FAQs about the Actuarial Field
What is Actuarial Science/Mathematics?
It is the study and application of financial concepts associated mainly with demography (i.e. analysis of population mortality, life expectancy etc.) to real world problems predominantly in the insurance arena.
What is an actuary?
Actuaries apply financial and statistical theories to solve real business problems. These business problems typically involve analysing future financial events, especially when the amount of a future payment, or the timing of when it is paid, is uncertain. A lot of actuaries’ work might be thought of as ‘risk management’, assessing how likely an event may be and the costs associated with it.
Understanding how businesses operate, how legislation may impact and how financial economics can affect values are all vital skills for an actuary. But what differentiates actuaries is their core mathematical, economic and statistical understanding and their ability to apply this to real financial problems.
What are the examples of actuarial work?
The traditional areas in which actuaries operate are: consultancy, investment, life and general insurance and pensions. Actuaries are also increasingly moving into other areas of the financial sector where their analytical skills can be employed.
Actuarial consultancies offer a whole range of services to their clients on issues such as acquisitions, mergers, corporate recovery and financing capital projects. Many also offer advice to employers and trustees who run occupational pension schemes. In fact, such consultancies are probably the biggest employers of actuaries in the UK.
In the area of investment, actuaries are involved in a range of work such as: pricing financial derivatives, working in fund management, or working in quantative investment research. Often investment actuaries work in fields where their understanding of insurance or pension liabilities helps them to manage the investment of the corresponding assets.
The work carried out by actuaries in insurance includes designing new insurance policies, setting premium rates, calculating a company’s financial status (based on the policies already sold), and answering technical queries from policyholders. Insurance actuaries also undertake detailed investigations of different experiences; such as how assets and expenses have performed and the extent of different types of claims for different types of insurance policies (eg death claims for life insurance or car theft for motor insurance).
Pensions & Employee Benefits
In the pensions field, actuaries are usually involved in designing and advising company pension schemes, especially where a value needs to be placed on a scheme’s accumulated pension promises. Actuaries are also involved in designing schemes for employee benefits.
Source: www.actuaries.org.ukPages: 1 2 3 4 5 6