Job Description of an Actuary
Actuaries are business professionals who deal with the financial impact of risk, usually involving an individual or business. They use their understanding of mathematics, statistics, historical data and financial systems to evaluate the likelihood of events and their inherent risk. According to the U.S. Bureau of Labor Statistics (BLS), actuaries use many sets of data to estimate the probability of events, including deaths, injuries, disabilities, sickness or loss of property. Common duties include gathering relevant figures, using computer software to analyze data, developing and testing strategies to manage the economic impact of certain events, compiling reports and providing information to clients.
Most actuaries are employed by insurance companies and may specialize in an area such as health, life, property and casualty insurance. Some also work with pensions and retirement benefits, serve as risk managers for businesses or consult on a variety of actuarial needs. They often work on teams with other financial and insurance professionals. Although most actuaries work full time in offices, consulting actuaries may travel and work longer hours to meet clients' needs.
|Education||Bachelor's degree in mathematics, finance, or economics|
|Certification||4-6 year associate certification, and 2-3 year fellowship certification|
|Job Skills||Analytical, business, computer, and customer service abilities|
|Median Salary (2018)*||$102,880|
|Job Outlook (2016-2026)*||22% increase|
Source: *U.S. Bureau of Labor Statistics
Aspiring actuaries need to have a strong understanding of mathematics and business, and they should complete an undergraduate degree in a major such as mathematics, statistics, finance, economics or business. Some schools offer specialized actuarial science programs, although these are uncommon. Coursework in economics, statistics and corporate finance is required for certification; the BLS also recommends training in calculus, accounting and computer science. Completing an internship can help students break into the actuarial field.
Most employers require students to be professionally certified by either the Society of Actuaries (SOA) or the Casualty Actuarial Society (CAS). Both organizations offer associate certification, which takes 4-6 years to complete, and fellowship certification, which takes an additional 2-3 years. To earn and maintain certification, candidates must pass several exams, attend professionalism seminars, complete online courses provided by society and fulfill continuing education requirements. Employers in this field often cover the costs incurred while pursuing certification. Some actuaries, such as those who work with pensions, must meet additional requirements to practice.
The BLS reported that successful actuaries needed the following qualities:
- Strong analytical skills and an understanding of human behavior
- Good business knowledge and problem-solving skills
- Ability to use database software, programming languages and statistical modeling software to organize and examine data
- Ability to communicate and consult with clients and colleagues
Employment and Salary Outlook
Opportunities for actuaries were projected to increase considerably in the upcoming years. The BLS reported that employment in the field was expected to grow 22% between 2016 and 2026, notably in the insurance industry. An increase in usable data in that industry, coupled with changing healthcare laws, will fuel the demand for actuaries. However, it is a relatively small profession, and competition can be high for positions. Candidates who have completed an internship and one or more actuarial exams should have the best advantage. According to the BLS, actuaries had a median salary of $102,880 in 2018.