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Role of acturies in insurance


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Role of an Actuary.

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Role of acturies in insurance

  1. 2. WHO IS AN ACTUARY ? <ul><li>Actuaries are experts who perform actuarial analysis of insurance rates, rating procedures, rating plans, and schedules of insurance companies. These are professionals who are experienced in reviewing and analysing insurance operations, reserves and underwriting procedures and provide technical assistance regarding actuarial matters to policy examiners and other technical staff. </li></ul>
  2. 3. THEIR MAIN ACTIVITIES <ul><li>Product pricing </li></ul><ul><li>Product Design </li></ul><ul><li>Financial management </li></ul><ul><li>Corporate planning </li></ul>
  3. 4. WHERE DO ACTUARIES WORK? <ul><li>Actuaries work for </li></ul><ul><li>Life insurance </li></ul><ul><li>Pension funds </li></ul><ul><li>General insurance </li></ul><ul><li>Health insurance </li></ul><ul><li>Investments </li></ul><ul><li>Government </li></ul><ul><li>Academics </li></ul>
  4. 5. ROLE OF ACTUARIES IN INSURANCE <ul><li>Evaluating the likelihood of future events </li></ul><ul><li>Designing creative ways to reduce the likelihood of undesirable events </li></ul><ul><li>Decreasing the impact of undesirable events that do occur. </li></ul><ul><li>undesirable events can be both: </li></ul><ul><li>emotional </li></ul><ul><li>financial. </li></ul>
  5. 6. <ul><li>Gathering analytical skills, business knowledge and understanding of human behavior to design and manage programs that control risk. </li></ul><ul><li>RISK = UNCERTINITY </li></ul><ul><li>Actuaries engage in risk management programs. </li></ul>WHAT HAPPENS IF RISK MANAGEMENT PROGRAMS DEVELOPED BY ACTUARIES DIDN’T EXIST ?
  6. 7. ANSWERS THE FOLLOWING QUESTIONS <ul><li>Would as many people be willing to own a home if fire insurance did not exist? </li></ul><ul><li>Would a company build a factory that could be destroyed in an earthquake if it were not protected by insurance? </li></ul><ul><li>Would people spend money today and still be confident about their future if there were no retirement programs or social security? </li></ul>
  7. 8. <ul><li>Would parents enjoy risky and adventurous recreational activities such as rock climbing or skiing if their children faced financial disaster in the event of an accident? </li></ul><ul><li>Would the banks (and the money deposited in them) be safe if their assets and liabilities were not carefully managed to control financial risk? </li></ul><ul><li>SO WE NEED ACTUARIES IN ANY WAY </li></ul>
  8. 9. TECHNIQUES TO CONTROL RISK <ul><li>Offsetting one risk with another </li></ul><ul><li>Risk is a matter of perspective </li></ul><ul><li>Focus on catastrophic risks </li></ul>
  9. 10. INDIAN ACTUARIES – ROAD AHEAD <ul><li>IRDA (The Insurance Regulatory and Development Authority of India) has stated </li></ul><ul><li>“ We have reached a situation where the role of appointed actuaries has to be enhanced significantly so that general insurers are in a position to cope with public demand for non-life products and at the same time ensure the availability of solvency on a continuous basis.” </li></ul>
  10. 11. <ul><li>list of typical actuarial projects: </li></ul><ul><li>Analyzing insurance rates, such as for cars, homes or life insurance. </li></ul><ul><li>Estimating the money to be set-aside for claims that have not yet been paid. </li></ul><ul><li>Participating in corporate planning, such as mergers and acquisitions. </li></ul><ul><li>Calculating a fair price for a new insurance product. </li></ul><ul><li>Forecasting the potential impact of catastrophes. </li></ul><ul><li>Analyzing investment programs. </li></ul>
  11. 12. CARRIER OPPURTUNITIES IN INSURANCE SECTOR <ul><li>In India, the profession of actuary is managed and regulated by the Actuarial Society of India in located in Mumbai which conducts these professional examinations and currently, more than 1200 members are pursuing this education. </li></ul>
  12. 13. <ul><li>JOB OPPORTUNITIES: </li></ul><ul><li>Within India </li></ul><ul><li>Actuaries and actuarial students are generally employed in; </li></ul><ul><li>1) Life Insurance Corporation of India (LIC). </li></ul><ul><li>2) General Insurance Corporation of India (GIC). </li></ul><ul><li>3) Public Sector General Insurance Companies. </li></ul><ul><li>4) Private Sector Life Insurance Companies. </li></ul><ul><li>5) Private Sector General Insurance Companies. </li></ul><ul><li>6) Firms of Consulting Actuaries. </li></ul><ul><li>7) Insurance Regulatory and Development Authority (IRDA). </li></ul><ul><li>8) Tariff Advisory Committee (TAC) </li></ul><ul><li>9) Software development companies </li></ul><ul><li>10) “Back-end” and “virtual” offices in India for employers overseas. </li></ul><ul><li>In addition to the above, employment opportunities are expected </li></ul><ul><li>to arise in future in offices of the; </li></ul><ul><li>11) Insurance Intermediaries </li></ul><ul><li>12) Pension providers other than Insurance companies </li></ul><ul><li>13) Education </li></ul><ul><li>14) Re-insurance </li></ul><ul><li>15) Social Securities Schemes </li></ul><ul><li>16) Financial Analysts </li></ul><ul><li>17) Construction Industry / Engineering Projects </li></ul>
  13. 14. <ul><li>THANK YOU </li></ul>