How Do I Become an Actuary?

Research what it takes to become an actuary. Learn about job duties, education requirements and certification requirements to find out if this is the career for you. Schools offering Risk Management degrees can also be found in these popular choices.

What Is an Actuary?

Actuaries typically assess risk for insurance companies. These risk assessments are used to determine the price of insurance premiums. Actuaries also collect data and develop reports for their calculations. As an actuary, you may be responsible for helping to develop insurance policies and premiums that are profitable for your company. Read over the chart below for a summary of this career field.

Degree Required Bachelor's degree
Education Field of Study Actuarial science, mathematics, statistics, business
Key ResponsibilitiesCalculate the probability of various events occurring, develop reports that clarify calculations, determine insurance prices based on calculations
Certification Required Certification is required
Job Growth (2014-2024)18%*
Median Salary (2015) $97,070*

Source: *U.S. Bureau of Labor Statistics

What Does an Actuary Do?

Actuaries calculate the probability of the occurrence of various events, such as natural disasters, injuries, illnesses, accidents and deaths. These types of calculations are especially important to insurance companies, which provide insurance coverage for these occurrences. As an actuary working in the insurance industry, you'll calculate the risk of occurrence of adverse events and use these calculations to predict the number of claims your company is likely to incur. You'll determine the price of insurance premiums based on the forecasted number of claims. You'll also help your company determine the amount of funds that needs to be set aside for future claim payments.

If you work in the financial sector, you'll assist your company in managing financial risk. You might also be responsible for providing investment advice and managing credit. Regardless of the industry you work in, your job as an actuary might require you to serve as an educator and make sure executives, managers, staff, policyholders and the public understand the sometimes complicated technical reasons behind decisions that are made.

What Are My Educational Requirements?

To work as an actuary, you'll need to hold a bachelor's degree and pass a series of actuarial exams. You could consider majoring in a business field, such as finance or economics, or a mathematical field, such as statistics or actuarial science. While in school, you could pursue an internship that will allow you to gain hands-on experience working at an insurance company, investment firm or other organization that hires actuaries. An increasing number of employers require job applicants to have a grade point average (GPA) of at least 3.2 and to have passed the first actuarial exam, which assesses the candidate's mathematical skills.

What Must I Do To Receive Certification?

It can take numerous years after graduating from college, and even after finding a job, to reach full professional status as an actuary. This is because, according to the U.S. Bureau of Labor Statistics (BLS), you'll need to pass seven to nine actuarial exams in order to gain full professional status. These exams are administered by the Society of Actuaries (SOA) and the Casualty Actuarial Society (CAS), both of which provide professional certification to actuaries.

The society you'd seek certification from depends on your field of interest. If you'd like to work in the fields of health benefits and pension systems, life insurance or finance, you'd seek certification from the SOA. If you're interested in working in the field of property and casualty insurance, including automobile, fire and personal injury liability insurance, you'd seek certification from the CAS. The first four actuarial exams in the series are the same whether they're administered by the SOA or the CAS so you'll have some time to choose your field of specialization. For both the SOA and the CAS, there are two levels of certification, the Associate and the Fellowship levels.

Regardless of which society you seek certification from, it'll take approximately 4-8 years to reach the Associate level of certification. To reach the Associate level in the CAS, you'll need to complete seven exams and a professionalism course. To gain the Associate level of certification in the SOA, along with the completion of five exams, you'll need to complete eight computer modules, two essays and a professionalism seminar. In addition, the SOA requires you to choose a specialty out of retirement benefits, investments, individual life and annuities, health benefits or financial risk management.

It takes an additional 2-3 years to reach the Fellowship level of certification in both the CAS and SOA. To attain Fellowship status in the CAS, you'll need to pass two more exams on advanced topics such as valuation of insurance and financial analysis. In the SOA, you'll need to take two more exams based on your chosen specialty and complete three more computer modules, another professionalism seminar and a fellowship admissions course.

What Are Some Related Alternative Careers?

Two similar careers that also typically require a bachelor's degree are those of financial analysts and insurance underwriters. Financial analysts help individuals and businesses make investment decisions by evaluating data and trends that affect investments. Insurance underwriters evaluate insurance applications to determine whether or not to offer insurance to a client, and how much coverage a client should get.

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