate of Ancient Rome. Actuarial science
originated in
Actuaries are multi-skilled
strategic thinkers, trained in the theory and application of mathematics,
statistics, economics, probability and finance. They have been called financial
architects and social mathematicians, because their unique combination of
analytical and business skills is used to address a growing variety of
financial and social challenges worldwide.
What does an actuary
do?
Using
sophisticated analytical techniques, actuaries confidently make financial sense
of the short term as well as the distant future by identifying, projecting and
managing a spectrum of contingent and financial risks. In doing so, actuaries
provide decision-makers with valuable information with which to make long-term
strategic decisions, as well as providing practical solutions to problems
involving the possible consequences of future uncertain events.
The Actuary's
role in today's business is to:
·
analyze and manage risk,
·
construct financial modeling frameworks to fit particular circumstances,
·
communicate complex analysis in an easily understood form for senior
management,
·
make calculations which take account of changes in economic and other
conditions, and
·
provide financial advice.
Actuaries are
intricately involved in the increasingly competitive financial services
industry particularly in the areas of:
·
product pricing, targeting profitable segments of business,
·
advising on the appropriate value of reserves, which are often the
largest item on an insurer's balance sheet,
·
reinsurance program analysis,
·
capital management and investment strategy,
·
management information systems,
·
business forecasting,
·
company valuations, and
·
merger and acquisition advice.
The
profession has a statutory role responsible for the solvency of life insurance
companies in many countries. Actuarial involvement in the financial management
of general and health insurance companies is increasing.
Actuaries can
also play an important role in:
·
superannuation, where mathematical and
statistical modeling is used to determine the
financial aspects of superannuation plans such as making recommendations on the
levels of contributions and reviewing the adequacy of funding levels,
·
funds
management, providing advice on investment performance measurement and asset
allocation, as well as quantitative modeling,
·
stock broking
firms, where actuaries may work as analysts particularly for insurance and
gambling stocks, and
·
banking, where an actuary could analyze a mortgage portfolio to determine
likely rates of default, rates of payment of mortgages, future expenses and
suitable levels of mortgage guarantee insurance.
An actuary
designs solutions to problems that involve financial risk or future
uncertainty. This makes actuaries among the most influential professionals in
the financial world.
For example
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Part of job of an actuary is to try to predict what money will do when
it's invested in pensions, insurance, stock markets or other financial
services. Actuaries also have a legal and professional responsibility to ensure
consumers receive the benefits promised by insurance companies and company
pension schemes.
Actuaries solve problems to help protect your future. They combine their
business management role with responsibility for safeguarding the financial
interests of the public.
Solving problems is always satisfying. That's what actuaries do - they
use their intellectual skills to solve practical business problems. You'll also
find that the tougher the problem, the greater the satisfaction and pride you
get in devising an effective solution.
The world of business and finance
changes constantly. The effects of legislation, regulation, deregulation and
globalisation have created an environment that is increasingly complex.
Actuaries are uniquely qualified to make sense of it all. Actuaries routinely
apply statistics, probability, financial mathematics and investment theory to
solve business problems.
In fact, the work of actuaries is also a
science worthy of academic study in its own right and some actuaries work in
universities and in research.
More and more actuaries are becoming
managers. You'll need people skills to work with other professionals, manage
projects and colleagues and provide consultancy services. There are brilliant
opportunities for people who understand business and have the right skills to
make a difference.
Actuaries are in demand in many
different types of organization, but these are the main areas where you can
work:
- Life assurance. These companies provide pensions, life assurance and other financial
services to enable customers to safeguard their long-term financial security.
This includes maintaining an income after retirement or providing for
dependants if they die prematurely. Actuaries design, price and market these
products.
- General insurance. This is the fastest growing area
for actuaries. It includes personal insurance, such as home and motor insurance
as well as large commercial risks. The number and size of claims can be
affected by many different factors - the size of the house, postcode and
security in home insurance, for example. Actuaries combine their statistical
skills with knowledge of investment, accounting, law and business.
- Investment. All actuaries know about
investment but you can specialise in managing investments, monitoring
performance and advising on investment decisions. You could work for investment
banks, stockbrokers or the investment departments of large companies, as well
as in general business consultancy.
- Pensions.
Actuaries make recommendations on the adequacy of funding levels for
pension plans and provide statutory certifications to support pension and benefit
plan legislation in countries around the world.
Professional actuarial organisations
in the World.
The International Actuarial Association
The first professional association of actuaries was established in 1848 in
Founded in 1895, the International Actuarial Association (IAA) is a
worldwide association of professional actuarial associations and individual
actuaries.
The IAA exists to encourage the development of a global profession,
acknowledged as technically competent and professionally reliable, which will
ensure that the public interest is served.
Its objectives are to:
·
develop the role and reputation of the
profession
·
promote high standards of
professionalism to ensure that the public interest is served
·
advance the body of knowledge of
actuarial science
·
further the personal professional
development of actuaries
·
promote mutual esteem and respect
amongst actuaries
·
provide a discussion forum for actuaries
and actuarial associations
·
represent the profession to
international bodies
The IAA has 49 Full Member and 25 Associate Member Associations in 67
countries, which cover over 29,000 individuals who are full members of their
association.
The following is the list of the most developed actuarial organisations,
full members of the IAA
The Faculty and
The Society of Actuaries (
The Casualty Actuarial Society (
Groupe Consultatif Actuariel
(European Union)
Canadian
The
Individual membership in the IAA is also open to other qualified
actuaries who do not automatically qualify as members by virtue of membership
of a Full Member Association.
The IAA is a non-profit-making and non-political Non-Governmental
Organisation. It is on the Roster of the Economic and Social Council of the
United Nations Organisation (UNO) and on the Special List of the International
Labour Office (ILO).
There are two main systems of professional education for actuaries.
These are US Society of Actuaries education system (used in
For more details regarding actuarial organizations and professional
standards please refer to the IAA web site
How to become an actuary?
Actuaries
receive excellent training. Their hard-earned professional qualification and
achievement is recognized throughout the business world.
In order to be
qualified as an actuary you need to pass a series of professional exams of one
of the full members of the International Actuarial Association.
Now in