Job Description for Actuary
Actuaries play a key role in insurance companies by serving as analysts who help determine whether the company should issue an insurance policy and what the premium for that policy should be. They use a great deal of statistical analysis in their work, as they examine huge amounts of data related to costing and trends. Insurance companies must always maintain their financial health, and the role of the actuary is to manage risk in the delicate balance between issuing policies (and the costs paid for them) and the exposure to financial risk for the company.Read More...
Often, actuaries help add statistically-significant data to data models for insurance companies and then analyze related effects on insurance policies. This typically includes examining incident data (such as car accidents by location or age ranges in auto insurance) and then adjusting rates and terms as necessary; they may also occasionally pull disparate data from a variety of sources for these adjustments. For example, those who work with homeowner's insurance may regularly assess not only crime data in a neighborhood, but also patterns of destructive weather where previous claims have been paid. This ongoing re-calculation of risk exposure for the insurance company is an actuary's primary responsibility.
Candidates for this position should have a college degree in actuarial science or a field related to statistical analysis. They must also be highly experienced with computers and able to quickly manage large data streams to discern trends and useful information. Most actuaries work for insurance companies, although some financial service companies may have actuarial departments which manage investment risks. Actuaries generally work in office environments during traditional business hours.
- Analyze statistical data, such as mortality, accident, sickness, disability, and retirement rates and construct probability tables to forecast risk and liability for payment of future benefits.
- May ascertain premium rates required and cash reserves necessary to ensure payment of future benefits.
Actuary Job Listings
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Popular Employer Salaries for Actuary
Actuaries fill the offices of leading firms Humana, Inc., Metropolitan Life Insurance Company (MetLife), Towers Watson, American International Group, Inc. (AIG), and New York Life Insurance Company. Those at Towers Watson can expect to make the most, with the company offering a median salary of $164K. Also paying near the top of the field are Prudential at $137K, Metropolitan Life Insurance Company (MetLife) at $135K, and ACE Group, where Actuaries annually earn $120K.
A few other companies with smaller-than-average paychecks include Milliman, Incorporated ($85K), New York Life Insurance Company ($94K), and American International Group, Inc. (AIG) ($100K).
Popular Skills for Actuary
Survey results show that Actuaries use a fair number of skills. Most notably, facility with Pricing, Financial Modeling, and SAS are correlated to pay that is significantly above average, leading to increases of 34 percent, 24 percent, and 20 percent, respectively. Skills that seem to negatively impact pay include Microsoft Access. Most people skilled in Data Analysis are similarly competent in Financial Analysis and Financial Modeling. The majority of those who know Microsoft Excel also know Financial Modeling and Financial Analysis.
Pay by Experience Level for Actuary
Median of all compensation (including tips, bonus, and overtime) by years of experience.
Actuaries who reported more years of relevant experience also reported higher earnings. The relatively untested earn a median of $65K per year, but survey respondents who have racked up five to 10 years of experience report a six-figure median of $112K. Actuaries claiming one to two decades of experience make an estimated median of $134K. More than 20 years of experience mean a somewhat bigger median paycheck of $146K, but it's not much more than what less experienced people make.
Pay Difference by Location
For those looking to make money, Actuaries in Portland enjoy an exceptional pay rate, 43 percent above the national average. Actuaries can also look forward to large paychecks in cities like Washington (+38 percent), Seattle (+31 percent), Boston (+25 percent), and San Francisco (+24 percent). Trailing the national average by 15 percent, Dallas is the market with the smallest paychecks. Employers also pay below the national average in Nashville (5 percent lower) and Cleveland (3 percent lower).
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Key Stats for Actuary
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