Be An Actuary A Career Without Boundaries
About an Actuarial Career
Presented By:
Brought to
You By:
Laura McSweeney
Brought to You By:
Overview







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?
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.
Where do Actuaries Work?








Insurance companies
Consulting firms
Government insurance departments
Banks and investment firms
Large corporations
Public accounting firms
Colleges and universities
Anywhere risk management
is needed
Most Common Industries
Where Actuaries Work
 Insurance Industry
Property (home) and casualty (auto)
Life and annuities
 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
Property & Casualty: Estimating the amount
of money to be set aside for insurance claims
that have not been paid
Health Benefits: Setting HMO premium rates.
Retirement Systems: Pricing the cost of
increasing retirement benefits
Finance & Investments: Portfolio
diversification studies
Interesting Actuarial Problems
Property/Casualty Actuary
Automobile Insurance and Credit Scores
Catastrophe Insurance Coverage –
hurricanes, earthquakes, etc.
Modeling retention changes for large
corporations
Interesting Actuarial Problems
Health Actuary
$10 co-pay vs. $25 co-pay for prescription
drugs
HMO vs. Large Deductibles (Health
Savings Accounts)
National Prescription Drug Plan
Interesting Actuarial Problems
Pension Actuary
Social Security Funding
Employer-Sponsored Pension Plan vs.
401K
2% x years of service vs. 1.5% x years of
Service – Pension Benefits
Why Become an Actuary?









High earning potential
No cost of graduate school – “learn while you earn”
Advance by examinations – no “glass ceiling”
Skills are highly transferable to other industries and
job responsibilities
Newsworthy projects
Potential for travel as a consultant or a 9-to-5 job
with little or no travel as a non-consultant
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 #1 job in
America, according to the Wall
Street Journal (2010), #2 in 2012,
#4 in 2014
The Examiner (2009) and CNN
Money (2012) claim that actuaries
one of the top fields to be in
during a recession.
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

Increases for professional
designations
Source: D.W. Simpson & Company, Inc., 2006 Salary Survey
Earning Potential
Average Actuarial Salaries
$250,000
$200,000
1 Exam
4 Exams
7 Exams
Fellow
$150,000
$100,000
$50,000
$0
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
Disadvantages of the Career
 Difficulty of the examination process
 Frustrating, yet challenging problems
 Narrow field with high degree of
specialization
 Confinement to an office (non-consultant)
 Travel and long hours (consultant)
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
What Talents are Needed
to be an Actuary?

Motivation

Creativity

Independence

Ability to work with others
How to Become
an Actuary
 Like a doctor or lawyer, an actuary achieves professional
status by passing examinations to prove a certain level of
knowledge.
 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 – four times/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,
standardized exams, approved educational experiences,
and transitional exams for:
 Applied Statistical Methods: EC 380 (Econometrics) w/ prereq.
EC 278 (Statistics) [or MA351/352 with permission of chair]
 Corporate Finance: FI 101 (Intro. to Finance) w/ prereq. AC 11,
EC 11, EC 12 and FI 215 (Financial Management)
 Economics: EC11 (Micro) and EC12 (Macro)
Preliminary Education Structure
Preliminary Examinations
Joint Exam 1/P: Probability
Joint Exam 2/FM: Financial Mathematics
 In addition to the preliminary education, each
society has additional requirements to
achieve professional designations
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
skills.
 Take actuarial exams while in school - the sooner
you start, the sooner you will finish.
 Find an actuarial internship.
Advancing Diversity
 Minority Students:
 African American, Latino, or Native American
 Scholarships for Minority Students
 Individual awards of $500 - $3,000, annually
 Demonstrated performance and commitment
 Exam Fee Reimbursement for Minority Students
 Reimbursed for successfully passing Exam P/1
and/or FM/2
 Visit the website www.BeAnActuary.org
Minority Programs: Scholarship applications, exam
fee reimbursement forms, internships, and more.
Questions and Answers
To learn more about the actuarial
profession, exams, and internships,
visit
BeAnActuary.org
Casualty Actuarial Society - www.casact.org
Society of Actuaries - www.soa.org
Advice
Some past students recommended the
online seminars offered through The
Infinite Actuary (theinfiniteactuary.com)
and/or study materials from Actex
(actexmadriver.com)
Video Info:
Exam Process
Actuary basics
Info about being an Actuary