The work

Actuaries use their excellent knowledge of economics, statistics and the maths of finance to solve important business problems. In their day-to-day work they also use their knowledge of business law and practices, marketing and accounting.

Their job is to advise their employers about the possible financial results of potential projects or products that involve a degree of risk. This means:

• analysing the past, eg accident rates for particular groups of people, cars, aeroplanes etc
• modelling the future, eg to predict the effects of different life expectancies on the investments required for funding pensions
• assessing the risks involved, eg the chances that an earthquake will occur in a particular area and cause £x millions worth of damage
• explaining what the results mean in financial terms to senior managers and directors.

Actuaries are likely to be mainly concerned with life assurance, pensions and other forms of insurance, but they may assess risks associated with areas such as aviation, marine and motor insurance, and major building projects.

Their analysis plays a vital role in an organisations decisions about the business - eg what rates to apply for insurance policies to be profitable but still competitive. Actuaries who work for insurance companies calculate the funds needed to cover its long-term liabilities. Many senior managers in insurance companies are qualified actuaries.

Actuaries may work for one of the many consultancy companies that organisations go to for advice on various financial activities that have a degree of risk, especially occupational pension schemes.

Actuaries working for the Government Actuarys Department advise other departments on matters such as social insurance, state pensions and public sector pensions.

They make great use of computers to analyse and build statistical and mathematical models to predict the financial outcomes of different scenarios.

Actuaries co-operate or negotiate with a variety of people - accountants, solicitors, company secretaries, underwriters, investment managers and so on.

Hours and Environment

Actuaries work normal office hours. They may be able to work part-time.

Consulting actuaries working hours have to suit their clients but they are able to decide when they do preparatory and follow-up work.

Skills and Interests

Actuaries need:

• a high level of skills in maths and statistics, together with an aptitude for analysing data
• very good communication skills, with the ability to explain complex information (sometimes to non-specialists) in a clear and concise way, both orally and in writing
• to be able to solve problems logically
• to be able to concentrate and pay attention to detail
• information and communications technology skills
• organisational skills for gathering and ordering facts
• good commercial sense
• to be willing to develop their knowledge and skills
• a knowledge of business law, economics and commercial practices, and financial analysis skills, to give quality advice
• a sense of responsibility, integrity and sound judgement

Entry

To qualify, it is essential to become a Fellow of the Institute of Actuaries or the Faculty of Actuaries. To become a Fellow it is necessary to have at least three years relevant work experience and have passed all of the 15 professional exams (a university degree grants exemption from up to nine of these exams).

• Although there is no set upper age limit, the Faculty and Institute of Actuaries prefer candidates to begin training within four years of getting their A levels/H grades or degree. Exceptions may be considered, depending on previous experience and proven aptitude. Although the oldest person to become a Fellow was 56, the average is 28!
• The minimum requirements to become a student member of the Faculty and Institute of Actuaries are three Olevels (A-C)/S grades (1-3), including English, and two A levels/three H grades. One of the A levels should be maths at grade B, or further maths at grade C, and the other must be at least grade C. For H grades, they should include maths at grade A and English.
• Most entrants, however, are graduates working in relevant jobs. Most take a degree in a mathematical subject, some in actuarial science. The minimum qualifications for a degree course are five Olevels(A-C)/S grades (1-3) and two A levels grades, or equivalent qualifications. For a degree in a mathematical science applicants need an A level grade in a maths subject. The going rate for entrance can be a lot higher details can be checked with individual universities and colleges.
• A third class honours degree is acceptable if maths is a main component of the degree course. A first or second-class degree in any subject is acceptable, as long as applicants have A level/H grade maths.
• Degree in maths or statistics may grant part-exemption from the professional exams. With a degree or postgraduate qualification in actuarial science candidates may be exempt from a significant number of the professional exams.

Training

To qualify as Fellows of the Faculty or Institute of Actuaries, you must pass 15 professional examinations:

Core Technical Stage: nine core subjects including financial mathematics, probability, statistics and economics

Core Applications Stage: three papers including modelling data and communications, to test the practical application of the core technical subjects

Specialist Technical Stage: two papers from a list of seven technical subjects including life insurance, pensions, and finance and investment

Specialist Applications Stage: one paper from a list of seven technical subjects.

You will achieve Associate membership after gaining one year’s relevant work experience and passing the Core Technical and Core Applications stages. You will be awarded full Fellowship after at least three years’ work experience, passing the Specialist stage exams and submitting a work-based assessment.

If you have a degree or postgraduate qualification in actuarial science, statistics or economics, you may be exempt from some or all of the exams at the Core Technical Stage and some at the next stage. Please contact the Institute of Actuaries for further details of exemptions.

You will usually study for the professional exams by distance learning with the Actuarial Education Company.

Once qualified, you must undertake continuing professional development (CPD) to keep your knowledge up to date.

Opportunities

50% of actuaries work in insurance or life assurance companies. A growing number work for independent consultancies which provide a service for companies which do not employ their own actuaries.

There are also opportunities in investment banking, the Stock Exchange, industry and commerce, education, insurance, pension broking and the Government Actuary's Department.

The Institute of Actuaries and the Faculty of Actuaries have a total membership of nearly 6,000 Fellows and over 5,000 student members. The number of Fellows has grown steadily over the past 30 years, showing that there is an increasing demand for the profession.

After qualifying it is possible to become a self-employed consultant or work overseas.

Annual Income

Further information

Institute of Actuaries http://www.actuaries.org.uk

The Actuarial Education Company http://www.acted.co.uk

Financial Services Skills Council http://www.fssc.org.uk

Faculty of Actuaries http://www.actuaries.org.uk