What is an Insurance Actuary?

by Anna Glendenning | More from this Blogger

02 Mar 2007 11:55 AM

Life is filled with uncertainty. We all face events that are unexpected and happen. "Risk" what is possible--those things that could be horrible--but, might actually happen to us.

An Actuary is a person who is an expert in the following skills:

• Evaluates of the possibility that something horrible might happen in the future.
• Looks for simple, and creative ways to control, eliminate or reduce the odds of something horrible happening in the future.
• Finds methods to decrease the impact when something horrible does actually happen.

Insurance serves one major function and that's to help decrease the impact when something horrible does happen. An actuary muse be skillful in considering the emotional and financial impact a person faces when something horrible does happen. A good risk includes people who want to identify and reduce the odds of a horrible event happening to them. These people understand insurance is to help relieve some of the financial pain and in many ways this helps reduce the emotional pain suffered. Some horrible events we suffer in life, such as the death of a loved one, can't be avoided. Insurance might offer a way to reduce the financial impact to this persons family.

Actuaries are the professionals who find mathematical ways to manage the odds of a risk. An actuary uses analytical skills, business knowledge and understanding of human behavior to create and manage programs designed to control risks. Actuaries are key management members in the companies they work. They have a fast-paced environment, with new risks to evaluate and create management ideas. An Actuary has and never ending opportunity for professional and personal growth.

Most Actuaries have careers associated with the insurance industry, in one way or another. Insurance is society's most powerful solution for managing and controlling risk. Insurance is a method of reducing a policyholders risk for financial loss by purchasing a contract of insurance transferring the financial risk to the insurance company. The Insurance companies depend on the skills of the actuary to design insurance plans that accept the contract of insurance and take the financial responsibility for a risk and how much the insurance contract should cost the policy holder.

Actuaries are one of the most important people for insurance companies. Their role is key for insurance companies design plans. Actuaries set the premium, and monitor the insurance companies profitability. The Actuary is responsible to recommend corrective action when required, such as increased premiums or eliminating some kinds of coverages. Insurance companies rely on an Actuary to ensure they have set aside enough reserve funds to pay all the claims they might suffer. Actuaries also advise insurance companies on the best investments for the companies' assets.

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Related Blogs:

• What is the Business of Insurance?
• Insurance Careers: Intro From Top to Bottom.
• Insurance Careers: Part One

Glossary of Insurance Terms:

A | B | C | D | E | F | G | H | I | J-K | L | M | N | O | P | Q-R | S | T | U-V | W-Z

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Insurance Careers, Insurance Actuary, The Business of Insurance