How to Become an Actuary
Insurance companies and other businesses employ actuaries to help them make informed financial decisions and minimize risk. An agency that offers car insurance, for example, must decide how much to charge different people for their insurance. An actuary will use math, statistics, and financial theory, plus tools like databases and statistical software, to determine the risk involved in insuring someone based on their age, driving history, and the type of car they own. The actuary can then use these risk calculations to design various insurance plans and set costs.
What kind of training is required to become an actuary?
To become an actuary, you must have at least a bachelor’s degree. Many colleges and universities offer actuarial sciences programs that blend business, mathematics, and statistics coursework. You do not have to major in actuarial sciences to become an actuary, but you should choose courses that will build a strong foundation in calculus, statistics, probability, economics, finance, management, and computer science. College is a great time to pursue internships that will give you the opportunity to apply this broad base of knowledge in an actuarial position. Your internship may lead to a job offer after graduation, but at the very least, you will make professional contacts in the field.
Are there any certification or licensure requirements?
While a degree in actuarial sciences is not essential to becoming an actuary, getting certified is. Before you can work as an actuary, you must begin the process of becoming certified through either the Casualty Actuarial Society (CAS) or the Society of Actuaries (SOA). The first certification you must pursue is an associate certification, which you can earn by following these steps: Pass a Validation of Educational Experience (VEE) in applied statistics, corporate finance, and economics. A committee will review your college coursework, grades, and/or examination scores to see if you have been adequately educated on essential topics in these areas. Complete online courses in professionalism and in the fundamentals of actuarial practice. These classes are offered by each actuarial society. Pass several actuarial examinations. If you seek certification through the CAS, you will take seven exams. The SOA requires five exams. Each exam demands hundreds of hours of study and preparation. Once you have your associate certification and gain a few years of working experience, you can pursue a fellowship certification through the CAS.
How long does it take to become an actuary?
Completing a bachelor’s degree takes most people four years, and it can take four to six years to earn an associate actuarial certification. You have some flexibility in this process, however, and can start your career right out of college if you plan ahead. You have
the best chance of landing an entry-level job if you have your degree, have some actuarial experience, and have passed at least two certification exams. You can begin taking certification exams while in college, so if you pass two exams and take on a few summer internships, you can set yourself up as a strong candidate for employment right after graduation.
What does an actuary earn?
According to the Bureau of Labor Statistics, the median yearly pay for actuaries in the United States was $87,650 in 2010, with the top 10 percent of earners making more than $160,000.
What are the job prospects?
While demand for actuaries is growing, there were only 21,700 actuaries employed in the United States in 2010. Because actuaries are so well-compensated, it’s an attractive field, and competition for jobs can be fierce. You can enhance your prospects by pursuing internships and by passing some associate certification exams before seeking a job.
What are the long-term career prospects for actuaries?
Employment of actuaries in the United States is expected to grow by 27% between 2010 and 2020. Compared to a growth rate of 14% for all occupations during that time, this is a fast-growing field. The Bureau of Labor Statistics expects growth to be strong in health insurance due to the passage of the Affordable Care Act, and especially strong in actuarial consulting. Growth in the life insurance field is expected to be weaker. A career as an actuary has many paths for advancement. If you gain experience and earn a fellowship certification, you can advance into management and executive roles in insurance and consulting agencies.
How can I find a job as an actuary?
Many actuarial jobs are in insurance, so search for openings in insurance agencies. More and more businesses are using actuarial consulting services to manage employee benefit plans and to assess and minimize risk, so you can direct your job search to these firms as well. Most employers are looking for candidates with experience, so it helps to do internships in college. Internships can be great networking opportunities as well. If you find that employers are looking for more experience than what you already have, consider finding other entry-level work at an insurance company. Professional societies like the Society of Actuaries and the Casualty Actuarial Society offer career resources and job boards that you may find helpful.
How can I learn more about becoming an actuary?
The SOA and CAS have collaborated on a helpful resource called Be An Actuary.org. Through this website you can learn more about preparing to become an actuary, including what classes to take in college, how to find internships, and how to prepare for certification exams.