Actuaries work with numbers and statistics in order to determine risks for a variety of industries.
Although Actuaries mainly work in the insurance industry, there is a growing trend within the financial and consulting industries that require an Actuary’s skills in determining risk factors.
Actuaries use their skills in statistics, finance and business in order to evaluate the risks associated with an event.
Using this information, they help their clients or employers create modifications in policies or procedures in order to reduce any costs associated with the risk.
Students who have a knack for mathematics, statistics and solving problems may consider a career in this field.
To learn more information regarding a career as an Actuary, read the following information which includes education requirements, a general job description, salary and wage data as well as the future job outlook through the year 2018.
Education Requirements to Become an Actuary
Students who want to become an Actuary need strong mathematical and business schools in order to be competitive in the field.
In addition, candidates must also take a series of certification tests in order to become an Actuary.
It can take a candidate between four to eight years in order to complete their education and become a certified Actuary and full professional status.
There are approximately 100 educational institutions that offer an Actuarial Science degree in the United States.
Students who want to attend an educational institution that offers an Actuarial Science program can visit this webpage to choose a school.
For universities or colleges that do not offer an Actuarial Science, students can major in a wide range of disciplines as long as it has a strong foundation in math in order to become an Actuary.
Some recommended majors are listed below:
- Actuarial science
Students can also double major in two of the aforementioned disciplines in order to stand out to potential employers.
The types of classes students should focus on to strengthen their mathematical skills include: applied statistics, corporate finance, economics.
These classes are also a requirement in order to take the certification exam.
There are two organizations that administer and grant certification for Actuary professionals.
Under their guidelines, candidates need to take a series of exams in order to become an Actuary.
In addition, candidates must fulfill requirements before they qualify to take the exam.
Actuary Job Description
The majority of Actuaries are employed in the insurance industry although there is a trend within the financial services and consulting industries to hire experienced Actuaries to provide statistical information.
Insurance companies require an experienced Actuary and their skills in order to assess risk.
An Actuary will begin by analyzing information collected about the industry they work in.
The following list includes some typical data that Actuaries use in order to determine the probability or likelihood that a specific incident will occur.
- Illnesses such as diabetes, heart disease, cancer, stroke or other ailments
- Loss of property
- Financial information
Actuaries will analyze these types of risks in order for a company to determine how to use its resources, minimize costs and eventually create a profitable return of investment.
Actuaries who work in the financial services will help clients determine how to invest and how to increase their desired income for retirement.
Actuary Salary and Career Path
The Bureau of Labor Statistics reports that the median wage in 2008 for Actuaries was approximately $84,800 per year.
The salary range for these professionals during the same year was approximately $49,000 to $160,000 per year.
Wages will depend on the sector, location and years of experience.
The job outlook for Actuaries looks promising and is expected to grow by 21 percent through the year 2018.
Some of these job opportunities will occur in the financial services and consulting sectors.
This growth can be attributed to the need to calculate risks in order to develop and price insurance products.
However, this growth will be affected by the number of candidates wanting to enter the field.
Frequently Asked Questions
What does an actuary do?
In case you decide to become an actuary, you have to be ready to deal with numbers all the time, as these professionals use statistics to determine the probability of risks and, later on, to determine the financial consequences of those.
An actuary usually works with underwriters and accountants and then comes up with the right numbers for insurance companies (helps determine insurance rates).
Insurance companies insure businesses or individuals; of course, there has to be someone who will help the company evaluate the risks that it takes, and that is exactly what actuaries do.
The specialists try to give an accurate depiction of the risks to the insurance company (the risks include floods, fires, mortality, unemployment, and so on).
Actuaries can specialize in one type of insurance (like automobile or health, for example) or be certified in all of them.
How much do actuaries make?
On average, an actuary can make nearly $103.000 per year in the United States.
In case you decide to follow this career path, you can expect to earn a very good salary that ranges from $61.000 to $186.000 and even more.
The salary will depend a lot on the experience of the actuary, the number of examinations that you have passed, the employer, and the geographical location.
Actuaries that work in New York, Washington, and the District of Columbia, for example, have the highest average salaries.
An entry-level actuary can earn around $29 per hour; while a top-level professional with plenty of experience can make over $89.
How much does it cost to become an actuary?
Employers look for aspiring actuaries that have a bachelor’s degree in finance, business, economics, statistics, accounting or anything related to the future profession.
A year in a university can cost you $8.000 or $30.000 and even more; the cost depends on a wide range of factors.
Actuaries have to pass exams, in order to be able to work in the industry.
The SOA (Society of Actuaries) exam fee is $225, for example.
What is the demand for actuaries?
Between 2016 and 2026, the actuary job market is expected to grow by 22.5% in the United States.
Those who possess a bachelor’s and a master’s degree will have better chances of getting the highest-paid jobs.
The field certainly does have high competition levels.
Bear in mind that the industry is concentrated in Illinois, New York, and Pennsylvania.
How long does it take to become an actuary?
It will take you 4 years to acquire a bachelor’s degree.
In case you want to make sure that you have better job prospects in the future, you should consider going for a master’s degree that will take 1-2 years to obtain.
To gain some relevant work experience, you might want to seek an internship during your final years at university.
To take the exam, an aspiring actuary might need some study materials; those include books or video lectures that will take everyone a different amount of time to learn.