Actuaries produce charts, tables, and reports to explain their calculations. If you’re thinking of going to school or going back to school for a mid-life career change, this job is a great option.
Actuaries, who are crucial to the insurance industry, analyze the financial costs of risk and uncertainty. They use mathematics, statistics, and financial theory to assess the risk of potential events. They also help develop policies to minimize the cost of that risk.
Other Job Titles
- Actuarial Analyst
- Actuarial Associate
- Actuarial Consultant
- Consulting Actuary
- Health Actuary
- Pricing Actuary
- Pricing Analyst
- Product Development Actuary
- Retirement Actuary
Actuary Job Duties
- Compile statistical data for analysis
- Estimate the economic cost of a death, sickness, an accident, or a natural disaster
- Design, test, and administer insurance policies, investments, pension plans, and other business strategies to minimize risk and maximize profitability
- Produce charts, tables, and reports that explain calculations and proposals
- Explain findings and proposals to company executives, government officials, shareholders, and clients
Is Being an Actuary a Good Career for You?
According to the O*NET career and personality test, this profession appeals to people with conventional, investigative and enterprising interests.
Conventional occupations frequently involve following set procedures and routines.
These occupations can include working with data and details more than with ideas.
Investigative occupations frequently involve working with ideas, and require an extensive amount of thinking.
These occupations can involve searching for facts and figuring out problems mentally. Actuaries have to focus on the problem and determine potential risk from all angles.
Finally, enterprising occupations frequently involve starting up and carrying out projects. These occupations can involve leading people and making many decisions. Sometimes they require risk taking and often deal with business.
INTP personality types natural numbers people. They excel in math and analyzing data. They love finding patterns and don’t really need interaction with people to get the job done.
Work Styles Required to be an Actuary
- Analytical Thinking — This job requires analyzing information and using logic to address work-related issues and problems.
- Attention to Detail — You should be careful about detail and thorough in completing work tasks.
- Integrity —You must be honest and ethical.
- Achievement/Effort — You must establish and maintain personally challenging achievement goals and push yourself to meet them.
- Dependability — You should be reliable, responsible, and dependable, and fulfilling obligations.
Being an Actuary Fulfills These Work Values
- Working Conditions Actuaries have job security and good working conditions.
- Achievement This job is results-oriented and allows employees to use their strongest abilities, giving them a feeling of accomplishment.
- Independence —You can have the freedom to work on your own and make decisions.
Actuaries are Tech and Team Savvy
Most actuarial work is done with computers. Actuaries use database software to compile information.
They use statistics and modeling software to forecast the likelihood of an event occurring. They also calculate the potential costs of the event if it does occur.
As part of the actuary job description, an actuary must also decide if the insurance company has the money to pay future claims.
A lot of actuaries work as part of a team of managers and professionals in other fields, such as accounting, underwriting, and finance.
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Where Do Actuaries Work?
As you might guess from the actuary job description, most actuaries work at insurance companies, where they help design policies and determine the premiums that should be charged for each policy.
They must ensure that the premiums are profitable yet competitive with other insurance companies.
Actuaries held about 22,260 jobs in 2019. The largest employers of actuaries were:
|Finance and insurance||71%|
|Professional, scientific, and technical services||15%|
|Management of companies and enterprises||6%|
Actuaries in the insurance industry usually have a specialty. Here is an actuary job description for some of the more popular choices.
Health insurance actuary job description: These actuaries help develop long-term care and health insurance policies by predicting the costs of care under the terms of an insurance contract.
Life insurance actuary job description: are tasked with figuring out annuity and life insurance policies for individuals and groups.
Property and casualty insurance actuary job description: They help develop insurance policies to protect people from property loss and liability. Property loss can come from accidents, natural disasters, fires, and theft.
Some actuaries put their skills to work in financial matters outside of the insurance industry. For example, they work on investment strategies.
Pension and retirement benefits actuary job description: These actuaries design, test, and evaluate company pension plans. They have to determine if future funds will be enough to pay out on future benefits. They report the results to the federal government.
Pension actuaries also help businesses develop other types of retirement plans, such as 401(k)s and healthcare plans for retirees. In addition, they provide retirement planning advice to individuals.
Enterprise risk actuary job description: These professionals identify any risks, including economic, financial, and geopolitical risks that may affect a company’s short-term or long-term objectives.
Top Actuary Jobs
How to Become an Actuary
- Mathematics — Knowledge of arithmetic, algebra, geometry, calculus, statistics, and their applications.
- Economics and Accounting — Knowledge of economic and accounting principles and practices, the financial markets, banking and the analysis and reporting of financial data.
- English Language — Knowledge of the structure and content of the English language including the meaning and spelling of words, rules of composition, and grammar.
- Computers and Electronics — Knowledge of circuit boards, processors, chips, electronic equipment, and computer hardware and software, including applications and programming.
- Law and Government — Knowledge of laws, legal codes, court procedures, precedents, government regulations, executive orders, agency rules, and the democratic political process.
- Critical Thinking — Using logic and reasoning to identify the strengths and weaknesses of alternative solutions, conclusions or approaches to problems.
- Judgment and Decision Making — Considering the relative costs and benefits of potential actions to choose the most appropriate one.
- Mathematics — Using mathematics to solve problems.
- Reading Comprehension — Understanding written sentences and paragraphs in work-related documents.
- Active Listening — Giving full attention to what other people are saying, taking time to understand the points being made, asking questions as appropriate, and not interrupting at inappropriate times.
- Mathematical Reasoning — The ability to choose the right mathematical methods or formulas to solve a problem.
- Number Facility — The ability to add, subtract, multiply, or divide quickly and correctly.
- Deductive Reasoning — The ability to apply general rules to specific problems to produce answers that make sense.
- Inductive Reasoning — The ability to combine pieces of information to form general rules or conclusions (includes finding a relationship among seemingly unrelated events).
- Near Vision — The ability to see details at close range (within a few feet of the observer).
Actuaries need a bachelor’s degree and must pass exams to become certified.
Actuaries need a bachelor’s degree, typically in mathematics, actuarial science, statistics, or some other analytical field. Students must complete coursework in:
- Applied statistics
- Corporate finance
Students also should take classes outside of mathematics and business to prepare them for a career as an actuary.
Coursework in computer science, especially programming languages, and the ability to use and develop spreadsheets, databases, and statistical analysis tools, are valuable.
Classes in writing and public speaking will improve students’ ability to communicate in the business world.
Two professional societies—the Casualty Actuarial Society (CAS) and the Society of Actuaries (SOA)—sponsor programs leading to full professional status. The CAS and SOA offer two levels of certification: associate and fellow.
How Long Does It Take to Be an Actuary?
It typically takes 4 to 7 years for an actuary to earn the associate-level certification, because each exam requires hundreds of hours of study and months of preparation.
After becoming associates, actuaries typically take 2 to 3 more years to earn fellowship status.
The SOA offers fellowship certification in five separate tracks:
- life and annuities
- group and health benefits
- retirement benefits
- finance/enterprise risk management
Most entry-level actuaries start out as trainees. They are typically on teams with more experienced actuaries who serve as mentors.
At first, they perform basic tasks, such as compiling data, but as they gain more experience, they may conduct research and write reports.
Beginning actuaries may spend time working in other departments, such as marketing, underwriting, and product development, to learn all aspects of the company’s work and how actuarial work applies to each one.
Most employers support their actuaries throughout the certification process.
For example, employers typically pay the cost of exams and study materials.
Many firms provide paid time to study and encourage their employees to set up study groups. Employees usually receive raises or bonuses for each exam that they pass.
How Much Do Actuaries Make?
The median annual wage for actuaries was $108,350 in May 2019. Half of the workers in this job earned more than that amount and half earned less. The lowest 10 percent earned less than $64,860, and the highest 10 percent earned more than $193,600.
The average salary for actuaries was $120,970 as of May 2019.
2019 Actuary Salaries: Which State Pays the Most?
|Location||# Employed||Median |
|New York||2,330||$ 137,510|
|District of Columbia||160||$ 126,070|
|North Carolina||**||$ 123,200|
|New Jersey||850||$ 110,100|
|Rhode Island||80||$ 96,860|
|South Carolina||60||$ 76,240|
|Puerto Rico||40||$ 57,540|
Jobs are Projected to Grow by 20%
Employment of actuaries is projected to grow 20 percent from 2018 to 2028, much faster than the average for all occupations. However, because it is a small occupation, 5,000 new jobs over the 10-year period would be created.
If you already have a degree in math, statistics, or finance getting into this career will not take as long as someone who does not have the required education.
Insurance companies are driving the growth as they analyze the large amount of information, such as medical or property data, collected from consumers.
The increase in available data will allow insurance companies to better develop new products, set competitive prices, predict consumer behavior, and make more accurate projections of future risks and costs.
Job opportunities may be competitive for entry-level applicants because the number of students sitting for actuarial exams has increased in the past few years.
Students who have passed at least two actuarial exams, have had an internship while in college, and have strong analytical and business skills should have the best job prospects for entry-level positions.
For more information about actuaries, visit American Academy of Actuaries
For more information about actuaries in property and casualty insurance, visit Casualty Actuarial Society
For more information about actuaries in life and health insurance, retirement benefits, investments, and finance/enterprise risk management, visit Society of Actuaries
For more information about how to become an actuary, visit Be an Actuary
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