Actuary Job Description - An Overview
Do you want to know the actuary job description to see if it fits with your career plans? Here’s some background information first: more than half of all actuaries work in the insurance sector. These professionals have excellent skills in business, probability and statistics, among others.
Here's the focus of the spotlight on some key actuary job descriptions:
Evaluate risk and reduce its impact: Actuaries assess risks from events that span injuries to natural disasters, sickness to disability. What is an output of such an evaluation? It helps the actuaries fix the price for a risk. They also establish financial cushions for the “soft landing" of the effects of the events. Through such work, actuaries help their companies hold a tight rein on the potential losses. Why can a company incur losses? Because it must honor, for example, insurance claims, even if a claim payment is far higher than the premium receipts.
Allocate funds for claims: A company should reserve funds to meet its promises to its clients. How much money should the organization have with it always? Actuaries estimate this amount through the use of mathematical tools and techniques.
Establish report metrics: Actuaries design and implement the standards and methods for financial reports for the senior managers of the company.
Find the best investment options: An insurance company, for example, typically has billions of dollars with it at any point of time. It has so much of cash because high numbers of insurance holders pay premiums to the company on a regular basis. After it allocates funds for the claims and other costs, the insurer has still surplus money.
Such funds, however, cannot lay idle, as the company must improve its bottom line. Here’s where the actuaries pitch in again and advise where the enterprise should sow its money. In essence, actuaries create the blueprint for investments that give the best returns.
Design insurance and pension products: Actuaries design such products to create a win-win situation for the consumer and the insurer. Let’s consider an example: An actuary who works in a health insurance company uses data and complex mathematical models to fix the premium for people with certain demographic and health profiles.
The actuaries decide the premiums with such techniques as the probability calculation of the number of claims, say from certain diseases. This work guarantees the organization has adequate funds to pay for the claims. At the same time, actuaries make sure the premium and the benefits have an edge in the health insurance market.
Forecast the potential and risk for a new business: Say a company that caters its products to customers in the U.S. now wants to test the waters in the Japanese market. Actuaries forecast the demand and risk in that country for what the organization wants to offer. These professionals might also develop the business roadmap for success in the new market.
Does the core actuary job description pique your interest? Learn about the educational and licensure needs to ride on the actuary career bandwagon.