Learning Center
Plans & pricing Sign in
Sign Out

Ramapo ActuarialCareerPresentation


  • pg 1
									Be An Actuary A Career Without Boundaries

         About an Actuarial Career
                Presented By:
       Brought to You By:
               Rob Curry, FCAS
               Phone: 201-469-2674
                Brought to You By:
   My Background
   What is an Actuary?
   Where do Actuaries work?
   What do Actuaries do?
   Why become an Actuary?
   What is the career outlook?
   What skills and talents are needed?
   How can you become an Actuary?
 Rutgers Grad
 BS Math
 How did I find out about the profession
 Fellow of CAS
 AVP & Actuary – Personal Property Actuarial
  Not an insurance company
  Provide data and analytics to insurance industry
  Recent IPO ($1.90B) -- Verisk
          What is an Actuary?
       An Actuary is a person who:
 Analyzes, manages and measures the financial
  implications of future risk.
 Develops and validates financial models to guide
  decision making.
 Typically an actuary uses data from the past to
  predict the future
   Driving a car by looking in the rear view mirror
 Need to quantify how the future will be different from
  the past
   Impact of recession on auto or homeowners
     insurance costs
    Most Common Industries
     Where Actuaries Work
 Insurance Industry
  Property (home) and casualty (auto)
     4,000 actuaries
  Life and annuities
     18,000 actuaries
 Employee Benefit Industry
  Retirement benefits
  Health benefits
  Social Security
 Financial Services Industry
  Banks, investing, risk management
  Mergers & Acquisitions
      Typical Actuarial Projects
   Life Insurance: Designing and pricing life
    insurance products
       Impact of AIDS on mortality tables
   Property & Casualty: Estimating the cost of
    personal auto or homeowners insurance in a
    particular area.
       Global Warming Impact
   Health Benefits: Setting HMO premium rates.
   Retirement Systems: Pricing the cost of
    increasing retirement benefits
Interesting Actuarial Problems
Property/Casualty Actuary
  Automobile Insurance and Credit Scores
  Catastrophe Insurance Coverage –
   wildfires, hurricanes, earthquakes, etc.
    How to account for population shifts or rare
Example of an Actuarial Problem
Ipod Insurance
  What are some factors that you would
   consider for deciding what to charge for
   Ipod insurance
  Same Price for everyone?
    Why not?
  Does location matter?
  What do you think you are getting by
   buying IPOD insurance?
    Why Become an Actuary?
 Use your math expertise to solve real world
 High earning potential
 No cost of graduate school – “learn while you earn”
   Typically given paid time off to study for exams
 Advance by examinations – no “glass ceiling”
 Skills are highly transferable to other industries and
  job responsibilities
 Newsworthy projects
 High demand – less sensitive to economic cycles
 Job security; need expected to grow
 Overall, a highly ranked profession
            Jobs Rated Almanac
   Actuary was rated the #2 job in America,
    according to the 2002 Jobs Rated Almanac.

   #1 Biologist
   -   #2 ACTUARY
   -   #3 Financial Planner
   -   #4 Computer Systems Analyst
   -   #5 Accountant
   -   #6 Software Engineer
   -   #7 Meteorologist
   -   #8 Paralegal Assistant
   -   #9 Statistician
   -   #10 Astronomer
    Jobs Rated Almanac (cont.)
   Actuary has been rated as one of
    the top five jobs in each of the six
    editions published since 1988.
   Actuary has received the #1 job
    rating twice!
   Ranking is based on 6 factors:
    Income, Outlook, Stress,
    Environment, Physical Demands
    and Security
                  Salary Information
   Starting salaries of
    $41,000 - $52,000
    (with one exam and no experience)

   Merit increases
   Examination increases
        E.g. $2,500 per exam at ISO

   Increases for professional

Source: D.W. Simpson & Company, Inc., 2006 Salary Survey
                      Earning Potential
                                Average Actuarial Salaries

                                                                                                1 Exam
                                                                                                4 Exams
                                                                                                7 Exams

                      0.0 - 4.5         4.6 - 9.5        9.6 - 14.5          14.6 +

                                        Years of Experience

Note: Compensation may vary significantly according to years of experience, geographic region and responsibilities.
Source: D.W. Simpson & Company, Inc., 2006 Salary Survey
    Career Outlook for Actuaries

   Employment growth for consulting actuaries
   Development of new financial tools
   Growing ability to model risks
       Data Mining/GLM/Neural Nets
   Growth in the health services industry (?)
   Growth in risk management
    Disadvantages of the Career
 Difficulty of the examination process
     Only about 40% pass ratio for each exam
     Huge time commitment, 200+ hours per exam
     Length of time to complete exams
        7-9 years
        Some people never do )-:

   Frustrating, yet challenging problems
   Narrow field with high degree of specialization
   Consolidation of Insurance Companies
   May need to work several years on routine
    projects before you get the “sexy” ones
       What Skills are Needed
         to be an Actuary?
   Knowledge of math and finance
   Computer skills
   Keen analytical, project management and
    problem solving skills
   Solid communication skills (oral & written)
   Good business sense
   Ability to see and/or argue both sides of an
                How to Become
                  an Actuary
 Like a doctor or lawyer, an actuary achieves professional
  status by passing examinations to prove a certain level of
 Actuarial examinations are administered by the Casualty
  Actuarial Society (CAS) and Society of Actuaries (SOA).
  Three of the first four exams are administered jointly.
 Examinations are held twice a year (1/P – six times/year,
  2FM – 5 times a year)
 Two professional designations exist for each organization:
    Associate (either ASA or ACAS)
    Fellow (either FSA or FCAS)
 You can earn while you learn - employers support
  actuarial trainees taking exams by providing exam study
  time on the job.
 Preliminary Education Structure
 Prerequisites
    Calculus
    Linear Algebra
 Validation by Educational Experience (VEE)
    VEE credits are obtained through college courses (B- or
     higher), standardized exams and approved educational
     experiences for:
       VEE- Applied Statistical Methods
       VEE- Corporate Finance
       VEE- Economics
 Preliminary Education Structure
Preliminary Examinations
  Joint Exam 1/P: Probability
    A. General Probability
    B. Univariate Probability Distributions:
           binomial, negative binomial, geometric, uniform,
           hypergeometric,Poisson, exponential, Pareto, normal, chi-square, beta,
           lognormal, gamma, and Weibull
    C. Multivariate Probability Distributions
  Joint Exam 2/FM: Financial Mathematics
    A. Interest Theory
    B. Finance
                      CAS Exams
 In addition to the preliminary education, each society has
  additional requirements to achieve professional designations
     CAS total of 9 Exams (1-7 for Associateship)
 3 – Statistics and Actuarial Models
     Two separate exams (one part joint with SOA)
 4 Construction & Evaluation of Actuarial Models (Joint with
 5 – Intro to Property & Casualty Ratemaking
 6 – Reserving, Accounting, Reinsurance
 7 – Regulation, Taxation, Annual Statement

 8 – Investments and Financial Analysis
 9 – Advanced Ratemaking, Rate of Return
      Advice for Students
    Who Want to be Actuaries
 Develop disciplined study habits.
 Acquire a well-rounded curriculum, including classes
  approved for VEE credit.
 Sharpen your communication and general business
 Take actuarial exams while in school - the sooner
  you start, the sooner you will finish.
 Find an actuarial internship.
 Familiarize yourself with Insurance Issues
 Scholarship Opportunities

 Actuary of Tomorrow – Stuart A. Robertson Memorial
 CAS Trust Scholarship Program
 D.W. Simpson Actuarial Science Scholarship Program
 Casualty Actuaries Of Greater New York (CAGNY)
          Actuarial Jokes
Wanted to be an Accountant but…
How do you know that you are talking to
 an outgoing Actuary…
How many actuaries does it take to
 change a light bulb…
    Questions and Answers
 To learn more about the actuarial
profession, exams, and internships,
      minority programs visit

Casualty Actuarial Society -
    Society of Actuaries -

To top