How actuaries are being made

Today’s modern economy is driven by predictions.

It’s a lot harder than it sounds. Before predictions involving multi-billion-dollar projects are made, risk is assessed and buffers for worst-case scenarios are estimated. The same applies at banks and insurance corporations where ideal rates of interest are ascertained. Low rates mean less profit while higher rates have the propensity to scare customers.

Only the sharpest minds are encouraged to pursue actuarial science, largely considered a ‘zero unemployment profession’

In this light, actuaries – brilliant mathematicians who use their expertise to evaluate risk and probabilities – play pivotal roles and the job is regarded as a ‘zero unemployment profession’.  And while it is important for an actuary to possess sound technical knowledge, knowledge alone does not make a good actuary.

According to UCSI University’s head of department (Actuarial Science & Applied Statistics) Associate Professor Dr Ngerng Miang Hong, a sterling reputation and an upright character sets actuaries apart from other brilliant minds.

"For example, while other members of the management board could be inclined to extract more immediate profit in order to boost their apparent contributions to the company, an actuary has to safeguard the policyholders' interest," he explains.

"Are the reserves enough to honour all future claims? This is what an actuary asks and finds out before approving the figures for the company's annual profit.”

Looking at the invaluable role actuaries play, it is no surprise that the US Bureau of Labor Statistics forecasts an increase in career prospects for actuaries by 27% from 2010 to 2020 – the highest growth rate across all occupations.  And as demand continues to escalate for more actuarial professionals in the world, it is anticipated that Malaysia too will witness the bloom of the actuarial industry in the near future, as there are still many areas with growth potential.

Grueling preparations

 The actuary profession is one of the most regulated. One must pass professional examinations and various on-the-job assessments, in addition to obtaining a degree. 

The Society of Actuaries (SOA) is one of the most prominent professional organisations for actuaries in the world. The journey to become a qualified actuary is outlined by SOA into four stages:

• Stage 1 - The first is the Validated by Educational Experience stage where students who receive grades of 70% and above for subjects in economics, corporate finance and applied statistics – will receive credit for these professional papers.

• Stages 2 & 3 - The second stage involves five preliminary exams that candidates must pass before proceeding to the penultimate stage, namely, the Fundamentals of Actuarial Practices course and the Associateship Professionalism Course (APC). This will qualify them as an Associate of the Society of Actuaries (ASA).

• Stage 4 - The final hurdle would be to qualify as a Fellow of the Society of Actuaries (FSA). To attain the FSA designation, a candidate must successfully complete the requirements that include examination, e-learning courses and modules, validation of education experience outside the SOA education system (VEE), a professionalism seminar, and the Fellowship Admissions Course.

Education like no other

UCSI University is one of the few private universities in Malaysia to offer such a course in this niche field. Its actuarial science programme, however, is unlike conventional courses.

[caption id="attachment_28738" align="alignright" width="368"] 

Chan Min Zhuo is one of the few local students to pass four Society of Actuaries Preliminary Exams in just over two years. Even before graduation, he has secured full employment in the actuarial department of a global insurance company[/caption]

In line with requirements of the Society of Actuaries (SOA) – the largest professional organisation for actuaries in the world, the course provides students with a world-class degree and grooms them to have the rigorous capacity to ace the professional examinations they are required to sit for.

"Students have only three years of full-time study to prepare them for the professional examinations and on-the-job assessments during the span of their careers," says Melissa Migin, dean of the Faculty of Business and Information Science that is in charge of the BSc (Hons) Actuarial Science.

"It is a heavy responsibility for us as we want to ensure that within their three years with us, we prepare them for the next 30-years or more of their career."

Following the praxis™ approach that advocates the application of theory to practice, the actuarial science programme at UCSI is infused with the industry experience of actuaries and dedicated lecturers who are well-versed in economics, mathematics and statistics.

Furthermore, the University has made collaborative arrangements with several insurance companies, agents and consultancy firms, among others, through cooperative placements that allow students to experience the real actuarial work environment.

Unlike conventional internships that only require students to complete a one-off internship stint, UCSI students are required to intern for two months of every academic year – a move that has won critical acclaim among employers and the students themselves.

In 2012, a total of 1,662 companies participated in this programme and 99.15% of the students indicated their satisfaction with the jobs obtained after the Co-Op placement.