Actuarial Science is a discipline that deals with assessing, measuring and managing financial risks in finance, insurance, and other similar segments. Uncertainties are a part and parcel of every business. However, organizations need to be well-prepared to manage and mitigate such risks as they may arise. Here the role of an actuary- a business professional who is well-versed in Actuarial Science- assumes significance. Actuarial Science is a viable and highly rewarding career option for individuals willing to translate their knowledge of risk assessment into a full-time vocation.
Role of an Actuary
An Actuary performs various roles depending on his job profile such as product pricing, financial modelling, valuations, risk management, carrying out peer reviews, designing social security schemes, advising on the premium to be charged. Hence they are required to possess an in-depth understanding of various insurance risks and using the knowledge of finance, statistics and mathematics to make informed financial decisions. A typical day for Actuary involves attending to company management issues, participating in various meetings, replying to emails, facilitating the implementation of financial and technical provisions of the company and much more.
Eligibility conditions
Aspirants must possess following credentials to be eligible for the practice
1. The individual must be at least 18 years
2. He must have passed 10+2 from a recognized educational institution
3. Whether the aspirant is a graduate or a post-graduate, proficiency in Mathematics and Statistics is a must as these Actuary uses the knowledge of these disciplines to formulate a viable Risk Management Strategy out of a pile of generic data and variables.
{{/usCountry}}3. Whether the aspirant is a graduate or a post-graduate, proficiency in Mathematics and Statistics is a must as these Actuary uses the knowledge of these disciplines to formulate a viable Risk Management Strategy out of a pile of generic data and variables.
{{/usCountry}}4. While studying actuarial science may give you conceptual clarity, enrolling in Institute of Actuaries of India(IAI) and qualifying the Actuarial Common Entrance Test (ACET) is mandatory
5. The apex body that appoints actuaries all over India is IAI (Indian Actuary Institute). IAI releases notification for ACET (Actuarial Common Entrance Test) bi-annually which aspirants need to qualify all the 15 subjects. Some of these subjects are Financial Mathematics, Business Economics, Statistical Methods, Enterprise Risk Management and much more.
6. Aspirants who clear all the four stages become eligible to become a Fellow of the Society. However, there are career opportunities even for those who manage to clear 2-3 subjects of IAI.
Skills Set
An Actuary is expected to have a keen sense of evaluation and assessment using various mathematical and statistical operations. Actuarial Science is probably the most important field after Engineering that utilizes Calculus and its functions heavily. Apart from Calculus, knowledge of the following is important to master for an individual willing to pursue Actuarial Sciences as a career option.
1. Probability
2. Numerical Assessment
3. Computer
4. Financial Skills
5. Statistical Skills
Aspirants must also have a keen eye on the business and excellent analytical and communication skills.
Career Prospects
Actuaries mostly work in Insurance and Reinsurance companies. They also work as consultants for companies, banking, financial consulting firms, Actuarial consulting firms, the government sector, pension funds, investment advisories and can pursue academics as well. Some of the top companies that hire Actuaries are PwC Actuarial Services India, Max Bupa Insurance, Milliman, IDBI and many more.
Actuaries take the responsibility of assessing risks involved in new policies, capital, and resources allocation.
An Actuary in India earns anywhere between 4 lakhs and 20 lakhs per year depending upon the level of experience and expertise. Besides, they are also entitled to various fringe benefits like medical insurance, apartment, and transportation benefits depending upon the corporation for which the individual provides his/her services.
A career as an Actuary promises you job security even during economic uncertainty as their expertise is always required for umpteen risks that corporations face. The ongoing COVID-19 crisis has given a fillip to risk management and mitigation skills and promises a secure future for Actuaries.
(Author Mr. Rohit Manglik is a CEO at EduGorilla. Views expressed here are personal.)