What is an Actuary?
An Actuary is a highly trained statistician with expertise in evaluating various types of risks. Roughly 60% of actuaries are employed by insurance companies, and play a key role in setting the terms and conditions of insurance policies, including premium rates. An actuary also has career opportunities in pension fund management, forecasting future payouts and determining current contributions and investment policies in light of them. Additionally, actuaries (either in-house or consultants) help companies in all industries design and implement policies and procedures to mitigate risks in various aspects of their operations.
An actuary is expected to have at least a bachelor’s degree. There is prescribed coursework in statistics or actuarial science (a branch of applied statistics), plus business, finance and economics. A high degree of computer literacy is increasingly important, especially with regards to software packages commonly used for database and statistical analysis. An MBA can be a useful credential, depending on the firm.
How do I become an Actuary?
In the Department of Statistics and Applied Probability, we have an Actuarial Concentration which will prepare you for a career in the actuarial profession. Multiple actuarial designations are available nowadays, including Fellow of the Society of Actuaries, Fellow of the Casualty Actuarial Society, Certified Enterprise Risk Analyst and Registered Professional Liability Underwriter. Our degree will help you pass the actuarial exams which are necessary to obtain these certifications and future career advancement. You can also join the Actuarial Club to meet other students who share your interests and aspirations. If you want to know more about our program, talk to the Undergraduate Program Assistant in the Statistics Department, South Hall 5607.
Duties and Responsibilities:
The job of actuary involves detailed analysis of data to quantify risks. It also requires expertise with advanced modeling techniques to forecast future probabilities of various outcomes, such as losses or claims and their expected magnitudes. While technical expertise and quantitative skills are a must, advancement is dependent, to a great degree, on the ability to communicate effectively with managers who lack this background. Do not confuse an actuary with an insurance underwriter, who evaluates applications for insurance, and makes decisions on whether to accept or reject them. An actuary works at a more macro level, setting the high-level parameters that guide insurance underwriters.
The typical actuary works close to a standard 40 hour week, normally from a fixed office location. A consulting actuary tends to have significant travel, and thus may work considerably longer hours.