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.
- May ascertain premium rates required and cash reserves necessary to ensure payment of future benefits.
- 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.
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, Mercer LLC, and American International Group, Inc. (AIG). Towers Watson attracts talent by shelling out the biggest paychecks in the area — the median in that office is $164K. Actuaries can also look forward to large paychecks at Prudential ($139K), Metropolitan Life Insurance Company (MetLife) ($135K), and ACE Group ($120K).
Milliman, Incorporated, New York Life Insurance Company, and Mercer LLC are a few other employers known for handing out relatively lightweight salaries ($85K, $94K, and $95K respectively).
Popular Skills for Actuary
Actuaries report using a pretty varied skill set on the job. Most notably, facility with Pricing, Financial Modeling, and SAS are correlated to pay that is significantly above average, leading to increases of 30 percent, 26 percent, and 20 percent, respectively. Most people who know Data Analysis also know Financial Analysis and Financial Modeling. Those who learned Microsoft Excel also tend to 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.
Experience and income seem to be closely related; in general, the survey respondents who had worked for more years reported higher incomes. Although inexperienced employees take home approximately $65K, those who have five to 10 years under their belts benefit from a six-figure median of $112K. Actuaries bring in $133K after working for 10 to 20 years. More than 20 years of experience mean a somewhat bigger median paycheck of $144K, but it's not much more than what less experienced people make.
Pay Difference by Location
For Actuaries, San Francisco provides a pay rate that is 29 percent greater than the national average. Actuaries will also find cushy salaries in Chicago (+22 percent), Philadelphia (+22 percent), Hartford (+21 percent), and Seattle (+20 percent). Columbus is the lowest-paying area, 13 percent south of the national average. On the whole, employers pay 10 percent below the median salary for those in this field in Minneapolis and Denver.