The field of actuarial science is slowly gaining popularity and recognition in India. A career in this field involves the application of math, statistical knowledge, skill in risk assessment, and evaluation of financial products such as insurance and investments.
What does an actuary do?
Actuaries analyze past data and use that information to determine how much money should be set aside to cover the financial losses which could occur in the future.
Let’s take car accidents as an example. If an actuary wants to predict how many people in Pune will get in an accident in November, this year, they will look at the percentage of people involved in accidents in the previous years.
Based on that data, the actuary will identify a trend and use it to predict the percentage for this year and establish how much each person should pay for their insurance so that it would cover the damages of a car crash.
One of the main challenges for an actuary is when there isn’t any past data or when the data isn’t relevant due to policy or other types of changes.
Admission requirements for Actuarial Studies in Foreign Universities
These are the general requirements you can expect during the application process. Some universities may ask you for more documents, while others also accept students with a Bachelor’s degree that’s not related to Actuarial Studies.
Bachelor’s in Actuarial Science
- Minimum English language test scores: IELTS – 6 or TOEFL – 80
- High-school transcript of records
- Letter of recommendation
- Financial certification
Master’s in Actuarial Science
- Minimum English language test scores: IELTS – 6.5 or TOEFL – 85
- Bachelor’s degree in Mathematics, Statistics, or a related field
- Minimum GPA: 3.0
- GRE test scores
Best Actuarial Science universities and colleges Abroad
According to the Society of Actuaries, these are some of the best universities and colleges for Actuarial Studies:
- Australian National University, in Australia
- Heriot-Watt University, in the UK
- Illinois State University, in the US
- Simon Fraser University, in Canada
Actuarial Exams
You need to pass the actuarial exams to become a qualified actuary. These are independent exams and aren’t related to academic institutions.
Actuarial exams are difficult and require intense preparation. This is why most people need between 7-10 years to pass all of them. Each exam can take between 3-5 hours and involves both multiple-choice questions as well as written answers.
The good news is you can work as an entry-level actuary assistant or junior analyst while taking the exams. Your hard work will pay off, as many companies support employees and reward them financially for passing their actuarial exams.
Actuarial Courses in India
The Institute of Actuaries of India (IAI) regulates the education & training of actuaries in India. When a student becomes a member of IAI by clearing the ACET exam [Read: All about “Actuarial Common Entrance Test” (ACET)], it is understood that he possesses the skills required to become a successful actuary.
Following are the eligibility criteria to become an actuary:
- 10+2(H.S.C) or equivalent
or - Graduate or Post Graduate in Mathematics, Statistics, Economics, Computer Science, Engineering, MBA (Finance) and other similar qualifications.
or - Fully qualified members of professional bodies such as:
- The Institute of Chartered Accountants of India
- The Institute of Cost and Works Accountants of India
- Certified Institute of Financial Analysts of India
- Fellow of Insurance Institute of India
- Highly proficient in mathematics & statistics
After clearing ACET, you can apply online (www.actuariesindia.org/Admission_login.aspx) to become a student member of IAI.
“To become an actuary, you need to pass all actuarial exams (15 of them!) and have 3 years of practical work experience. Passing exams will require students to have application skills as just mugging up the study material will not make them pass exams (certainly not some of the higher level exams). Actuarial science is a distant learning program (just like chartered accountancy). One shall have to study on his / her own. There are, though, some coaching institutes that provide coaching for actuarial subjects.”
Actuarial exams by IAI
The 15 actuarial exams conducted by IAI include 9 written exams and 3 practical exams:
Stage 1: Core Technical (CT)
You have to either pass all these 9 exams:
| CT1 | Financial Mathematics |
| CT2 | Finance and Financial Reporting |
| CT3 | Probability and Mathematical Statistics |
| CT4 | Models |
| CT5 | General Insurance, Life and Health Contingencies |
| CT6 | Statistical Methods |
| CT7 | Business Economics |
| CT8 | Financial Economics |
| CT9 | Business Awareness Online Module (Practical Exam) |
Stage 2: Core Application (CA)
You have to pass all these 3 exams:
| CA1 | Actuarial Risk Management |
| CA2 | Model Documentation Analysis and Reporting (Practical Exam) |
| CA3 | Communication (Practical Exam) |
Stage 3: Specialist Technical (ST)
At this stage you can specialize and choose any 2 subjects out of the 6 offered:
| ST1 | Health and Care |
| ST2 | Life Insurance |
| ST3 | Pension and Other Employee Benefits |
| ST4 | Finance and Investment A |
| ST5 | Finance and Investment B |
| ST6 | General Insurance Reserving and Capital Modeling Specialist Technical |
| ST7 | General Insurance Pricing Specialist Technical |
| ST8 | Enterprise Risk Management |
Stage 4: Specialist Application (SA)
You can choose any 1 subject (preferably corresponding to the ST subjects you chose):
| SA1 | Health and Care |
| SA2 | Life Insurance |
| SA3 | General Insurance |
| SA4 | Pension and Other Employee Benefits |
| SA5 | Finance |
| SA6 | Investment |
Once you clear all the 9 CT papers & all the 3 CA papers, you are eligible to become an Associate Member of the IAI. And once you clear all the 15 papers you can become a Fellow Member of the IAI
Career Opportunities In India
An actuary in India typically works in the following fields:
- Life Insurance
- General Insurance
- Health Insurance
- Reinsurance Companies
- Pension Funds
- Consultants
- Investments
- Government
- Academics
- Risk Management
The role that an actuary can perform in each of these sectors can be quite varied, such as product pricing, financial modelling, valuations, risk management, carrying out peer reviews, designing social security schemes, advise on the premium to be charged etc.
Outside of India, there is a huge demand for actuaries in both the developed as well as emerging markets. Actually, there is lack of supply particularly in emerging markets such as Indonesia, Thailand, Vietnam, Cambodia, African Countries..
Some of the companies that hire actuaries in India include Max Bupa Health Insurance, WNS, Towers Watson, PwC Actuarial Services India, Mercer, Directorate of Postal Life Insurance, McKinsey Advanced Healthcare Analytics, E&Y, Milliman, Swiss Re, Future Generali, IDBI etc.
Comment here