Actuaries

Career summary

Actuaries have different duties depending on their specialties:

• Insurance
• Finance
• Employee benefits

Insurance

Actuaries who work for insurance companies predict insurance risk by using statistics. They figure the odds of fires or other natural disasters occurring. They calculate death, accident, and unemployment rates. They also estimate the rates at which disabilities and retirements occur. Actuaries determine how much insurance should cost. They do this by comparing the cost of providing coverage with the money needed to cover expected losses. They set insurance rates accordingly.

Finance

Actuaries who work for banks or other financial companies also calculate odds. They may help decide company policy or develop new financial or insurance products. They are sometimes called on to testify at public hearings or in court on issues that affect their companies. Some price corporate stock offerings. Consulting actuaries provide advice and services to clients on a contract basis.

Employee benefits

Some actuaries design pension plans by calculating the amount of money that can be made on investments. They calculate how much people need to pay into their pension or retirement plans to offset pension payments.

Related careers

This career is part of the Finance cluster of careers.

Related careers include:

• Accountants and Auditors
• Budget Analysts
• Cost Estimators
• Financial Analysts
• Financial Examiners
• Insurance Underwriters
• Job Benefits and Analysis Specialists
• Market Research Analysts
• Mathematicians
• Operations Research Analysts
• Statistical Clerks
• Statisticians

Job duties

Task list

The following list of tasks is specific to actuaries.

• Calculate how much insurance should cost. Determine how much people should pay into their pension plans.
• Study statistics and calculate the odds of fires or other natural disasters occurring. They do the same thing for predicting unemployment.
• Advise companies on pension plans, insurance plans, and other complex technical matters.
• Calculate death and accident rates. They also estimate rates of such things as disability and retirement.
• Set insurance rates according to cost and competitors' rates.
• Determine rates for paying out profits on investments.
• Price corporate stock offerings.
• Testify before public agencies or in court on issues that affect their companies. Explain how new laws might affect their businesses.
• Provide advice to clients if working as a consultant.
• Work with programmers, underwriters, accounts, claims experts, and managers when developing new insurance or financial products.

Common work activities

Actuaries perform the following tasks. These tasks are common to many careers.

• Analyze data or information
• Process information
• Make decisions and solve problems
• Use computers
• Get information needed to do the job
• Update and use job-related knowledge
• Evaluate information against standards
• Communicate with supervisors, peers, or subordinates
• Explain the meaning of information to others
• Estimate sizes, quantities, time, cost, or materials needed
• Provide advice and consultation to others
• Identify objects, actions, and events
• Organize, plan, and prioritize work
• Think creatively
• Communicate with people outside the organization
• Establish and maintain relationships
• Document and record information
• Develop goals and strategies
• Develop and build teams
• Teach others
• Coordinate the work and activities of others
• Coach others
• Guide, direct, and motivate others
• Judge the value of objects, services, or people

Work requirements

Working conditions

In a typical work setting, actuaries:

Interpersonal relationships

• Spend half of their time working alone. However, it is very important that they work well in teams.
• Communicate with clients or coworkers daily by phone or e-mail.
• Write letters and memos weekly.
• Are somewhat responsible for the work done by others.

Physical work conditions

• Mostly work indoors. They have desk jobs and their offices are usually comfortable and pleasant.

Work performance

• Must complete all their work and do it accurately. Actuaries work with money, insurance, and other factors that have a big impact on people's lives.
• Must be aware of changes in social, economic, and other events that might affect the work they do.
• Plan most of their own tasks, priorities, and goals without talking with a supervisor.
• Make most decisions without talking with a supervisor.
• It is very important that actuaries are able to repeat the same tasks during the day.

Hours/travel

• Often work at least 40 hours per week.
• May travel to meet with clients.

Physical demands

Actuaries frequently:

• Sit for long periods of time.

It is important for actuaries to be able to:

• See details of objects that are less than a few feet away.
• Speak clearly so listeners can understand.
• Understand the speech of another person.

It is not as important, but still necessary, for actuaries to be able to:

• See details of objects that are more than a few feet away.
• See differences between colors, shades, and brightness.
• Focus on one source of sound and ignore others.

Skills and abilities

Actuaries need to:

Communicate

• Read and understand work-related materials.
• Listen to others and ask questions.
• Understand written information.
• Understand spoken information.
• Speak clearly so listeners can understand.
• Write clearly so other people can understand.

Reason and problem solve

• Judge the costs and benefits of a possible action.
• Analyze ideas and use logic to determine their strengths and weaknesses.
• Use reasoning to discover answers to problems.
• Identify what must be changed to reach goals.
• Recognize the nature of a problem.
• Combine several pieces of information and draw conclusions.
• Develop rules that group items in various ways.
• Recognize when important changes happen or are likely to happen in a system.
• Notice when something is wrong or is likely to go wrong.
• Follow guidelines to arrange objects or actions in a certain order.
• Understand new information or materials by studying and working with them.
• Concentrate and not be distracted while performing a task.
• Think of new ideas about a topic.
• Think of original, unusual, or creative ways to solve problems.

Use math and science

• Choose a mathematical method or formula to solve problems.
• Add, subtract, multiply, and divide quickly and correctly.
• Use math skills to solve problems.

Manage oneself, people, time, and things

• Check how well one is learning or doing something.
• Manage the time of self and others.

Work with people

• Use several methods to learn or teach new things.
• Change behavior in relation to others' actions.
• Solve problems by bringing others together to discuss differences.
• Persuade others to approach things differently.
• Teach others how to do something.

Work with things

• Analyze needs and requirements when designing products.

Perceive and visualize

• Identify a pattern (a figure, object, word, or sound) that is hidden in distracting material.

Education and training

Educational programs

The programs of study listed below will help you prepare for the occupation or career cluster you are exploring.

Programs of study directly related to this occupation

• Actuarial Science
• Mathematics
• Statistics

Other programs of study to consider

• Accounting
• Applied Mathematics
• Business Economics
• Economics
• Finance
• Insurance
• Marketing Research

Training

To work as an actuary, you typically need to:

• have a high school diploma or equivalent;
• have at least a bachelor's degree in actuarial science or a related field;
• complete long-term, on-the-job training; and
• pass several professional actuarial exams.

Education after high school

You need at least a bachelor's degree to work as an actuary. Many actuaries have a master's degree or higher. College majors that are best for this work are math, actuarial science, and statistics. Some actuaries major in economics, finance, or accounting. About 100 colleges and universities offer an actuarial science program. Most colleges and universities offer degrees in math or statistics.

Success in this field depends on completing the process to become credentialed by an actuarial organization. The process usually takes from five to ten years. Two organizations monitor the process. They are the Society of Actuaries and the Casualty Actuarial Society. Both groups require applicants to complete specific college courses. These courses are economics, corporate finance, and applied statistical methods. By submitting college transcripts, applicants can get credit toward their credential. You will also need to complete a series of actuarial exams. You can take the first few tests while you are still a student. These courses and tests can help you evaluate your potential for actuarial work. The Society of Actuaries gives exams on life and health insurance, pension, and finance and investment. They also require completing some computer-based courses. The Casualty Actuarial Society gives exams on fire, accident, and medical malpractice insurance. They also have exams on workers compensation and personal injury liability.

Work experience

People seeking to become actuaries usually gain work-related experience at an insurance company or consulting firm. It can take several years of study to pass the actuarial exams. Thus, actuaries often have between three and six years of experience before they pass all their exams.

On-the-job training

As a beginning actuary you rotate though different departments at a company. This way you learn the business and the role and impact of actuarial decisions. You work with experienced actuaries as you perform routine tasks such as preparing data for projects. Later, you work with less supervision and take on more tasks. For example, you may supervise clerks, draft reports, and conduct research. Training generally lasts at least one year.

Helpful high school courses

In high school, take classes that prepare you for college. A college preparatory curriculum may be different from your state's graduation requirements. Actuaries use high levels of math, so you should take calculus if possible.

You should also consider taking some advanced courses in high school. This includes Advanced Placement (AP) and International Baccalaureate (IB) courses if they are available in your school. If you do well in these courses, you may receive college credit for them. Advanced courses can also strengthen your college application.

Helpful electives to take in high school that prepare you for this career include:

• Computer Applications
• Introduction to Business
• Probability and Statistics

The courses listed above are meant to help you create your high school plan. If you have not already done so, talk to a school counselor or parent about the courses you are considering taking.

You should also check with a teacher or counselor to see if work-based learning opportunities are available in your school and community. These might include field trips, job shadowing, internships, and actual work experience. The goal of these activities is to help you connect your school experiences with real-life work.

Join some groups, try some hobbies, or volunteer with an organization that interests you. By participating in activities you can have fun, make new friends, and learn about yourself. Maybe one of them will help direct you to a future career. Here are examples of activities and groups that may be available in your high school or community.

Things to know

Most employers require at least a bachelor's degree in actuarial science or a related field. Many require a master's degree or higher. Some employers require more than five years of experience. For entry-level workers, employers prefer workers who have passed at least one of the actuarial exams.

Companies prefer well-rounded applicants who have both a technical and a liberal arts background. Knowledge or experience in computer programming will be an asset as well. Employers prefer workers with good communication and interpersonal skills.

Many insurance companies and consulting firms have summer and/or part-time jobs for actuarial students.

Tips

While in high school, take computer science courses to enhance your computer skills and attend career fairs related to this occupation. One or more actuarial internships while in college is a good way to gain work experience and is recommended.

#Internship comments from interview with actuary posted 2/16/06 at http://www.beanactuary.org/onthejob/ask/ask07.cfm  Computer sci/career fairs comment from same website 1/29/14. Internship still noted as important at this site 1/29/18, CJ.

Costs to workers

Workers who join a professional association may have to pay annual dues. Individuals may also be required to pay their own exam fees.

#Revised prof assn statement 1/27/10 cj

Licensing/certification

Pension actuaries typically must be licensed by the US Department of Labor and US Department of Treasury's Joint Board for the Enrollment of Actuaries.

Job listings

Listed below are links to job categories from the National Labor Exchange that relate to this career. Once you get a list of jobs, you can view information about individual jobs and find out how to apply. If your job search finds too many openings, or if you wish to search for jobs outside of Washington, you will need to refine your search.

• Actuaries 

To get a listing of current jobs from the WorkSource system, go to the WorkSource website .

Wages

Pay varies with experience and with the number of actuarial exams passed.

Actuaries usually receive benefits. These include vacation and sick leave. Benefits also include health and life insurance and a retirement plan.

Employment and outlook

Washington outlook

The table below provides information about the number of workers in this career in various regions. It also provides information about the expected growth rate and future job openings.

National employment

Most jobs in this occupation are located in urban areas, but opportunities vary by area of the country. States in which actuary jobs are concentrated include Illinois, New Jersey, New York, and Connecticut.

Major employers:

• Insurance companies
• Management consulting companies
• Business management companies

National outlook

Demand for actuaries is growing very strong. New health care insurance laws require actuaries to research changes in policies and the expansion of the number of people covered by insurance. This industry should continue to be a stable source of employment.

Changes in number and strength of powerful storms will provide more jobs for actuaries. Actuaries calculate the costs and risks of natural disasters to property and communities in order to help insurance companies create special policies.

Competition for jobs will be strong because this is a small occupation. The number of people who apply for openings will be greater than the number of jobs available.

Other resources

American Academy of Actuaries 
1850 M Street NW, Suite 300
Washington, DC 20036
202.223.8196

Be An Actuary.org 

Casualty Actuarial Society 
4350 North Fairfax Drive, Suite 250
Arlington, VA 22203
703.276.3100

Mathematical Association of America 
1529 - 18th Street NW
Washington, DC 20036
800.741.9415
202.387.5200

Mathematical Sciences Career Information 

Society of Actuaries 

References

Career cluster

• Finance

Career path

• Conventional (Business Operations)

O*Net  occupation

• Actuaries (15-2011.00) 

O*Net job zone 

• Job Zone 4 - Considerable preparation needed. A minimum of two to four years of work-related skill, knowledge, or experience is needed for these occupations.

DOT occupation

• Actuary (020.167-010) 

Strong Interest Inventory

• Actuary

Holland occupational cluster

• Conventional/Investigative/Enterprising

COPSystem

• Science Professional