Eames Consulting Group has been working closely with senior actuarial professionals in Asia to get their perspective on the 2020 market, the future of the actuarial industry and how to get the most out of your career. We have put together a series of interviews with key actuaries from different cities and interesting insight into the market across the region.
Can you see actuarial roles and subsequent duties changing over the coming years within insurance and if so why?
Actuarial has been an everchanging profession as insurance has transformed tremendously across time. Actuaries have always managed to respond to these changes successfully, adapting their work to the evolution. For example, in the past actuaries used to develop contingency models for life insurance and motor insurance generalized linear models to differentiate drivers, risk factors, and now some actuaries have started to work on climate change risks and epidemiologic models, which are really topical in today’s world. Elon Musk recently called actuaries to join Tesla, showing good signs that the profession has a bright future as actuaries are directly associated with insurance. What I personally see in my own context is more and more tasks being automated and therefore more time freed leading to a shift towards more analysis, which is probably more interesting in its essence.
Where do you see the GI Actuarial market heading within Asia (especially Singapore)? Will there be an increase in demand for professionals with this skillset?
Asia is a patchwork of very different countries compared to Europe. It comprises countries of different sizes, different maturities, different regulations/regulators and different social environments. For example, some regulators impose nationals to be in-house appointed actuary whereas others will be more flexible and allow offshore consultants to take such roles. The Singapore market is open, competitive and technically mature. The demand for GI Actuaries continues to increase and to illustrate this, one example comes to my mind: the Singapore Actuarial Society organizes an actuarial career fair every year and I remember 5 to 10 years ago only a few companies had booths with hundreds of students, but last year there were 20 booths and I remember the vision of students being scarce in the middle of the very large hall. Singapore universities have increased the number of actuarial students for the past decade, but the efforts need to be continued.
What are your views on data science being involved within actuarial teams?
GI Actuaries have always been naturally dealing with data, sometimes with a lot of data. My own actuarial school asked us to code in various languages 20 years ago and this proved to be useful. Coding skills have become a must have and Asian countries have a lot of aspiring actuaries equipped with this skillset. I saw the actuarial schools in Singapore training their students accordingly and this is a very positive move. When data became the new hype 5 or 6 years ago, many insurance companies hired data scientists and later realized that actuaries have been doing something rather similar for decades (of course with the means and data quantity allowed at that time) with insurance expertise. Eventually, we saw some insurance companies merging these actuaries and data scientists for better synergy.
What are your views on IFRS17 regulations and how is your organisation working towards this?
If general insurance (my practice area) is less impacted than life insurance, there are still some important components to take into consideration such as cash-flow projections, profitability by inception periods and treatment of reinsurance, to name a few. This would require some improvements in what valuation actuaries normally do, and the most technically sophisticated teams should not experience major disruptions.
Working on IFRS17 is a good opportunity for actuaries to understand better accounting topics and principles. Finally, understanding the “why” we change to the new standards and how it will impact the way insurance companies do business is essential.
Throughout the market in Asia, we are seeing growing investment in moving products onto digital platforms. What are your views on the digitization of products and upcoming insurtechs throughout the region?
Moving products onto digital platforms is not new, it started more than 10 years ago. We have seen insurance companies undertaking this journey with different operating models and levels of outsourcing (to Insurtechs for example), and eventually with more or less success. Digital transformation in insurance is not about the “if”, but more about the “how” as many aspects need to be considered: how receptive the market is (customers and distributors), how simple, competitive and scalable the product offer is and how it integrates with company’s operations and IT systems. It also depends on the “who” as insurance is an industry with a lot of specificities and recipes from retail, F&B or banking industries might not be replicated easily for insurance.
For an aspiring junior actuary, do you have any advice for them as they grow in their career and what can they do to stand out?
Passing actuarial exams is the typical first step for a junior actuary. It can be a rather onerous process as it takes up personal time for a couple of years while professional performance is also a requisite from the employer. However, becoming Fellow of an actuarial body is only the real start of a career as it unlocks some doors to the path of success. Public speaking and influencing skills, ability to clearly present your work to different audiences, getting exposure to the business and making an impact. These are some of the challenges young Fellows can be exposed to. My advice to aspiring junior actuaries would be to start developing these skills now – even before becoming a Fellow.