What is an actuary?Credit: http://www.freedigitalphotos.net/

When we say someone is a lawyer or a doctor or a teacher, we tend to have a good idea what it is that they go to work and do on a daily basis.

But when we say someone is an actuary.  What exactly does that mean?  A quick Google search turned up the following definitions.

Wikipedia: a business professional who deals with the financial impact of risk and uncertainty. They provide assessments of financial security systems, with a focus on their complexity, their mathematics, and their mechanisms.

The Society of Actuaries: a business professional who analyses the financial consequences of risk. They use mathematics, statistics and financial theory to study uncertain future events, especially those of concern to insurance and pension programs. They also evaluate the likelihood of those events, design creative ways to reduce the likelihood and decrease the impact of adverse events that actually do occur.

 Actuaries use their analytical skills to manage risk.

 Where do they work?

Actuaries can work in any area where there is risk.  The skills that they have may be utilised throughout the financial sector, particularly in investment and the insurance and pensions industries.

-          As a consultant, they offer advice on issues such as acquisitions, mergers and financing capital projects, and also on occupational pension schemes.

-          Working in investment, actuaries are involved in the pricing and management of investments, particularly in mitigating the risk of investments.

-          Working in life or general insurance, they create and price polices to ensure they have the money to cover claims.

-          A pension actuary will place a value on the accrued commitments of pension schemes.

They also work in other areas such as government, fraternal organisations, college and universities, labour unions and rating bureaus.

Where do actuaries workCredit: http://www.actuaries.org.uk/

What are the skills they need?

They need a diverse set of skills for the work they do. Some of these skills are outlined below.

Personal characteristics:

-          Ability to deal with failure and know that things do not always go according to plan;

-          Superb communication skills (written and oral);

-          Ability to work independently and to also work in a team;

-          Persistence, self-motivation and the drive to succeed;

-          Creative problem-solving.

Technical knowledge:

-          Strong mathematical skills: probability, statistics, calculus;

-          Ability to understand and interpret legal documents.

Computer skills:

-          Ability to formulate spreadsheets and carry out calculations;

-          Ability to manipulate and use word processors and databases.

Business skills:

-          Finance;

-          Economics;

-          Accounting;

-          Current affairs: ability to understand how what is going affects the work to be done.

 Not to worry – in subsequent articles, I will go even deeper into what I have discussed above.  Like what you read?  Be sure to leave a comment below and share this article with your family and friends.