What does an actuary do?
Actuaries calculate the probability of different outcomes and their potential financial impact. As an actuary, you will need to analyse data to help plan for the future and minimise risk. Insurance can involve actuaries in:
- Calculating insurance premiums
- Advising on pension plans
- Managing financial assets and liabilities.
An actuary’s traditional areas of work include pensions, life and general insurance, investment and consultancy.
In insurance, actuaries analyse past and present data in order to solve real business problems. They will then relay and offer their expert advice to non-specialists with their excellent communication skills.
Where do actuaries work?
Actuaries can use their skills and expertise to expand their work into various different areas and this can include in investment management and corporate finance, banking, pensions and benefits and of course risk management. In the insurance industry, actuaries can work in different areas and have different roles depending on the area they work in.
For example, in life insurance, actuaries are involved in all stages of the produce development, pricing, risk assessment and marketing of the products. They can also fill key roles in financial management and the investment of policyholders’ money by developing strategies to ensure that customers get a good return.
In general insurance, actuaries are working with personal insurance such as home insurance as well as insurance for large commercial risks; where they are responsible for the financial management of the company they work for. Actuaries can also move into working in reinsurance or even in broking operations. Statistical models are a key part of an actuary’s work, as actuarial and statistical techniques are used substantially in their work to analyse large amounts of date. This analysis is then used to rate risks and to ensure that claims reserves are adequate to meet the eventual settlement of insurance claims.
Why should I become an actuary?
There are many reasons you should consider having an actuarial career; being an actuary can be financially rewarding, offer a range of opportunities and be intellectually challenging for those who want progression in their careers. When embarking on an actuarial career you are offered excellent study support and training to progress and become value in your career. Employers usually offer paid study leave and cover the cost of external tuition and exam costs; as well as some even offering mentorship schemes. Once you area trained actuary, you will be part of a high profile, prestigious and well respected profession. As an actuary, you will high-level businesses with their problems in a range of industries; this includes influencing investment decisions to designed pension schemes that could affect thousands of lives; therefore you can make an impact on the world by working as an actuary.
Skills you need to be an actuary
To become an actuary, you will need a range of skills in order to succeed these include;
- Excellent academics
In order to be an actuary, you will need to undertake various exams throughout your career and training to become qualified. To succeed, having excellent scores and academic achievements will allow you grow in your actuarial career.
- Excellent communication skills
A huge part of being an actuary is analysing data and communicating hard-to-understand information to your colleagues or clients. So having excellent communication skills and the ability to understand deliver complex data is essential to being an actuary.
- Strong numeric and logic skills
To become an actuary you will need to have excellent numerical skills; there are many exams and training involved in becoming a qualified actuary so strong numerical and logic skills will benefit you in your training and actuarial career.
- Be able to distinguish between the important and the unimportant
As an actuary, your role is to be apart of important decisions that could impact businesses and people’s lives; so you would need to be confident in your ability to understand what is important
- Be willing to learn and never be afraid to ask questions.
As a graduate pursuing an actuarial career, the best way to learn is to be inquisitive and note be afraid to ask questions. This will help you when tackling complex problems in your career as well as understanding the different companies and areas you can work in as an actuary.
Actuaries in Insurance
Actuaries have historically been employed by insurance companies and have now diversified to be able to work in a variety of industries all over the world; such as in pensions and benefits, risk management and finance and investment.
Actuarial skills have been recognised to work in personal finance planning, damages and healthcare; as well as in some more traditional areas such as pensions, insurance and investment. So, in today’s climate actuaries are able to work in various part of the insurance sector; in areas such as life insurance, general insurance and risk management.
An actuarial career can be quite rewarding financially depending on their education level, skill set and expertise. In the past few years, salaries have risen slightly with graduate salaries starting at around £28,000 going all the way up to around £269,000 for senior roles such as being a partner. For experienced actuarial analysts/consultants the salary can be around £36,000 going up to £54,000 for more senior actuarial analyst/consultant roles.
How do I become an actuary?
An actuarial degree is not a requirement to enter the profession. However it is necessary to have an A level or equivalent in maths; as well as a mathematically-related degree, such as maths, statistics, economics, science or engineering.
To become a professional actuary, you will need to pass the exams and qualify as a Fellow of the Institute and Faculty of Actuaries. Graduate training schemes are the usual way to enter the profession, which you apply for directly with insurance employers. Your employer will then provide on-the-job training; as well as allowing you study days and sponsoring you through your actuarial exams.