About the actuary.

Insurance

Traditional employment for actuaries includes the ratemaking aspect of insurance — statistically determining the likelihood (frequency) and size (severity) of losses, and setting rates that earn enough to pay future claims and a profit.

Actuaries are entrusted with calculating the reserves an insurance company should set aside to meet its policyholder obligations, balancing those obligations against the company's desired level of profitability.

In most countries, an independent regulator oversees the insurance industry, and actuaries working for the regulator review proposed rates, solvency and reserves to protect policyholders' interests.

General insurance companies offer contracts such as marine, fire and miscellaneous insurance, with actuarial expertise used across product design and pricing, financial reporting and corporate planning.

Healthcare

Actuaries play an important role in designing health insurance products. In developing markets, where few people currently have health insurance, the potential target market is vast, and the provision, administration and funding of healthcare is relatively complex.

Retirement benefit schemes

Employers provide benefits such as pensions, gratuity, stock options, long-term incentives and compensated absences. These benefits depend on uncertain events like mortality, attrition rates, salary increases and asset yields. Actuaries make predictions about retirement and job-leaving patterns, salary increases, investment earnings and inflation to determine the value of benefits an employer should provide in its books of account.

Actuaries also advise on funding levels, asset-liability management, member communication and statutory compliance for retirement benefit funds.

Reinsurance

Reinsurance is insurance for an insurance company. Actuaries in reinsurance perform similar ratemaking and reserving functions to primary insurance actuaries, but wider in scope and coverage — including an important role in the acceptance of large and unusual risks.

Risk management

Many actuaries work in a risk management role, gauging an organisation's risks and working to limit downside while maximising the potential for profit. The main concern of a risk management actuary is the solvency of their company; the role extends into product design, investments and asset-liability modelling.