Source: www.actuaries.org.

uk

What is an actuary?
What is an actuary? Actuaries are experts in risk management. They use their mathematical skills to help measure the probability and risk of future events. This information is useful to many industries, including healthcare, pensions, insurance, banking and investments, where a single decision can have a major financial impact. Actuaries in the UK belong to the Institute and Faculty of Actuaries. It is a global profession with internationally-recognised qualifications. It is also very highly regarded, in the way that medicine and law are, and an actuarial career can be one of the most diverse, exciting and rewarding in the world. In fact, due to the difficult exams and the expertise required, being an actuary carries quite a reputation. What skills do actuaries have? People who work as actuaries come from all sorts of backgrounds, though clearly they share a love of maths. Actuaries are problem solvers and strategic thinkers with a deep understanding of financial systems. On the way to achieving a qualification, you'll develop these and other key skills - analysing data, evaluating financial risks, communicating clearly through exams and work-based training. Who should become an actuary?

A graduate typically with a 2:1 in a numerate subject (others may be suitable) Loves logic and problem solving Good communicator Excellent business acumen

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What does an actuary do?

Out of our 23,950 members

Pensions, 22%

Life Insurance, 27 %

General Insurance, 12 %

22% work in Pensions 27% work in Life Insurance 12% work in General Insurance 5% work in Investment 2% work in Education 1% work in Health and Care 33% work in other sectors

Others, 33%

Health and care, 1%

Education, 2%

Investment, 5 %

What are the main industry sectors I could work in? Actuaries' skills are in great demand throughout the financial sector, particularly in investment, insurance and pensions. Actuaries are also increasingly employed in risk management for large companies. However, actuarial consultancies are probably the biggest employers of actuaries in the UK. There are many areas where actuaries work, including; Consultancies - offering advice on issues such as acquisitions, mergers and financing capital projects, and also on occupational pension schemes Investment - involved in research and on the pricing and management of investments, particularly in mitigating the risk of investments Insurance - providing a service to companies which need a huge range of numerical information investigated, analysed and explained; for example to create and price polices, or to ensure they have the money to cover claims Pensions - designing and advising on company pension schemes, especially placing a value on accumulated pension commitments. What kind of projects do actuaries work on? Every area of business is subject to risks so an actuarial career offers many options. A typical business problem might involve analysing future financial events, especially when elements are uncertain. But it could also involve understanding something like the weather: assessing when and where devastating storms may hit and their associated costs, for investments or insurance. Due to an actuary's skill the opportunities open to them are endless, they can even be employed in the marketing and development of financial products. What skills do I need? Understanding how businesses operate is vital, but what really sets actuaries apart is their natural mathematical, economic and statistical awareness, and their ability to apply this to real business issues. The ability to communicate these difficult topics to non-specialists is also very important. Find out more about the skills that you need at each stage of qualification.

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Can I work in other areas? The skills that you will gain as an actuary will be invaluable to you in your future career, whether that is as an actuary or other. Many actuaries change practice area and career paths. They move into teaching, alternative risk roles, consultants, business operations managers, career advisers the list is endless. Can I work abroad? Yes - With the skills you will gain with the UK Profession, they can take you anywhere in the world. With mutual recognition agreements with some of the other actuarial professional bodies, once you have qualified it may be easy to transfer to another professional body if your work takes you that way.

Skill sets of actuaries

Associates skill set
Associates of the Institute and Faculty of Actuaries use financial and statistical techniques to solve real business problems, particularly those involving risk management. These business problems typically involve analysing future financial events, especially when the amount of a future payment, or the timing of when it is paid, is uncertain. Associates will have sufficient technical understanding to solve all but the most demanding financial and risk management problems in the following areas: pensions, life and general insurance, investment, corporate finance, enterprise risk management, healthcare. They will also be able to communicate fundamental actuarial ideas and arguments to others outside the profession in a way that takes account of the needs of the audience. Associates will have sufficient knowledge of the broad commercial and financial environment to understand the immediate implications of their work for their client or employer, and will work to the highest professional and ethical standards. However, the qualification, of itself, does not imply that they have the depth of knowledge in a specialist subject possessed by a Fellow; nor that they are able to identify a particular technical solution as optimal in the context of the wider business environment. An Associate cannot undertake UK reserved actuarial roles but may be recognised as a fully qualified actuary in some other jurisdictions (subject to local experience requirements).

Fellows skill set

Fellow of the Institute and Faculty of Actuaries uses financial and statistical techniques to solve real business problems, particularly those involving risk management. These business problems typically involve analysing future financial events, especially when the amount of a future payment, or the timing of when it is paid, is uncertain. Fellows will have a wide technical understanding of the following areas: pensions, life and general insurance, investment, corporate finance, enterprise risk management, healthcare; and a deep technical understanding of at least one of them. They will also be able to communicate fundamental actuarial ideas and arguments to others outside the profession in a way that takes account of the needs of the audience. In a broad range of business and financial contexts they can analyse the needs of a client or employer and identify an optimal solution. If the solution is within their own area of expertise they can

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provide comprehensive professional advice. Where they have identified the need for additional expertise, they can interpret the advice of other experts and synthesize an appropriate solution. Fellows will work to the highest professional and ethical standards and can fulfil all the UK statutory responsibilities of an actuary and undertake actuarial reserved roles (subject to professional practising certificate requirements) and will be recognised as a fully qualified actuary in most other jurisdictions (subject to local experience requirements).

Actuarial Quality Framework

The Actuarial Quality Framework published by the Financial Reporting Council aims to assist: Actuaries - in seeking to provide high quality actuarial work for the benefit of users. Actuaries' direct clients and employers, as well as their representatives and advisers - in evaluating the quality of actuarial information and advice and making appropriate decisions based on it. All stakeholders including end-users and their representatives - in evaluating the effectiveness with which actuarial quality is being promoted and achieved on their behalf. Regulators, including professional bodies - in undertaking and reporting on the regulation of actuaries and the entities they inform and advise.

Where do actuaries work?

Of the 10,498 Fellows of the Profession, 72% are in the UK, 8% in the rest of Europe and 20% in the rest of the world. 35% of those Fellows work in Insurance, 37% work in consultancy, 7% work in finance and investment and 4% work in the public sector and education, as well as other newer areas such as industry. Insurance and Consultancy - what is the difference? Working in an insurance company environment means that there is usually only one client; your employer. A variety of work is available but tends to come more slowly often youll be asked to work in one area for a period of about one year before moving on to the next challenge, taking the experience you have gained with you. The day to day work within consultancy firms tends to be more varied, as in any year you are likely to work for a number of different clients solving different types of problems. This can become particularly challenging if you have a number of projects running in parallel and you need to ensure that you meet and manage each of your clients expectations and deadlines. This can give you an excellent opportunity to work with other people and see the running of an organisation other than your own. You may also find yourself working on just part of a project rather than seeing it all the way through from start to finish. Consultancy Actuarial consultancies are the biggest employers of actuaries in the UK. Consultancies will offer a range of services to their clients, such as pensions, enterprise risk management, merger and acquisition advice, corporate recovery and financing capital projects. The Page 4 of 8

Government Actuarys Department (GAD) provides advice to the Government via Royal Commissions, as well as giving advice to other government departments and a wide range of public sector bodies, including local authorities and the NHS. Insurance industry Life insurance Life insurance companies provide life insurance, pensions and other financial services. Actuaries are involved at all stages in the product development and in the pricing, risk assessment and marketing of the products. With recent legislation leading to more private healthcare provision, insurance companies are extending their range of products to include medical insurance, critical illness and disability insurance. General insurance General insurance is a fast-growing area for actuaries, both within insurance companies and consultancies as well as reinsurance and broking operations. General insurance includes personal insurance, such as home and motor insurance, as well as insurance for large commercial risks. Terrorist attacks, Caribbean windstorms and industrial diseases like asbestosis are all examples of insurance liabilities where actuaries have been integrally involved in estimating ultimate costs into an uncertain future. Finance and investment Investment management Actuaries have been involved in the field of investment management for decades. Indeed, it is probably true to say that more people see the word actuaries through the daily stock exchange indices than through any other source. Actuaries are involved in buying and selling assets, investment analysis and portfolio management. Many employers recognise the skills that the training provides and have allowed actuaries to develop these skills as well as others, such as the skills of financial economists. Corporate finance Although generally regarded as the province of the investment banker, actuaries can add value in this area. An actuarys basic skills in forecasting and assessing risks are ideal for estimating whether a capital project (e.g. for a new hospital or a transport infrastructure project) is financially viable. Employers might include government departments, management consultancies, or property companies. Banking Actuaries are becoming increasingly involved in banking. For example, some of the leading insurance companies now have their own established banking operations, with actuaries filling some of the senior executive positions for finance and risk. The leading retail banks are also increasingly employing actuaries, as they recognise that the longer term approaches advocated by actuaries can add value to their businesses. As the insurance and Page 5 of 8

banking markets continue to converge, we can expect to see the demand for actuaries within banking fields continue to grow. Opportunities abroad The UK qualification is highly valued throughout the world. Of the qualified members of the UK profession, 60% are UK based, with the remainder overseas. TheIFoA works with other international actuarial bodies to arrange reciprocal recognition of the professional qualifications between the different bodies.

Why become an actuary?

There are many reasons people find becoming an actuary a satisfying and stimulating career.
The variety of work You can work in specialist areas of insurance, pensions, benefits, healthcare, investments and banking, or for any large organisation where risk management plays an important role, or for a consultancy advising on all sorts of different projects. An influential role The unique skills of actuaries are behind many high-level strategic decisions made by large companies and governments, and can have a positive impact on legislation, businesses and individuals. The rewards Salaries and benefits packages are excellent from the beginning. In fact, it's one of the highest paid professions. Intellectual satisfaction Actuaries are problem solvers, in tune with what's happening in business through their interpretation of statistical data and knowledge of social and economic systems. International opportunities Once you're qualified, actuarial skills can take you anywhere in the world. High standards Actuaries combine good business sense with safeguarding the public's financial interests, upholding the highest professional standards.

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A good life balance There is flexibility to balance professional commitments with personal interests.

How to become an actuary

It takes on average between three and six years to qualify as an actuary, but the rewards are well worth the effort. Most actuaries start their training once they graduate, but the information below also applies to people entering from another career.
Step 1 - Take an A-Level or a Higher in maths or an equivalent You'll definitely need this to become an actuary. But it's worth noting that whatever you eventually decide to do, taking maths will broaden your career options. Step 2 - Get a good degree For most actuarial employers, a 2.1 or better is essential. Any subject is acceptable, but employers prefer candidates with numerate degrees such as actuarial science, maths, stats, economics, engineering, chemistry or physics. We have links with universites with accreditation or exemption agreements, do you want to find out more? Step 3 - Find a trainee position Join an actuarial firm and develop your skills while you qualify. Your careers adviser can help, and you can download aDirectory of actuarial employers offering work experience or graduate trainee positions, or visit the actuaries pages of theInside Careers website. There is no age limit for joining the profession. If you're interested in changing from another career or profession, we usually recommend you undertake one or two of our examinations independently, to assess your skills. Your experience in your current career may be valuable to an actuarial firm, and you may wish to contact actuarial employers directly to discuss your potential. Step 4 - Register as an actuarial student and gain your qualifications To become an Associate or Fellow of the Institute and Faculty of Actuaries you must pass our examinations, or be granted exemption from them, and also attain a satisfactory level of work-based skills. This usually takes between three and six years. You study by distance learning, and many employers offer support for study, some offering paid study leave during your training. In the Students section of this website you can learn all about the qualifications you need to enter the profession, how and when to apply for student membership, and you can download and complete an application form. Our qualifications shows you what exams you need in order to qualify as an Associate or Fellow of the Profession. TheStudent Handbook is a helpful resource in outlining the route through the exams we recommend. Step 5 - Enjoy a job anywhere in the world Within the actuarial profession there are many different and exciting career paths, and once you're qualified, your skills can take you anywhere. Some actuaries specialise in technical research, while

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others may focus more on commercial activities. Most go on to be practising specialists in one of the traditional financial fields, with many becoming senior managers in insurance companies or firms of consultants.

What can an actuary earn?

Wherever you go in the world, you'll find the actuarial profession is one of the highest paid.
Here is the basic salary you might expect to earn at different levels of responsibility.

Responsibility level Chief actuary, senior partner Senior function head, practice director Function head, practice head Department manager, managing consultant Section manager, senior consultant Section leader, consultant Senior actuary, junior consultant Actuary Student actuary

Average basic salary () 221,250+ 134,343 110,747 87,557 81,239 67,298 59,836 46,515 32,842

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