Analyzing data, crunching numbers, interpreting statistics.
If these activities give you a rush in the head, and your analytical skills remain unmatched, then Actuarial Science could be your true calling.
Ranked amongst the top 25 professions in the world (survey conducted by U.S News and World Report), Actuarial Science as a field is all about analysis, computation, logic and data. From designing insurance policies to solving business problems, Actuaries are in demand in any field where risk is involved.
The following article is focused on understanding who Actuaries are, what they do, what you need to do to enter this field and its scope in India. Wish to know more about this exciting career? Read on.
Who are Actuaries and What Do They Do?
Numbers are actuaries’ best friends. They analyze different types of data to calculate and manage risk. They, thus, help companies form efficient policies by protecting themselves from uncertain and undesirable future events. Actuaries are required in any field where risk is involved, including banking, insurance, healthcare, and even non-financial areas.
Their ability to analyze data to understand risk makes them especially useful in the field of Insurance. Actuaries are the masterminds behind insurance policies. They analyze facts, figures, and trends to formulate various insurance programs.
The typical work responsibilities of Actuaries include the following:
- Designing financial policies and monitoring if there are enough funds in the company.
- Determining the rate of interest to be given to customers for insurance policies.
- Keeping a check on insurance risks to minimize losses.
- Predicting the occurrence of various illnesses such as heart disease, cancer, etc., among different groups, to incorporate these risks when designing insurance policies.
- Assessing risk for the financial planning of the company.
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How to become an Actuary?
Now that you know more about Actuaries and the work they do, let’s take a look at what you need to do to pursue a career in this field.
Here are the steps to become an Actuary in India:
- Take up Commerce with Maths or PCM after class 10th.
- Pursue your graduation in Maths, Statistics, B.Com or Actuarial Science.
- Take the Actuarial Common Entrance Test (ACET).
- Clear Actuarial Science Stages (15 in total)
Now let’s talk about each of them in detail.
Step 1 – Take up Commerce with Mathematics or PCM after Class 10th
Actuarial Science as a field is all about data, numbers and statistics. Thus, it is very important to have a strong hold on Mathematics and Statistics to make a successful career in it. Commerce with Mathematics or Science with Mathematics (PCM) are recommended streams you should take up in Class 11th and 12th.
Step 2 – Pursue your Graduation in Mathematics, Statistics or Actuarial Science
There is no specific eligibility requirement for graduation, but B.Sc Mathematics and B.Sc Statistics are recommended courses. They will allow you to form a strong base in mathematics, probability concepts, analytical and problem-solving skills, and statistics, which all form the foundations of Actuarial Science.
There are other courses as well, ones that allow you to work in this field directly, including B.Sc. (Actuarial Science) and M.Sc (Actuarial Science). You can start working directly after these courses; however, it is still wise to clear Actuarial Science levels too. I will talk about the levels in the upcoming sections.
Some Top Colleges for Mathematics and Statistics:
- Indian Statistical Institute (ISI), Kolkata
- Indian Institute of Science (IISc), Bangalore
- Chennai Mathematical Institute, Chennai
- National Institute of Science Education and Research, Bhubaneshwar
- Tata Institute of Fundamental Research (TIFR), Mumbai
- Delhi University (Various Colleges)
- University of Madras, Chennai
- Xavier’s College, Mumbai & Kolkata
- Fergusson College, Pune
- Indian Agricultural Statistics Research Institute (IASRI), New Delhi
- University of Mumbai, Mumbai
- Presidency University, Kolkata
Some Top Colleges for Actuarial Science Courses:
- Christ University, Bengaluru (M.Sc Actuarial Science)
- Bishop Heber College, Tiruchirappalli (B.Sc. Actuarial Mathematics Science)
- Babu Banarasi Das University, Lucknow (B.Sc Actuarial Science)
- Mahatma Gandhi University, Kerala (M.Sc Actuarial Science)
- Institute of Endurance and Risk Management (Post-Graduate Diploma Health Insurance)
Step 3 – Take the Actuarial Common Entrance test
The first step to becoming a member of the Institute of Actuaries of India (IAI) and becoming a practising Actuary is to clear their entrance exam – Actuarial Common Entrance Test (ACET). You can appear for the entrance just after your class 12th or even if you are a graduate/postgraduate. ACET is a 100 marks test and is conducted online. The test, lasting 3 hours, is divided into 2 sections:
Section 1 includes Mathematics, Statistics and Data Interpretation.
Section 2 includes English and Logical Reasoning.
Exemptions from the ACET Exam
You can be allowed to skip the ACET exam in a few cases.
The Institute of Actuaries of India (IAI) has a mutual agreement with a few international actuarial bodies that allows students who have passed at least 3 subjects from these bodies, to skip the ACET exam altogether. These bodies include The Institute and Faculty of Actuaries (IFoA), UK; Casualty Actuarial Society and The Institute of Actuaries of Australia. Students in India prefer to apply for the IFoA as the papers offered are relatively easy, although the minimum pass percentage and the cost for taking exams are much higher.
Step 4 – Clear Actuarial Science Stages
Since Actuarial Science is a professional course, you are required to clear different examinations/stages to pursue this field. These are written as well as practical exams conducted by the IAI.
There are no regular colleges or classes for this course, only examinations that you are required to clear. The IAI provides the reference study material for them.
There are a total of 15 papers divided into 4 stages:
- Stage 1: Core Technical (CT)
- Stage 2: Core Application (CA)
- Stage 3: Specialist Technical (ST)
- Stage 4: Specialist Application (SA)
You get to choose your subjects/papers from these 4 stages. You are required to clear all the papers (9 in total) from Core Technical, all 3 papers from Core Application, any 2 (out of 8) from Specialist Technical (ST) and any 1 (out of 6) from Specialist Application.
Once you clear the first two stages, you are termed an Associate with the IAI. On clearing all 4 stages, and acquiring 3 years of experience, you become a Fellow. As a fellow, you can pursue further studies and research in the field.
However, clearing 5 papers is enough to fetch you a job as an Actuary. There is no defined timeframe to clear the exams, and you can complete them at your own pace.
Scope and Career Opportunities for Actuaries
Actuarial Science is one of the most popular courses among those who have a knack for numbers, statistics and data. It is a field with immense scope if you have the right set of skills and analytical abilities. According to the IAI, there are only 9182 students, 160 associates, and 344 fellows in India. The demand for qualified Actuaries is much higher than their supply and hence, the average salary in this field is quite high.
You can work in multiple areas in both private and government sectors. Within the field of insurance, you can work in different areas, such as health insurance, vehicle insurance, life insurance, employee retirement and benefit plans, general insurance, etc. In the life and health insurance fields you will get to help companies in developing health and long-term insurance policies. Besides insurance companies, you can work in Pension and Benefits firms.
You can also hold managerial roles in the domain of actuarial science. An MBA in Insurance or Actuarial Science will give you the expertise to manage insurance and risk projects and ensure their smooth functioning.
You can even work as a consultant and advice companies in multiple areas such as life insurance, taxation, employee benefits, risk management, investment, etc.
Should You Pursue a Career in Actuarial Science?
Actuarial Science is not an easy route to follow, and the process of becoming an Actuary is long. So before you take the leap into this career, you should check whether you possess certain important skills or not.
You Should Pursue this Career if:
- You are able to work with numbers efficiently.
- You have a strong hold on calculus, statistics and probability concepts.
- You have strong analytical skills.
- You are comfortable dealing with huge amounts of data.
- You can work for long durations at a stretch.
Hence, if you are crazy about analysis and logic and possess the skills mentioned above, you should consider exploring this field.
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