Actuarial Analyst Job Description, Skills, and Salary
Get to know about the duties, responsibilities, qualifications, and skills requirements of an actuarial analyst. Feel free to use our actuarial analyst job description template to produce your own. We also provide you with information about the salary you can earn as an actuarial analyst.
Who is an Actuarial Analyst?
An actuarial analyst is a business expert who solves difficult financial problems using mathematical and statistical skills. They have a strong grasp of the financial system, are analytical, and have excellent problem-solving abilities. Actuarial analysts assist their organizations or clients in resolving complicated financial problems, particularly those involving uncertainty. Mathematics, statistics, economics, actuarial science, insurance, physics, accounting, and finance are all common academic backgrounds for actuarial analysts. Despite this, they all have one thing in common: a fascination in mathematics and statistics.
Another alternative to becoming employable is to become an actuarial analyst. According to the Bureau of Labor Statistics, the profession paid a median pay of $111,030 in 2020 in the United States, with projected job growth of 24% between 2020 and 2030.
Actuarial Analyst Job Description
Below are the actuarial analyst job description examples you can use to develop your resume or write an actuarial analyst job description for your employee. Employers can also use it to sieve out job seekers when choosing candidates for interviews.
The actuarial analyst performs the following functions:
- Reporting on the conclusions of the analysis.
- Assisting in the creation and pricing of insurance plans.
- Identifying new data sources.
- Providing technical help and analysis
- Collecting data from a variety of sources and evaluating its completeness and accuracy
- Performing data analysis and providing recommendations for suitable actions.
- Using specialized tools to conduct extensive statistical examinations.
Qualifications
The qualifications required to practice as an actuarial analyst are thus:
- A degree in mathematics, statistics, or actuarial science is required.
- Working knowledge of spreadsheets and databases.
- Familiarity with statistical analysis software such as Insightful S-PLUS and Wolfram Research Mathematica.
- Problem-solving, critical thinking, and communication skills.
- Basic familiarity with computers and electronics is required.
- Basic understanding of laws, legal codes, and rules.
- Understanding of business and money at a basic level.
Essential Skills
To be effective, actuarial analysts must possess a diverse set of abilities, and below are five of them:
- Problem-solving abilities that are analytical
Actuarial analysts must be analytical problem solvers because one of their responsibilities is to analyze complex data and uncover patterns and trends in order to determine which causes are responsible for specific outcomes. Actuarial analysts seek strategies to reduce the possibility of bad outcomes or the expense of achieving an unfavorable outcome after considering and weighing the importance of these elements.
- Numeracy and Maths Skills
Because actuarial analysts work with numbers, they must be able to execute fundamental arithmetic quickly and correctly. The arithmetic related to actuarial science, on the other hand, can be more difficult. Actuarial analysts must be familiar with calculus, statistics, and probability in order to quantify risk and predict the likelihood of various outcomes.
- Computer Proficiency
The actuary’s instruments include computers and a variety of statistical modeling software. When evaluating vast amounts of data, actuarial analysts commonly employ models and tables. Basic computer abilities and a working knowledge of Microsoft Office are required, but knowing how to write in a statistical programming language is also required.
- Business and financial knowledge
Businesses, financial institutions, and insurance companies commonly hire actuarial analysts. As such, they are in charge of assessing insurance and pension plans, counseling businesses on how to reduce financial risk and giving banks expert recommendations on how to maximize profits on a variety of investment products. This demands a deep understanding of financial and commercial concepts.
- Interpersonal and Communication Skills
Actuarial analysts work with a wide range of people, including programmers, accountants, and senior management, so they must be able to communicate and collaborate effectively. Actuarial analysts with strong oral communication skills can explain difficult technical and statistical data to a wide range of audiences, while great writing skills guarantee that findings and solutions in memos and written reports are clearly understood. Actuarial analysts are frequently in charge of teams working on a variety of projects and must be able to deal with a wide range of personalities.
Steps to Becoming an Actuarial Analyst
You’ve come to the right site if you’re wondering how to become an actuarial analyst and want to know the exact steps you should take. I’ll walk you through the eight steps you’ll need to take to become a fully qualified actuarial analyst in this blog.
- Get your bachelor’s degree first.
Obtaining a Bachelor’s degree is the initial step toward becoming an actuarial analyst. Although this stage isn’t officially essential to become an actuarial analyst, it’s highly encouraged because a company is unlikely to hire someone who doesn’t have one.
It doesn’t matter what subject of study you’re in. A degree in actuarial science, statistics, business, economics, or finance would be beneficial. If calculus, algebra, finance, statistics, economics, and computer science are not required for your Bachelor’s degree, you should study those courses as electives. This knowledge will be incredibly useful in the workplace and on actuarial tests.
It’s fine if you’re a career changer who didn’t major in one of those disciplines. You will not be held back if you have a Bachelor’s degree. If you’re thinking of pursuing a Master’s degree, read this first! If you wish to be an actuarial analyst, I strongly advise you not to do so.
If you’re debating whether or not to major in Actuarial Science, you should know that there are both advantages and disadvantages to doing so.
My recommendation is that you pursue a degree in a more general subject of study. Because actuarial science is such a specialist degree, majoring in it narrows down your prospects significantly. It’s important to remember that just because you’re interested in becoming an actuarial analyst now doesn’t mean you will be in the future. You should keep your options open in case you decide you don’t like actuarial work or the process of becoming an actuarial analyst is longer or more difficult than you anticipated. As a result, having a more general degree (such as statistics, business, finance, economics, etc.) opens up more work prospects for you. Because most individuals are unaware of what an actuarial science degree entails, it is not highly valued outside of the insurance business.
- Pass the First and Second Exams
The second stage in becoming an actuarial analyst is to pass two actuarial tests. The Society of Actuarial analysts offers Exam P and Exam FM, which are the first two tests most people take.
There are a total of ten tests, so you can imagine how dedicated you must be to become a qualified actuarial analyst. Exams P and FM typically have a pass rate of 40 percent to 50 percent. Only 40–50% of candidates pass each sitting, implying that only 40%–50% of candidates pass each sitting. To pass, they must receive a grade of approximately 70%.
- Enhance your technical abilities
Following that, you’ll need to improve your technical computer and programming skills. This is generally done when you’re still in school, similar to actuarial tests. Your technical abilities will come in handy when applying for internships and your first actuarial employment.
Excel proficiency is one of the most critical skills for an aspiring actuarial analyst to have. You’ll need to know how to utilize vlookup, hlookup, and if statements, among other things. Filtering and sorting data, as well as using conditional formatting and pivot tables, are more sophisticated abilities to have.
Computer programming is another technical talent that will be valuable as an entry-level actuarial analyst. VBA, which is used to automate activities in Excel and other Microsoft programs, is the first coding language I recommend you learn. Because so many entry-level actuarial analysts use Excel, there will be plenty of opportunities to put these skills to work. It will save you many hours of tedious manual labor.
Python and SAS are two other coding languages that might be useful to master (but aren’t as vital as VBA).
Employers will place a great value on technical abilities, and you’ll be glad you have them once you start working. It’s an excellent technique to improve your resume and increase your job market competitiveness.
- Participate in an Actuarial Internship
Before you graduate from college, you should try to get at least one actuarial internship. Because finding an actuarial internship can be difficult at times, there are alternative comparable professions that can still be beneficial to your career and portfolio.
For an aspiring actuarial analyst, internships in or connected to underwriting, data analysis, risk management, or investing would all be excellent options. Most employment in an insurance firm would be excellent if you wanted to learn more about how insurance products work.
To earn an internship, you’ll need to pass at least one exam and be willing to work in a variety of locations (geographically). Try not to be too choosy about the options you have. After all, an actuarial internship will greatly increase your prospects of succeeding in the field of actuarial science.
An actuarial internship will not only help you get experience for your resume, but it will also allow you to assess whether you enjoy an actuarial job. That’s something you’ll want to know right now!
An internship will also help you get your foot in the door to insurance companies that may hire you in the future. If you can demonstrate to them that you’re a dedicated worker who knows what you’re doing, they’ll likely hire you full-time when you finish school.
Unfortunately, internships are frequently given to students (though this is not always the case). If you’ve previously graduated and/or are changing careers, there are still some alternatives available to you. You might apply for jobs (rather than internships) in the same fields as the internships I described above. These would be an excellent first step in becoming an actuary. You might also look for volunteer opportunities to gain some of the same experience. Any chance you can find to put your analytical talents to use will help you boost your resume.
- Find an Entry-Level Actuarial Position
Everything you’ve worked for up to this point is now coming together, which is a very exciting time. This phase is frequently completed concurrently with Step 6, which entails passing additional examinations.
Fortunately, you can begin working as an entry-level actuary before completing all of your tests. In order to secure a job in the United States, you normally need to pass two or three tests. Because the job market in Canada is more competitive, passing 4-5 examinations is more frequent for an entry-level actuarial career.
When you start your first actuarial job, you’ll quickly realize how much you’ve learned! In the first few years, there is a steep learning curve.
You’ll begin to understand how fascinating and exciting insurance principles are. Everything I had learned up to that point in tests was useful in my first actuarial job, but the on-the-job experience really helped me put it all together.
When you’re at work, you’ll want to make sure you’re learning as much as you can and asking lots of questions so you can produce high-quality work. Other actuarial analysts are usually friendly and prepared to assist.
You can start bringing more value to the organization once you’ve been in your role for a few months. You can start thinking about methods to enhance processes, and you might even be able to add useful information to discussions. That will distinguish you as a valuable part of the actuarial team, and you will be rewarded for it.
Of course, you may do this at your internship as well, but chances are you won’t have as much time.
- Achieve your Associateship credentials
Associateship is the initial level of actuarial education. An ACAS is an Associate of the Casualty Actuarial Society, and an ASA is an Associate of the Society of Actuarial analysts. To get one of these credentials, you’ll need to pass seven examinations (including the two you passed in step 2), as well as a few other, simpler prerequisites.
You will not be given both titles. That isn’t required. Whether you want to be a life or health insurance actuary analyst or a property and casualty insurance actuary analyst will determine which one you choose.
If you want to work as a property and casualty insurance actuarial analyst, you’ll need to have the ACAS certification (through the CAS). If you want to work as an actuarial analyst in life and health insurance, you’ll need to have the ASA certification (through the SOA).
Choosing between CAS and SOA is a major decision. It will have an impact on the types of employment you can apply for and the examinations you take in the future. Fortunately, the first three actuarial tests are identical in both societies (Exam P, FM, and IFM).
- Acquire a Fellowship
You must pass all ten of your tests before you may be considered for fellowship. Fellowship signifies that you are an actuary who is fully qualified and accredited.
When you have full-time work, you will be able to finish your tests. To advance from associateship to fellowship, you must pass three more tests. Passing the examinations and meeting the other (less difficult) prerequisites often takes 2-4 years.
When you work in the actuarial sector, your employer will most likely cover the cost of your study materials and exams, as well as provide you with compensated study time. All of these perks come with becoming a part of the company’s “Actuarial Student Program.” When you’re interviewing for jobs, seek and inquire about a solid student program.
You’ll want to know what kind of support their actuarial team receives.
In addition to the three fellowship-level tests I mentioned, there are a few extra prerequisites to satisfy in order to achieve fellowship. The particular requirements differ depending on whether you use SOA or CAS.
You’ll either be an FSA (Fellow of the Society of Actuarial analysts) or an FCAS (Fellow of the Society of Actuarial analysts) once you’ve met all of the prerequisites (Fellow of the Casualty Actuarial Society).
- Ascend the corporate ladder to a management position
Although this level is not required to become a fully qualified actuarial analyst, it is the next step in your career (if you want it to be). At this point, you begin to rise up the ranks. You’re moving up the corporate ladder, earning more money, and taking on more responsibilities. A small actuarial team will most likely report to you.
You’ll be doing less and less of the technical work that you did as an entry-level actuary at this stage. You get more experience and information, and you normally go to higher-level business planning and thinking. All technical work will be done for you by your team.
Where Actuarial Analysts Work
Anywhere there is finance and risk, an actuary can work. This is true for practically all businesses. Employers employing actuarial analysts often include companies that provide insurance and reinsurance; consulting firms; health management organizations; commercial banks; pension fund administrators; government; colleges and universities; and so on.
Actuarial Analyst Salary Scale
In the United States, the average compensation for an actuarial analyst is $77,529 per year. In the United Kingdom, however, an actuarial analyst’s typical starting income is £20,000. The starting salary for a certified actuarial analyst (CAA) is roughly £25,000. However, if you continue your education to become a professional actuarial analyst, you can expect to earn an average of £52,000 a year plus bonuses.
