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The Actuary as Chameleon


									     TRADECRAFT                             B   Y    P   A U L   W   A L S H

                                          The Actuary as Chameleon
                 VER THE PAST FEW YEARS, THERE’S BEEN A SEA CHANGE in the aver-                    underlying skill: You used a

       O          age actuary’s career path. No longer do actuaries want to be combination of financial, cash
                  tagged as life actuaries or pension actuaries for their entire flow, and risk modeling skills to
         careers, but as business actuaries who have experience in a num-
         ber of actuarial disciplines.
                                                                                                   achieve the desired result.
                                                                                                       Don’t overdo it, though. If
                                                                                                   you spent your summers work-
             There are many reasons for actuaries’ desire for flexi- ing down at the local Shell station filling gas tanks all day
         bility. Some have become bored in their current roles and long, you know you were a gas pump attendant, not a
         feel like a new challenge. The merging of financial servic- “fuel injection technician”!
         es organizations has meant that a number of different ac-
         tuarial disciplines are now offered by one employer, mak- The Defining Moment for Defined Benefit
         ing it easier for the actuary to move jobs internally. Or The advent of FRS17 was a defining moment for defined
         perhaps they’ve moved out into the countryside for fami- benefit plans — the beginning of the end. What was in-
         ly reasons and the choice is be-                                            troduced as a mechanism for reporting the
         tween the local fish-processing                                             true cost of running the employer-sponsored
         plant and whatever actuarial                                                retirement plan has actually influenced em-
         organization happens to be in                                               ployers to withdraw from DB plans and switch
         the area.                                                                   to defined contribution instead. Apart from
             The purposes of this arti-                                              asking whether this was really the intended
         cle, therefore, are to advise ac-                                           consequence, pension actuaries are also won-
         tuaries on how to switch be-                                                dering what they’ll do next.
         tween the various actuarial                                                     There’s no need to worry. Even where em-
         disciplines; to reassure pen-                                               ployers are putting new employees into DC
         sion actuaries that there is life                                           plans, the DB plan for existing employees
         after the culling of defined                                                may take many years yet to run off. Thus,
         benefit pension plans; and to                                               the DB pension actuary will still be required
         equip all of the above with some of the tools they’ll need when I’m pushing up daisies.
         in the job-search jungle, including résumé and interview          In addition, employers with DC plans will still require
         preparation skills.                                           significant advice from actuaries. Why? Because DB and
                                                                       DC are really just different sides of the same coin. With the
         Transferable Skills                                           first, you know the end benefit (pension as a percentage of
         Think skills, not tasks (see Table). In order to transfer final salary) and you need to calculate the contribution rate;
         smoothly from one actuarial discipline to another, it’s im- with the second, you know the contribution rate and you
         portant to identify your transferable skills. This means ask- need to calculate the projected retirement fund.
         ing “what skills do I have?” not “what job do I do?” Your         The latter may sound simpler, but in reality it’ll be of
         previous day-to-day tasks are likely to have little relevance little help to employees to simply give them 800 num-
         to your new duties and responsibilities (and probably will bers to call. It’s likely that pension actuaries will convert
         make little or no sense to your potential new employer). the projected retirement fund into an annual pension
         However, your underlying skills may be very relevant and, equivalent so that employees can readily understand its
         once transferred, can be used in very different ways.         relationship to their final salary, as well as understand
             For example, instead of saying you priced life insurance whether their current contribution rate is sufficient.
         products (life actuary), set premium rates for motor in-          “In a DC environment,” says Michael Moloney, an em-
         surance (non-life actuary), or performed triennial valua- ployee benefits consultant with Mercer, “you need to be
         tions (pensions actuary), you should be highlighting the able to explain the key factors driving retirement income
                                                                       to members, not just trustees.” Pension actuaries will be
                                                                       using the same skills, just in a different environment.
         A CUMEN R ESOURCES , AN ACTUARIAL RECRUITING                     It’s Life Insurance, Jim, But Not As We Know It
         FIRM IN THE U NITED K INGDOM WITH OPERATIONS                     For another example, let’s look at the financial reinsurance
         WORLDWIDE .                                                      or alternative risk transfer (ART) market. This market for

54   Co n t i n g e n c i e s   November/December 2003
 actuaries has, until recently, burgeoned                  backgrounds and represent all the major         life and achievements, highlighting those
 over the past few years. One example of                   disciplines. They have very different past      skills, knowledge, and events that will ap-
 an ART product is an investment loan to                   experience, but all were able to demon-         peal to your new potential employer.
 a life or general insurance company, with                 strate the underlying skills (analytical, fi-       A well-documented résumé should
 a reinsurance wrapper.                                    nancial modeling, and client relationship       demonstrate:
     Do I need to be a life, general insur-                skills) required to switch to ART.              ■ A degree of progression; an increasing
 ance, or investment actuary to work in                                                                    level of experience or responsibility and/or
 this area? If you look at a cross section of              Résumés Sell                                    the gaining of a wider skill set
 the actuaries practicing in this field, you’ll            A résumé is ultimately a marketing docu-        ■ A variety of skills used
 see that they come from very diverse                      ment—a short summary of your working            ■ At least one main achievement, more
                                                                                                           if relevant.
                                                                                                               There are two main types of résumé in
                                                                                                           use—the chronological résumé and the
                                                                                                           skill-set résumé.
                                                                                                               The chronological résumé should take
                                                                                                           the following format:
                                                                                                           ■ A high-level overview of your main role.
                                                                                                           ■ Bullet points giving the main tasks and
                                                                                                           achievements in decreasing order of im-
                                                                                                           portance. Putting the strongest items first
                                                                                                           not only captures attention but also shows
                                                                                                           discernment about the weightings you at-

                                                                                                           tach to the various aspects of the job and
                                                                                                           an awareness of the overall picture.
                                                                     Turning promise                       ■ Each period of employment laid out
                                                                     into practice.™                       with the employer’s details, period of em-
                                                                                                           ployment, role and position of the person
                                  Actuarial Opportunities                                                  to whom you reported clearly identified.
     At Aetna, we are transforming our company, offering more information, more choice and                 Use explicit action words, describing ex-
     more freedom to our customers to help them lead healthier lives. To succeed, we need                  actly what work you did (e.g., analyzed,
     people who have the skills to help us create and maintain efficiencies in all we do. Do you           researched, investigated, implemented,
     want to be part of a team with a passion for excellence? If so, there may be a place for you
     at Aetna.                                                                                             etc.). Avoid vaguer descriptions such as
     Working at Aetna means being part of a commitment to excellence, where you could play a               “responsible for,” “involved in.”
     vital role in helping to reshape our business and contributing to the strength and                    ■ Include anything you’ve done or
     profitability of our company. We recognize that actuaries are the financial architects of our         brought to the role that added value or
     company and the foundation for achieving financial excellence.
                                                                                                           made an improvement or innovation. Ex-
     As one of the nation's leading providers of health care and related benefits, Aetna serves
     approximately 15 million health care members, 12 million dental members and 11.9 million              plain it clearly.
     group insurance customers. We provide health care and related benefits to employer and                ■ Include the results of the work did and
     plan sponsor customers in all 50 states, ranging from large multi-site national accounts to           how it benefited the company. Where
     middle-market and small-employer groups. There has never been a more dynamic and
     exciting time to join Aetna than now.                                                                 possible these should be quantified (e.g.,
     We currently have multiple actuarial positions available for candidates ranging from                  budgets; increases in profits or efficien-
     actuarial students to management, including non-traditional opportunities.                            cies; staff numbers; staff turnover, etc.).
     To learn more about our employment opportunities, visit us at                  For less-senior roles the results may not
     You can also apply directly by sending your resume to Be sure              be as quantifiable but can nonetheless be
     to include SACT2/ in your e-mail subject line. It’s that easy!
                                                                                                           given (e.g., automated processes).
     Aetna Inc. is an Equal Opportunity/Affirmative Action employer. M/F/D/V                                   In general, put yourself in the em-
                                                                                                           ployer’s shoes. The easier they can glean
                                                                                                           the relevant information from the résumé,
                                                                                                           the happier they’ll be—clear, uncluttered,
                                                                                                           easy to read, and with the relevant infor-
                                                                                                           mation succinctly described.
                                                                                        The skill-set résumé works better if
                                                                                                           you’re moving into a new field or trying

56     Co n t i n g e n c i e s   November/December 2003
                                          Financial modeling skills   Communication skills   Organizational skills
                                          Risk modeling               Verbal skills          Time management
                                          Cashflow modeling           Written skills         Project management
                                          Statistical modeling        Facilitation skills    Attention to detail
                                          Stochastic modeling         Presentation skills
 to avoid repetition. In this in-         Data modeling               Negotiation skills                                   of a strength (e.g., thorough
 stance, it can be good to have                                                                                            /over-cautious, assertive/ag-
 a personal profile at the top of Analytical skills              Client relationship skills  Managerial skills             gressive) and you demonstrate
                                     Problem-solving             2 ears, 1 mouth approach Delegation
 the résumé that highlights Financial analysis                   Professionalism             Man management                what you’ve done or are doing
 skills and strengths that might Strategic analysis              Understand their needs      Team working                  to overcome or address the
 not otherwise come through in Operational analysis              Manage their expectations Coaching and develop-
 the experience described.
     Experience could be Technical knowledge skills              Business development skills Motivational skills           Technical Questions
                                     Legislative knowledge       Sales                       Innovation
 grouped under skills headings                                                                                             You should be up to speed on
                                     Regulatory knowledge        Marketing                   Assertiveness
 to highlight the most relevant European directives              Business retention          Enthusiasm                    developments in the actuari-
 skills to the role sought. For ex- Irish taxation law                                       Self-starter                  al and insurance world that
 ample, use headings such as International taxation law                                                                    are in any way relevant to the
 Technical Skills, Client Facing                                                                                           role. Knowing more than ex-
 Skills, and Communication Skills, and then confident you’ll be in handling whatever pected will show energy and motivation.
 document under each of these headings comes up in the interview itself.
 your relevant past experience that demon-              When you prepare your answers, keep Prepare Questions for Interviewers
 strates these particular skills.                   the end in mind—a true and favorable Obviously the questions you ask will be
     Where there are numerous employers, picture reflecting your ability, achieve- partly determined by the way the inter-
 the work can best be described under type ments, suitability, and willingness. You’ll view progresses. It’s a good idea, howev-
 of work rather than under each employ- want to present yourself as a person with er, to have thought through what you
 er, which avoids needless repetition.              development potential and project a pos- would like to have clarified during the in-
                                                    itive attitude.                                          terview and to have questions prepared
 No Pain, No Gain                                                                                            based on your requirements.
 I advise people to focus on three main goals Strengths                                                          Asking questions not only allows you
 as part of their interview preparation:            This is the area where you have the scope to obtain information of concern to you
 ■ Prepare a key message                            to paint yourself in the best possible light. but also gives you an opportunity to show
 ■ Identify key questions                           I suggest having at least five or six strengths your potential and interest by asking in-
 ■ Prepare all answers                              prepared, giving the top three or four when telligent and incisive questions.
     When preparing a key message, es- the question is first asked and leaving a few                             So, whether you want move up the
 tablish one or two clear statements about to draw on in follow-up. Even if the ques- ladder in your current company, change
 yourself and what you have to offer the tion isn’t specifically asked, create an op- tack completely, or want that job in the
 potential employer.                                portunity to bring them into the conver- local fish-processing plant, the most im-
     A good way to begin is to identify five sation; get your key message across.                            portant thing to remember is to highlight
 or six strengths you can offer the compa-              Be prepared with concrete examples your relevant skills. If you’re a life actu-
 ny and from these distill the essence of of your strengths. This adds weight and ary and want to become a general insur-
 what you have to contribute. When you’re credibility to your responses. Whenever ance actuary, focus on your data model-
 happy with your key message, repeat it you state a strength or achievement, fol- ing, statistical modeling, and risk
 aloud. This will ingrain the message in your low it up with a clear example of how modeling skills. If you’re a general insur-
 mind and make it easier to bring it out at you’ve demonstrated that strength in the ance actuary and want to become an em-
 an opportune moment in the interview.              past (or where you would expect to ployee benefits actuary, focus on your
     In thinking about the message you demonstrate it in the future). Where pos- communication skills, client relationship
 want to convey, be brutally honest with sible, state how it could benefit the com- skills, and business development skills.
 yourself. An interviewer will know if pany (e.g., budget savings, increases in                                  If you are an environmental impact
 you’re not telling the truth, so prepare profits or efficiencies, time savings, im- modeling actuary and want to specialize
 statements you’ll be confident giving at provement in staff turnover, etc.). For less- in investment—hmm, pray hard !
 the interview.                                     senior roles the results may not be as                       But the future for actuaries is bright.
     In identifying key questions, it’s vital quantifiable but can nonetheless be giv- More and more actuaries are leaving spe-
 that you anticipate and prepare for the en (e.g., automated processes, improved cialties to become generalists. We’re open-
 questions most likely to be asked. Don’t documentation standards, etc.).                                    ing more doors for ourselves, not only
 avoid preparing for the tough questions.                                                                    within the different disciplines of our pro-
 Recognize and address the questions where Weaknesses                                                        fession but also in wider fields, such as
 you feel most vulnerable, and prepare an Again, honesty is important. Don’t avoid or management consulting, the power and
 honest and well thought-out response.              gloss over these questions. Make your re- energy industry, and recruitment!
     Prepare as many of these as you can. sponses as positive as possible. Weaknesses                            As Bill Gates would say, “Where do you
 The more you have prepared, the more are more acceptable if they’re the opposite want to go today?”                                                    ●

58   Co n t i n g e n c i e s   November/December 2003

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