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'''Actuaries''' are professionals who analyze the financial impact of ], particularly looking ahead far into the ]. Actuaries use skills in ], ], ] and ] to study uncertain future events, especially those of concern to ] and ] companies, employee benefits such as ] and ] plans, and ] programs such as ] and ]. '''Actuaries''' are professionals who analyze the financial impact of ], particularly looking ahead far into the ]. Actuaries use skills in ], ], ] and ] to study uncertain future events, especially those of concern to ] and ] companies, employee benefits such as ] and ] plans, and ] programs such as ] and ].
==Actuarial Work==

===Disciplines===
Most actuarial work can be compartmentalized into one of two major groups which are classically called Life and Casualty. The first deals with risks that pertain to the ongoing health, well-being, and natural mortality of people such as ], ], ]s, disability and ]. The second deals with more catastrophic, unnatural risks that can occur to people and property. This area, is known in some countries as ], and in the US as Property/Casualty insurance, where the terms casualty and liability may be used interchangeably. These risks include those such as ], ], commercial property insurance, ], title insurance, medical malpractice insurance, products liability insurance, directors and officers liability insurance, environmental insurance, and other types of liability insurance. Most actuarial work can be compartmentalized into one of two major groups, usually referred to as Life and Casualty. Life Actuaries deal with risks that pertain to the ongoing health, well-being, and natural mortality of people such as ], ], ]s, disability and ]. Casualty actuaries deal with more catastrophic, unnatural, risks that can occur to people and property. This area is known in some countries as ] and in the US as Property/Casualty insurance, where the terms casualty and liability may be used interchangeably. These risks include those such as ], ], commercial property insurance, ], title insurance, medical malpractice insurance, products liability insurance, directors and officers liability insurance, environmental insurance, and other types of liability insurance.

===Classic Responsibilities===
⚫ In some countries, becoming a fully certified actuary requires passing a rigorous series of exams, which takes several years, much of it after college and while working. For instance, in the U.S. the exams are given by the ] and the ] . These align with the two major branches of actuarial work.

On the both the life and casualty sides, the classical functions of actuaries are to compute premiums and reserves for insurance policies covering various risks. Premiums are the amount of money the insurer needs to collect from the policyholder in order to cover the expected losses, expenses, and a provision for profit. Reserves are provisions for future liabilities, and indicate how much money should be set aside now to reasonably provide for future payouts. If you inspect the balance sheet of an insurance company, especially casualty companies, you will find that the liability side consists mainly of reserves. On the both the life and casualty sides, the classical functions of actuaries are to compute premiums and reserves for insurance policies covering various risks. Premiums are the amount of money the insurer needs to collect from the policyholder in order to cover the expected losses, expenses, and a provision for profit. Reserves are provisions for future liabilities, and indicate how much money should be set aside now to reasonably provide for future payouts. If you inspect the balance sheet of an insurance company, especially casualty companies, you will find that the liability side consists mainly of reserves.


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As actuaries have always been considered as the preeminent experts on financial risk, there has been a recent widening of the scope of the actuarial field to include ] advice and even ]. As actuaries have always been considered as the preeminent experts on financial risk, there has been a recent widening of the scope of the actuarial field to include ] advice and even ].
===Typical Employment===

Actuaries will typically be employed in ] or ] companies, ] firms (i.e., firms that sell actuarial advice and analysis to other companies), or ] departments, such as the ] in the UK or the ] in the US. Many belong to one or more professional bodies, which include: Actuaries will typically be employed in ] or ] companies, ] firms (i.e., firms that sell actuarial advice and analysis to other companies), or ] departments, such as the ] in the UK or the ] in the US.
==Credentialing and Exams==
⚫ In some countries, becoming a fully certified actuary requires passing a rigorous series of exams, which takes several years, much of it after college and while working. For instance, in the U.S. the exams are given by the ] and the ] . These align with the two major actuarial disciplines.
==Actuarial Organizations==
Actuaries usually belong to one or more professional bodies, which include:
*the ]; *the ];
*the ]; *the ];
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*the ] in ]; *the ] in ];
*the ] in ]; *the ] in ];


==See also== ==See also==
*] *]

Revision as of 14:48, 28 July 2005

Actuaries are professionals who analyze the financial impact of risk, particularly looking ahead far into the future. Actuaries use skills in mathematics, economics, finance and statistics to study uncertain future events, especially those of concern to insurance and reinsurance companies, employee benefits such as medical insurance and pension plans, and social welfare programs such as social security and Medicare.

Actuarial Work

Disciplines

Most actuarial work can be compartmentalized into one of two major groups, usually referred to as Life and Casualty. Life Actuaries deal with risks that pertain to the ongoing health, well-being, and natural mortality of people such as life insurance, annuities, pensions, disability and medical insurance. Casualty actuaries deal with more catastrophic, unnatural, risks that can occur to people and property. This area is known in some countries as general insurance and in the US as Property/Casualty insurance, where the terms casualty and liability may be used interchangeably. These risks include those such as auto, homeowners, commercial property insurance, workers' compensation, title insurance, medical malpractice insurance, products liability insurance, directors and officers liability insurance, environmental insurance, and other types of liability insurance.

Classic Responsibilities

On the both the life and casualty sides, the classical functions of actuaries are to compute premiums and reserves for insurance policies covering various risks. Premiums are the amount of money the insurer needs to collect from the policyholder in order to cover the expected losses, expenses, and a provision for profit. Reserves are provisions for future liabilities, and indicate how much money should be set aside now to reasonably provide for future payouts. If you inspect the balance sheet of an insurance company, especially casualty companies, you will find that the liability side consists mainly of reserves.

On the casualty side, often, this analysis involves quantifying the probability of a loss event, called the frequency, and the size of that loss event, called the severity. Further, the amount of time that occurs before the loss event is also important, as the insurer will not have to pay anything until after the event has occurred. On the life side, often, the analysis involves quantifying how much a potential sum of money or a financial liability will be worth at different points in the future. Since neither of these kinds of analysis are purely deterministic processes, stochastic models are often used to determine a frequency and severity distributions and the parameters of these distributions. Also, forecasting interest yields and currency movements play a role, especially on the life side.

Furthermore, actuaries do not always attempt to predict aggregate future events. Often. their work may relate to determining the cost of a financial liabilities that have already occurred, called retrospective reinsurance, or the development or re-pricing of new products.

As actuaries have always been considered as the preeminent experts on financial risk, there has been a recent widening of the scope of the actuarial field to include investment advice and even asset management.

Typical Employment

Actuaries will typically be employed in insurance or reinsurance companies, consulting firms (i.e., firms that sell actuarial advice and analysis to other companies), or government departments, such as the Government Actuary's Department in the UK or the Social Security Administration in the US.

Credentialing and Exams

In some countries, becoming a fully certified actuary requires passing a rigorous series of exams, which takes several years, much of it after college and while working. For instance, in the U.S. the exams are given by the Society of Actuaries (www.soa.org) and the Casualty Actuarial Society (www.casact.org). These align with the two major actuarial disciplines.

Actuarial Organizations

Actuaries usually belong to one or more professional bodies, which include:

See also

External links

Categories: