Published By Team Setmycareer on Sep 15, 2023
Explore the world of Actuarial Scientists and understand why they are the financial wizards behind risk assessment and decision-making in insurance and finance.
Actuaries are business professionals who deal with the financial impact of risk, usually involving an individual or business. They use their understanding of mathematics, statistics, historical data and financial systems to evaluate the likelihood of events and their inherent risk. Actuaries use their wide range of knowledge in the fields of math and statistics as well as business and finance probability to determine the premiums of insurance plans. They calculate the risk factors for occurrences such as floods, fires, unemployment, accidents, mortality, and other risks to give an accurate depiction of the risk that insurance companies will take by insuring an individual or business.
Actuaries work with insurance companies that specialize in many things including life insurance, health insurance, automobile insurance, and homeowners insurance. Actuaries in the insurance industry typically specialize in a specific field of insurance, such as Health insurance actuaries, Property and casualty insurance actuaries, Pension and retirement benefits actuaries, Life insurance actuaries and Enterprise risk actuaries. Most actuarial work is done with computers.
Actuaries use database software to compile information. They use advanced statistics and modeling software to forecast the probability of an event occurring, the potential costs of the event if it does occur, and whether the insurance company has enough money to pay future claims. The duties of Actuary includes to compile statistical data and other information for further analysis, estimate the probability and likely economic cost of an event such as death, sickness, an accident, or a natural disaster. They also design, test, and administer insurance policies, investments, pension plans, and other business strategies to minimize risk and maximize profitability.
They also produce charts, tables, and reports that explain calculations and proposals and explain their findings and proposals to company executives, government officials, shareholders, and clients.
Most actuaries have an undergraduate degree in mathematics, statistics, economics, finance, or business. Coursework should include advanced math and statistics courses. A strong background in calculus, probability, and mathematical statistics is essential.
To start on the path to becoming an actuary, you'll need to pass 2-3 initial actuarial exams like Exam P, FM, IFM, etc. These are very difficult exams offered by actuarial societies like SOA or CAS. They test your competence in actuarial mathematics, statistics, and other concepts.
Try to find an entry-level position at an insurance company, consulting firm, bank, or other financial services company. Many employers sponsor further exam studies. The work experience will complement your education.
There are 7-9 additional exams to become a fully credentialed actuary. They cover more advanced actuarial science topics. You must pass 2-3 more to become an Associate Actuary. Passing all qualifying exams can take 5-10 years.
After passing exams, meeting experience requirements, and following actuarial standards, you can get credentialed as a Fellow of Society of Actuaries (FSA) or a Fellow of Casualty Actuarial Society (FCAS).
Actuaries must continuously update their skills as regulations, policies, and statistical techniques change. Lifelong learning and skills development are critical.
Actuaries play a vital role in the financial world, using their expertise in mathematics, statistics, and risk assessment to help individuals and organizations make informed decisions about their financial futures. As we've explored in this article, actuaries are involved in a wide range of industries, from insurance to finance to government, and their work has a profound impact on our daily lives.
We understand that making important career choices can be overwhelming and uncertain. The decisions you make today will shape your professional journey and have a lasting impact on your life. That's why we highly encourage individuals like you to talk to our experts before making any significant career decisions. Our team of experienced career counselors is here to provide you with the guidance and support you need to make informed choices that align with your aspirations and goals.