An actuary is a business professional who analyzes the financial consequences of risk. He uses mathematics, statistics and financial theory to study uncertain future events. They work more in the areas of insurance and pension programs.
Actuaries may work for insurance companies, government jobs, employee benefits departments of large corporations, investment firms, banks and in businesses that need to manage financial risk. They work on determining future risk, market price decisions and also formulate investment strategies. Most actuaries specialize in life and health or property and casualty insurance; others work primarily in the field of finance or employee benefits. Actuaries draw a salary ranging from $45,000 to $55,000. The median annual wage of actuaries was $87,650 in May 2010.
Actuary job description
In the 1990s actuarial science combined financial theory and stochastic methods to help businesses assess risks of certain events occurring so that they can plan to minimize that risk. Actuaries can also help address pension issues by providing information on pension contributions required for a certain retirement income. An actuary can guide investment based on possible maximizing on returns in the wake of potential risks.
Actuaries determine the cost of financial liabilities that have already occurred, called retrospective reinsurance, or the development or re-pricing of new products.
Reinsurance actuary: In this area, one insurance company arranges to share a large prospective liability policy with another insurance company in exchange for a percentage of the premium.
Property/casualty actuary: They calculate the expected amount of claims resulting from automobile accidents. This depends on the insured person's age, sex, driving history, type of car, and other factors. Actuaries make sure that the price, or premium, charged for such insurance will enable the company to cover claims and other expenses.
Actuaries are consulted by lawyers in civil suits for computation of losses or income. Actuary jobs can be sought in government departments to calculate the costs of new services or savings due to new schemes or new sources of revenue.
Actuary job prospects
Disciplines in the insurance field wherein an actuary works include:
Insurance sectors include: Property, People (other than health and life), Auto insurance, Homeowners insurance, Title insurance, Homeowners insurance, Commercial property insurance, Malpractice insurance, Marine insurance, Products liability insurance, Terrorism insurance.
An Actuary analyzes the possible outcomes and types of events that could possibly lead to a situation wherein a policyholder makes claims against his/her insurance policies. He tries to assess the costs associated, if claim could occur.
Skills are required in areas of:
Training for actuary jobs
To become an accredited actuary one has to pass a rigorous series of professional examinations. Clearing the preliminary exams is the common foundation towards becoming an actuary. The computer-based exams are conducted by Society of Actuaries (SOA), Casualty Actuarial Society (CAS) and Canadian Institute of Actuaries (CIA). A mathematics-related bachelor's degree helps prepare students to take actuary exams.