Actuarial

Entry requirements
What you might do
Training and professional qualifications
Rewards
Prospects
Useful links

Actuaries provide the mathematical and analytical foundations for financial decision-making.

Insurance protects people against the possibility of unwelcome events, but how likely are such events to happen? Actuaries assess risks, based on what has occurred in the past, using statistics and applying probability theory. Armed with such data, they are able to calculate premiums and advise on whether or not a company has sufficient assets to meet its potential and actual liabilities.

The work of actuaries impacts on every aspect of insurance business and they must ensure that their companies are solvent, competitive and innovative. As they are often called upon to advise senior managers on commercial matters and investments, the ability to communicate effectively with non-specialists is important.

Entry requirements

This route is open to all graduates, but you must have a minimum of grade B in A-level mathematics or equivalent, unless your degree is in mathematics or actuarial science.

Preferred subjects include:

actuarial mathematics
actuarial science
business
economics
engineering
mathematics
physical/applied science
statistics

Some employers require specific degree subjects or an MSc in Actuarial Science. Contact the Institute of Actuaries or the Faculty of Actuaries (see useful links below) for further details.

What you might do

Actuaries assess probabilities and risk by analysing past events. Much of the work typically involves mathematical modelling and statistical analyses, as well as writing and presenting reports that explain degrees of risk and associated cost implications.

New graduates will typically work in teams that support senior colleagues, with tasks ranging from carrying out calculations to preparing papers for client meetings.

Actuaries also work with other professionals - for example IT experts - to develop and implement modelling and aggregation tools for financial reporting and risk applications, and to ensure regulatory compliance.

In insurance companies, actuaries:

conduct periodic valuations of assets and liabilities
calculate funding rates for pension schemes and bonuses for customers whose policies include investment profits
oversee asset liability modelling and profit testing.

They are also likely to be involved in funding and investment decisions, in the development of new policies, and in legal and taxation issues.

Training and professional qualifications

To become a professional actuary you must be prepared to study, train and qualify to be a Fellow of either the Faculty of Actuaries (Scotland) or Institute of Actuaries (the rest of the UK). These bodies operate under the joint name of the Actuarial Profession and are of equal status.

Most actuarial students study while in full-time employment, so the choice of which qualifying body is largely determined by the alignment of your employer. Qualification - which involves correspondence courses with regular tutorials and block revision courses leading to examinations - takes around three to six years.

To qualify, you'll need to pass a series of professional examinations, which cover mathematical, statistical and financial techniques, as well as the four main areas of actuarial practice - investment and asset management, life insurance, general insurance, and pensions and other benefits.

You'll need to be ambitious and determined, and prepared to sacrifice evenings and weekends to intense personal study, although most employers offer study leave (up to 40 days a year) and some provide support with fees and study materials.

Rewards

Actuaries tend to hold senior management positions in insurance companies and remuneration is correspondingly high. Typical starting salaries for graduates are around ï¿½25,000, depending on location, with newly qualified actuaries in insurance companies earning from ï¿½45,000.

Experience and performance are typically well rewarded. Excellent benefits packages are common, with salaries of more than ï¿½100,000 possible for senior actuaries.

Prospects

Once qualified, actuaries can progress quite quickly to managerial positions. It is possible to advance within the actuarial specialism or to move into related areas, working in investment systems, financial modelling, software or product development, marketing and sales or general administration.