Legal, finance and accounting
Actuary
Analysing data to predict the likelihood and potential financial risk of future events.
Summary
Actuaries work in a very niche industry with only approximately 450 qualifying each year. The actuarial profession however is still a diverse sector, working in the areas of insurance, pensions, healthcare, investment and the growing area of financial risk management. The role, responsibilities and exams that are required as an Actuary require individuals to stretch their abilities to a very high level. Actuaries use mathematical skills to measure the probability and risk of future events, and the financial impact on a business and/or individuals. Actuaries are highly regarded professionals who are both problem solvers and strategic thinkers and have a deep understanding of financial systems. Actuarial teams analyse data, build mathematical models to evaluate financial risks and communicate the output to non-specialists. The majority of actuaries work for insurance companies (life, health or general) or for financial or pensions consultancies. Insurance company actuaries typically work in areas such as pricing and product development, reserving, capital modelling and risk management. Work for insurance consultancy firms may be in similar areas but more varied on a day-to-day level. Amongst other things, pensions consultants advise private and public pension providers and trustees about the funding levels in their schemes and the contributions required to meet future pensions. They may also help their clients understand and manage the risks they face. However, an increasing number of actuaries are working in less traditional fields such as banking, investment management, corporate finance and anywhere where financial modelling is deemed useful. Actuaries are required to act in the public interest and must therefore maintain the highest standards of professional conduct and competency; upholding ethical behaviour and integrity at all times. An actuarial apprenticeship is a professional career route supported by the Institute and Faculty of Actuaries (IFoA). The apprenticeship will result in a breadth of knowledge, skills and behaviours, bringing wide and varied opportunities within this leading financial profession.
Typical job titles include
- Capital actuary | Financial actuary | Insurance Actuary | Pensions actuary | Pricing actuary | Scheme actuary | Climate Actuary | Climate Change Actuary | ESG Actuary | Sustainability Actuary
Knowledge, skills and behaviours (KSBs)
K1:
The mathematical and statistical techniques that are of particular relevance to actuarial work
K2:
The essential features of statistical distributions and how to summarise data using appropriate descriptive statistics and graphical presentations
K3:
The principles of modelling as applied to actuarial work, including deterministic models, stochastic processes, survival models and the valuation of derivatives
K4:
The requirements of a good model and the mathematical techniques used to model cash flows which may be contingent on other events
K5:
The fundamentals of corporate finance including a basic knowledge of the instruments used by companies to raise finance and manage financial risk
K6:
The core economic principles (of both microeconomics and macroeconomics) and how these can be used in a business environment to help decision making and behaviour
K7:
The essential risk management techniques and processes required by all actuaries
K8:
The risks faced both by individuals and groups who might effect financial products and also by the providers of such products
K9:
The principles and techniques used to manage these risks
K10:
The key techniques used by the providers of financial products to ensure that promised liabilities can be met
K11:
The wider business context in which actuaries work, including an understanding of the external and internal business environments, business strategy, business culture and the importance of leadership and teamwork within an organisation
Technical Educational Products
- ST0502: Actuary (Level 7) Approved for delivery
- Reference:
- OCC0502
- Status:
Approved occupation
- Average (median) salary:
- £49,873 per year
- SOC 2020 code:
- 2433 Actuaries, economists and statisticians
- SOC 2020 sub unit groups:
- 2433/01 Actuaries and actuarial analysts
- 2433/02 Economists
- 2433/03 Mathematicians
- 2433/04 Statistical data scientists
- 2433/99 Actuaries, economists and statisticians n.e.c.
S1:
Apply tools and techniques to assist strategic thinking needed for a role in wider management
S2:
Interpret the accounts and financial statements of companies and financial institutions
S3:
Build a model, analyse the data, methods used and outputs generated and document the work (including maintaining an audit trail for a fellow student and senior actuary)
S4:
Communicate the approach, results and conclusions to a senior actuary
S5:
Communicate effectively, both written and orally, when relating concepts used by actuaries to recipients without specialist actuarial expertise, using effective structure, appropriate language and adequate explanation
S6:
Apply actuarial techniques to analyse business problems and then formulate, justify and present plausible solutions for consideration
Technical Educational Products
- ST0502: Actuary (Level 7) Approved for delivery
- Reference:
- OCC0502
- Status:
- Approved occupation
- Average (median) salary:
- £49,873 per year
- SOC 2020 code:
- 2433 Actuaries, economists and statisticians
- SOC 2020 sub unit groups:
- 2433/01 Actuaries and actuarial analysts
- 2433/02 Economists
- 2433/03 Mathematicians
- 2433/04 Statistical data scientists
- 2433/99 Actuaries, economists and statisticians n.e.c.
B1:
A responsibility for your own personal and professional development
B2:
Commitment to the Actuaries Code
B3:
Professional and ethical standards in the actuarial work undertaken
B4:
Commitment to the role of peer review in professional work
B5:
Teamwork skills (by effectively liaising with a large and diverse range of colleagues to complete a task)
B6:
Good time management (by managing work effectively to prioritise tasks appropriately, inform stakeholders, peers and/or senior colleagues if anticipated deadlines may not be met)
B7:
An aptitude for personal and professional development (by producing a development plan and seeking appropriate training or reading material)
B8:
The personal and professional development requirements of the Institute and Faculty of Actuaries
Technical Educational Products
- ST0502: Actuary (Level 7) Approved for delivery
- Reference:
- OCC0502
- Status:
- Approved occupation
- Average (median) salary:
- £49,873 per year
- SOC 2020 code:
- 2433 Actuaries, economists and statisticians
- SOC 2020 sub unit groups:
- 2433/01 Actuaries and actuarial analysts
- 2433/02 Economists
- 2433/03 Mathematicians
- 2433/04 Statistical data scientists
- 2433/99 Actuaries, economists and statisticians n.e.c.
