Document

Report
You Can Be an Actuary!
Presented By
Jarrett Cabell, FCAS
Kezia Charles, ASA, EA
Overview
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Introduction
What does the future hold for you? (Prospects / Risks)
What is an actuary?
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What do actuaries do?
Where do actuaries work?
What skills are needed to become an actuary?
How do I become an actuary?
What is the current and future career outlook for
actuaries?
Conclusion (Advice, Helpful Links, Q&A)
Overview
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Introduction
What does the future hold for you? (Prospects / Risks)
What is an actuary?
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What do actuaries do?
Where do actuaries work?
What skills are needed to become an actuary?
How do I become an actuary?
What is the current and future career outlook for
actuaries?
Conclusion (Advice, Helpful Links, Q&A)
Introduction

Jarrett Cabell, FCAS
– Henderson County High School (KY)
– Washington University in St. Louis (Mathematics, ’06)
– Allstate (since July ‘09); Zurich North America (3 years)
– Work in Property & Casualty sector (“P&C”)
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Kezia Charles, ASA, EA
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St Joseph’s Convent (POS, Trinidad)
MIT (Mathematics, ’04)
Watson Wyatt/Towers Watson (2004 – Present)
Work in Pension Consulting
Overview
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Introduction
What does the future hold? (Prospects / Risks)
What is an actuary?
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What do actuaries do?
Where do actuaries work?
What skills are needed to become an actuary?
How do I become an actuary?
What is the current and future career outlook for
actuaries?
Conclusion (Advice, Helpful Links, Q&A)
What Does the Future Hold?

Prospects (“Desirables”)
 Health
& Wellness
 Successful Careers
 Homes & Neighborhoods
 Vacation
 Retirement in Jamaica
What Can Thwart Your Future?
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Risks (“Undesirables”)
 Illness
(injuries, disability)
 Insecurity (job layoffs, financial burdens)
 Accidents
– Man-made (home, auto, work place)
– Acts of nature (earthquake, hurricane,
tornado)
 Crime (theft, arson, murder, terrorism)
 Death
Overview
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Introduction
What does the future hold for you? (Prospects / Risks)
What is an actuary?
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What do actuaries do?
Where do actuaries work?
What skills are needed to become an actuary?
How do I become an actuary?
What is the current and future career outlook for
actuaries?
Conclusion (Advice, Helpful Links, Q&A)
What is an actuary?
An actuary:
 Analyzes, manages, and measures the financial
implications of future risk
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Develops financial models to guide decision making
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Serves as the analytical backbone of our society’s
financial security programs (i.e., insurance, Social
Security, pensions)
What do actuaries do?
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Evaluate likelihood of future events
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Design creative ways to reduce the likelihood of undesirable
events
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Forecast potential impact of catastrophes
Calculate expected lifetime of retiree receiving pension benefits
Life insurance policy, annuity
Promote safety (e.g., seat belts)
Decrease the impact of undesirable events that do occur
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Death benefits
Retirement benefits
Indemnity benefits
What do actuaries do?
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Participate in corporate planning
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Mergers & Acquisitions
Evaluate investment programs
Help insurance companies:
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Calculate rates for new insurance products
Forecast and interpret underwriting results
Maintain databases uniquely suited for the analysis of pricing
issues
Where do actuaries work?
Actuaries are largely employed by insurance companies and
consulting firms, specializing in the following areas:
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Life, Annuities, and Mutual Funds
Health
Pensions
Property & Casualty
Life, Annuities, and Mutual Funds
1) Life Insurance
Offers several term and permanent insurance products
to provide death benefit protection to its customers.
2) Annuities
Fixed and variable annuity products allow customers to make a
lump-sum payment or series of payments today in return for
periodic payments beginning immediately or in the future.
3) Mutual Funds
A mutual fund pools the assets of multiple investors and
purchases securities to achieve a common, pre-defined goal.
With its pooled assets, mutual funds provide advantages that
an individual investor would not be able to receive.
Source: http://www.thehartford.com
Health
1) Individual
Offers Medicare and other health products to individuals,
families, and sole proprietors.
2) Employers
Offers administration services, Health Benefit and Health
Insurance Plans incorporating managed medical, pharmacy
and dental care services and other valuable resources and
products based on employer size. An example:
 Small Group – 2 to 50 employees
 Middle Market – 51 to 3000 employees
 National Accounts – 3001+ employees
Source: http://www.aetna.com
Pensions
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Provide steady income, typically in the form of a guaranteed
annuity, to a retired or disabled employee under predetermined legal and/or contractual terms.
Plans can be divided into two broad types:
1) Defined benefit plans - incorporate the employee's pay,
years of employment, age at retirement, and other factors
in calculating the benefit.
2) Defined contribution plans - such as a 401(k) plan or
403(b) plan, in which the employee elects to defer some
amount of his/her salary into the plan and bears the
investment risk.
Source: http://wikipedia.org
Property & Casualty
1) Business Insurance
Offers a broad array of property and casualty insurance and
insurance-related services to its clients, which range from small
“Main Street” businesses to Fortune 100 corporations.
2) Personal Insurance
Offers a broad array of property casualty insurance products to
individual customers such as Auto, Homeowners, etc…
3) Financial, Professional & International Insurance
Includes surety and financial liability coverages, as well as
property and casualty products that are primarily marketed on
an international basis.
Source: http://www.travelers.com
What Skills are Needed to
Become an Actuary?
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Keen analytical, project management, and problem-solving skills
Good business acumen
Excellent communication skills (oral and written)
Solid computer skills (Microsoft Office)
Strong work ethic (especially for the exam process!)
Motivation
Creativity
Independence
Ability to collaborate effectively with others
Overview
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Introduction
What does the future hold for you? (Prospects / Risks)
What is an actuary?
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–
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What do actuaries do?
Where do actuaries work?
What skills are needed to become an actuary?
How do I become an actuary?
What is the current and future career outlook for
actuaries?
Conclusion (Advice, Helpful Links, Q&A)
How do I become an actuary?
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Professional designation is achieved by passing a series of
examinations
Actuarial examinations are administered by the Casualty
Actuarial Society (CAS) and the Society of Actuaries (SOA)
Examinations are held multiple times a year
Two levels of membership in each organization:
– Associate (ACAS or ASA)
– Fellow (FCAS or FSA)
You work AND take exams!
Actuarial Student Programs
To prepare you for success in completing the
series of professional exams, most companies
offer the following benefits:

100 to 140 paid study hours per exam sitting
Reimbursement for exam registration fees, study materials, and a
preparatory exam seminar
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Time off on exam days and the day prior to each exam
Receive rewards for each exam you pass!
What do the exams cover?
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Preliminary Exams
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Joint exams (for which both societies give credit)
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P/1: Probability
FM/2: Financial Mathematics
MFE/3F: Financial Economics
C/4: Actuarial Models
SOA’s MLC (Life Contingencies) vs.
CAS’s 3L (Life Contingencies & Statistics)
How to Prepare for Exams
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Set up a study schedule
Go through the syllabus
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The syllabus for each exam is on the SOA/CAS
website
Be sure that you have covered all the material
before the exam
Get a study manual (e.g. ASM, Actex)
Exam Seminars
How to Prepare for Exams
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Take practice exams
Study groups
Know your study style
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Do you study better in mornings or evenings?
Can you study for long blocks of time or would
shorter blocks on more days work better?
What do the exams cover?
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Upper-Level Exams: Vary by discipline:
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SOA: Retirement Benefits; Group & Health Design
& Pricing; Individual Life & Annuities; Investments
CAS: Introduction to P&C Insurance/Pricing;
Reserving; Accounting/Annual Statement;
Advanced Financial Management; Advanced
Pricing
Exam Statistics
See next page
Exam Statistics
Overview
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Introduction
What does the future hold for you? (Prospects / Risks)
What is an actuary?
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What do actuaries do?
Where do actuaries work?
What skills are needed to become an actuary?
How do I become an actuary?
What is the current and future career outlook for
actuaries?
Conclusion (Advice, Helpful Links, Q&A)
Salary Information
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Starting salaries of
$46,000-$65,000
(passed one exam, 0 - 0.5 years
experience)
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Merit-based increases (contingent upon
workplace performance)
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Exam passing increases
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Increases upon achievement of
professional designations
Source: D.W. Simpson & Company Website:
http://www.dwsimpson.com/salary.html
Salary Survey
Preface to the forthcoming salary survey slides:
 These figures serve as a general range and average of various
compensation levels

These figures are base salaries only and do not figure in
bonuses or annual incentives

Last Updated: October 2009
–
http://www.dwsimpson.com/salary.html
Life / Health Actuary
0-0.5 yrs
0.5-
2.5-
4.5-
6.5-
9.5-
14.5-
19.5+
2.5 yrs
4.5 yrs
6.5 yrs
9.5 yrs
14.5 yrs*
19.5 yrs*
yrs*
51-66
55-72
98-146
109-234
115-252+
127-220
144-324
149-341+
1 course
(excl. signon)
46-62
2 courses
49-67
55-72
60-77
64-82
52-69
57-76
63-83
67-88
54-71
61-83
67-89
72-96
75-103
65-88
72-96
80-108
84-118
73-98
78-108
88-119
93-132
3 courses
(MLC+MFE=1)
4 courses
5 courses
(or 4 + FAP I)
ASA
7 courses
95-137
8 courses
105-147
FSA
95-148
101-158
110-174
Life/Health/Pension combined-CEO/CFO/CIO/COO/Pres.-10th-90th%
TBD data points - from 2009 SEC Def 14A filings
N/A
Pension Actuary
0-0.5 yrs
0.5-
2.5-
4.5-
6.5-
9.5-
14.5-
19.5+
(excl. signon)
2.5 yrs
4.5 yrs
6.5 yrs
9.5 yrs
14.5 yrs*
19.5 yrs*
yrs*
1 course
47-62
51-64
55-70
2 courses
51-64
53-66
60-76
63-81
53-70
58-72
63-85
66-91
72-95
55-73
61-79
68-90
73-100
78-106
67-88
71-94
76-104
80-112
68-91
74-99
81-111
85-117
103-155
123-237
140-258+
133-205
147-321
150-344+
3 courses
(MLC+MFE=1)
4 courses
5 courses
(or 4 + FAP I)
ASA
7 courses
89-129
8 courses
103-144
FSA
97-134
108-163
Life/Health/Pension combined-CEO/CFO/CIO/COO/Pres.-10th-90th%
TBD data points - from 2009 SEC Def 14A filings
N/A
Property & Casualty Actuary
0-0.5 yrs
0.5-
2.5-
4.5-
6.5-
9.5-
14.5-
19.5+
(excl. signon)
2.5 yrs
4.5 yrs
6.5 yrs
9.5 yrs
14.5 yrs*
19.5 yrs*
yrs*
1 exam
48-65
51-66
55-72
2 exams
51-68
55-72
60-77
65-82
3 exams
53-70
57-77
66-84
69-89
73-100
4 exams
57-74
62-84
69-92
75-99
75-109
93-138
5 exams
65-89
73-104
80-112
83-126
97-149
6 exams
71-94
80-113
87-124
97-140
110-170
ACAS
81-110
84-124
92-137
105-160
119-185
135-266
152-305+
91-133
104-155
111-174
134-224
120-184
134-215
154-329
171-439
179-478+
8 exams
FCAS
CEO/CFO/COO/CIO/CRO/President - 10th-90th percentile
TBD data points - from 2009 SEC Def 14A filings
N/A
Career Outlook for Actuaries
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Expected growth of 21% from 2008-2018
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Specific Areas of Growth
– Management Consulting; Financial Management: > 21%
– Insurance Industry: < 21%
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Other Areas of Growth
– Enterprise Risk Management
– Health Services
Source: www.bls.gov
Overview



Introduction
What does the future hold for you? (Prospects / Risks)
What is an actuary?
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–
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

What do actuaries do?
What skills are needed to become an actuary?
How do I become an actuary?
What is the current and future career outlook for
actuaries?
Conclusion (Advice, Helpful Links, Q&A)
Advice to High School Students
Who Want to be Actuaries
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Follow a college preparatory curriculum
Take math classes every year
Take advantage of advanced courses, such as
calculus
Enroll in computer science courses to develop your
computer skills
Explore colleges and universities that offer Actuarial
Science curriculum
Participate in math-based competitions such as
Mathletes
Advice to College Students
Who Want to be Actuaries
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Develop disciplined study habits
Take a well-rounded curriculum
There are people in the actuarial profession who majored in
Music, Biology, etc., who were able to attain their designations.
However, the majors that would better prepare you for this
profession are:
- Actuarial Science
- Mathematics
- Economics
- Statistics
- Finance
Enhance your general business knowledge
Sharpen your communication and presentation skills
Take actuarial exams while you are in school – the sooner you
start, the sooner you will finish!!!
Which Skills Can I Sharpen
while in college . . . and How?
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Interpersonal Skills
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Writing Skills
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Speeches (e.g., Toastmasters)
Involvement in college (or local) actuarial organizations
(e.g., IABA!)
Don’t immediately shy away from writing-intensive
electives—they could help you in the long run!
Technical Skills
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Microsoft Office (Excel, Word, Access, PowerPoint), VBA,
SQL, SAS, C++
Which Skills Can I Sharpen
while in college . . . and How?
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Current Events
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Wall Street Journal, New York Times, Insurance Journal,
etc. should be helpful here
Additional Resources
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Career Counselor, Academic Advisor, Math Professor
People you meet here at the Annual Meeting
IABA Mentors and Mentor Resources
Recruiters
Top 10 Reasons to Consider
Being an Actuary
10.
9.
8.
7.
6.
5.
4.
3.
2.
1.
You enjoy continually learning.
You want a professional title, but don’t want to be a doctor,
lawyer, or accountant.
You want a career that is dynamic and challenging.
You want a career that you can control because advancement
early in one’s career is largely exam-based.
You want a career with many opportunities that will provide
you with skills that are transferable across multiple industries.
You want a career with superior job security through economic
cycles.
You would like to “earn while you learn.”
You want to be able to choose among several job offers.
You are self-motivated, goal oriented, and have superior
math aptitude and communication skills.
You want a highly competitive salary and excellent benefits.
Helpful Links

To learn more, visit
– www.blackactuaries.org
– www.beanactuary.org
– www.casact.org
– www.soa.org
Questions?
???
A Brief History of the IABA

Founded in 1992 as the National Association of Black Actuaries
(NABA), the International Association of Black Actuaries (IABA)
was created in recognition that blacks represented less than
1% of the actuarial profession in areas where the population of
blacks is greater than 15%

NABA was changed to IABA recognizing that two of its charter
members, Daisy McFarlane-Coke and W. St. Elmo Whyte, are
both from Jamaica
A Brief History of the IABA
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The issue of representation is critical because of its root
causes:
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1) lack of awareness among black children about the profession,
2) lack of support through the exam process,
3) lack of advocacy during career development, and
4) lack of role models for self visualization
IABA exists to address this issue and its root causes.
A Brief History of the IABA
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IABA seeks to address the issue of representation through:
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1. High School Awareness Programs,
2. Collegiate Scholarships and Professional Development
Workshops,
3. Mentoring Programs
4. Professional Continuing Education Workshops (including the
Annual Meeting),
5. Professional Networking and Relationship Building,
6. Exam Success Recognition, and
7. Exam Study, Resource, and Emotional Support

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