What
is an actuary?
“Actuary” means a person skilled in determining the present effects
of future contingent events or in finance modelling and risk analysis in
different areas of insurance, or calculating the value of life interests and
insurance risks, or designing and pricing of policies, working out the benefits
recommending rates relating to insurance business, annuities, insurance and
pension rates on the basis of empirically based tables and includes a
statistician engaged in such technology, taxation, employees’ benefits and such
other risk management and investments and who is a fellow member of the
Institute.
What
does Actuaries do?
a) Actuaries Make
Financial Sense of the Future
Actuaries are
experts in assessing the financial impact of tomorrows uncertain events. They
enable financial decisions to be made with more confidence by:
· Analyzing the
past
· Modelling the
future
· Assessing the
risks involved, and
· Communicating
what the results mean in financial terms.
b) Actuaries
Enable More Informed Decisions:
Actuaries add
value by enabling businesses and individuals to make better-informed decisions,
with a clearer view of the likely range of financial outcomes from different
future events.
The Actuaries
skills in analysis and modelling of problems in finance, risk management and
product design are used extensively in the areas of insurance, pensions,
investment and more recently in wider fields such as project management,
banking and health care. Within these industries, actuaries perform a wide
variety of roles such as design and pricing of product, financial management
and corporate planning.
Actuaries are
invariably involved in the overall management of insurance companies and
pension, gratuity and other employee benefit funds schemes; they have statutory
roles in insurance and employee benefit valuations to some extent in social
insurance schemes sponsored by government.
Actuarial skills
are valuable for any business managing long-term financial projects both in the
public and private sectors.
Actuaries apply
professional rigor combined with a commercial approach to the decision -making
process.
c) Actuaries
Balance the Interests of All
Actuaries balance
their role in business management with responsibility for safeguarding the
financial interests of the public. The duty of Actuaries to consider the public
interest is illustrated by their legal responsibility for protecting the
benefits promised by insurance companies and pension schemes. The professions
code of conduct demands the highest standards of personal integrity from its
members.
Who
can become an Actuary?
• An HSC passed,
graduate, post graduate, Engineer, MBA, CA, ICWA etc with sound knowledge in
Mathematics & Statistics
• Loves logic and
problem solving
• Good
communicator
• Excellent
business awareness
As actuaries move
into newer roles in addition to the traditional roles, there is a need for
students to have the clarity of what exactly is actuarial sciences, why should
they become an actuary and what does it take to become an actuary.
Typically, an
Actuary uses financial and statistical techniques to solve real business
problems, particularly that involving risk management. But what sets them apart
from their counterparts in other professions is the natural mathematical,
economic and statistical aptitude, awareness and the ability to apply these to
situations in the real financial world. When a student becomes a member of the
Institute of Actuaries of India, he already possesses some of the skills
required to make him an excellent actuary someday. As he takes one exam after another,
he acquires the skills that make him a successful actuary. It takes a lot of
patience, grit and determination to get there and when you are there, financial
success is just incidental.
Institute: Institute of Actuaries of India
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