What Is an Actuarial Analyst?

Actuarial analysts work with companies to determine profitability, manage risk and analyze demographics. Keep reading to learn more about the job description and education requirements of actuarial analysts. Schools offering Risk Management degrees can also be found in these popular choices.

Actuarial Analyst Job Description

Actuarial analysts are professionals who work in the field of predicting risks for companies or individual clients. While the job demands many of the same skills and knowledge as an actuary position, this particular title applies to entry-level positions that require up to a few years of experience. To become gain the professional title of actuary, an actuarial analyst must become certified. When working with a team, an actuarial analyst's main duty is to analyze the gathered data.

Important Facts About This Occupation

Required Education Bachelor's degree
Key Skills Math, communication, computer, analytical, interpersonal, and problem-solving skills
Similar Occupations Accountant, auditor, budget analyst, economist
Work Environment Office setting; some travel may be required

Determining Profitability

Companies employ actuarial analysts to help assess risk and value associated with products, services and investments. At an insurance company, you'd determine premium amounts that allow the company to remain profitable. Working with a certified actuary, you'd analyze certain segments of the population to determine the likelihood of general hazards. For instance, if a life insurance company plans on making a policy for people who work in a high-risk occupation, you'd use mathematical models to determine a profitable premium and standard insurance amount for the policy.

Managing Risk

An actuarial analyst determines the possible financial consequences of potential catastrophic events. Having an idea of assets and liabilities of a potential investment allows a company to make better long-term preparations. For example, if you're working for a financial services company as an actuarial analyst, you could advise management with regard to the risk the company could take by increasing investment in a specific kind of security. You'd use mathematics and statistics to prove the validity of your recommendations.

Analyzing Demographics

You'd also base your calculations on the cumulative actions, behaviors and speculation regarding large groups of people. Working for a car-insurance carrier, you'd determine premium rates based on policy-holders' location, age and driving record. You'd likely recommend increased car insurance premiums for people who get a lot of speeding tickets, since many drivers in this pool have a higher probability of getting into accidents and filing claims. For those living in an area with low crime, you might recommend a lower premium, since the risk of someone breaking into a car is lower than for people who live in high-crime areas.

Education

Becoming an actuarial analyst requires you to have an extensive math and statistics background. The Casualty Actuarial Society (CAS) along with the Society of Actuaries (SOA) recommend that you take a wide range of business and math classes during your undergraduate years (www.beanactuary.org). You'll want to complete classes in finance, microeconomics and macroeconomics, in addition to calculus and algebra. To become an actuarial analyst, you can earn a degree in business, math or actuarial science, but other majors, such as economics, could also apply to the career.

Certification

To become a full-fledged actuary, you'll need to be certified by one of the societies mentioned above. Your first step involves passing a series of exams to become an associate of the SOA or CAS, which could take 6-10 years. You'll be tested with regard to your understanding of many subjects, such as probability, financial mathematics and life contingencies. You'll then need to earn fellowship status by passing another series of exams that test you in your chosen specialization.

Employment Outlook and Salary Information

According to the U.S. Bureau of Labor Statistics (BLS), job opportunities for actuaries are expected to grow 18% between 2014 and 2024. The median salary for these professionals was $96,700 as of 2014.

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