An actuary analyzes companies risk of financial costs and test the probability of an event that may affect an organizations financial security. They play a key role in the insurance industry and other businesses by reducing potential risk and instability. Actuaries use statistics, math, and financial theory to predict these factors. Actuaries also use advanced modeling statistics and software for accurate data.
How to Become a Actuary
To become an actuary one must earn a bachelor’s degree in mathematics, actuarial science, or statistics. Coursework usually includes economics, computer science, mathematics, business, and statistics classes. Actuaries are also required to get certified by passing a series of exams. However, as an entry level actuary you usually work under a group of experienced professionals and during this time you are a trainee that is groomed for the certification process.
According to O*NET OnLine, over 60% of actuaries hold at least a bachelor’s degree. The rest have certifications or education in addition to having earned their bachelor’s degree.
Job Description of a Actuary
An actuary develops, prices, and evaluates financial cost or risks for businesses, insurance companies and other clients. They analyze statistical information such as disability, mortality, retirement rates, and accidents to predict liability payments of future benefits or any potential risks. They must have good verbal and written communication skills as well as analytical skills.
Actuaries help companies ensure payment of future benefits by ascertaining cash reserves and premium rates needed. A variety of people such as shareholders, company executives, government officials and others would expect an actuary to explain complex technical matters and help determine company policies. He or she would review, design and help administer pension plans, insurance and annuity plans, or policies by calculating premiums and financial soundness.
Actuaries use their expertise to assist businesses or clients maximize returns and manage risks with credit offerings or investment products. They analyze statistical information and other data to construct probability tables for cases pertinent to a company or client. One might be required to give testimony to public agencies affecting business on proposed legislation.
An actuary must have knowledge of economics, legal codes, government regulations, and agency rules. They should have the ability to read, understand and listen to information, and clearly communicate. They should remain technically current with pertinent job information and apply any new knowledge to his or her work. They should be able to think creatively by designing or developing new applications to the job. Some actuaries work in an office, however as an actuary consultant some travel may occur to meet clients.
Actuary Job Post
Let’s look at a posted actuary job description. This job announcement was posted by the Federal Emergency Management Agency looking for a candidate to perform the following tasks:
- Perform quantitative analyses and actuarial support including rate-making for existing and for new coverages based on consideration of loss experience and theoretical damage and frequency data resulting from hydrologic studies, and the study of the catastrophic loss funding requirements unique to the National Flood Insurance Program (NFIP).
- Perform quantitative analyses and actuarial support to provide management with quantitative basis for making program decisions on the size, scope and mechanism for providing insurance.
- Act as representative of the Deputy Administrator with contractor staff, insurance companies and their industry advisory groups, and others in policy matters concerning the Write Your Own (WYO) Statistical Plan and actuarial aspects of the NFIP.
- Prepare and presenting briefings explaining and defending studies and results to various internal and external groups.
- Serve as the expert technical advisor for the development of actuarial policy used as guidelines for Insurance Underwriters and Write Your Own (WYO) Companies nationwide.
This position was posted in October 2017 on USAjobs.gov, part of the U.S. Office of Personnel Management.
Bureau of Labor Statistics, U.S. Department of Labor, Occupational Outlook Handbook, Actuaries.
National Center for O*NET Development. 15-2011.00. O*NET OnLine.