Actuarial science is a branch of science that refers to mathematical and statistical processes to examine risk in insurance, finance, and other industries and professions. It includes complimentary subjects such as mathematics, probability theory, statistics, finance, economics, and computer science. Actuarial science has gone through many revolutionary modifications due to the expansion of high-speed computers and the union of stochastic actuarial models with modern financial theory.
Calculations were performed without computers in the 18th and 19th centuries. The provisions for reserving the calculations of life insurance premiums are complex. Actuaries formulated methods to make the calculations as simple and easy as possible. Actuarial organizations were established to support and protect the community interest by facilitating competency and moral standards. Though calculations remained unmanageable and actuarial shortcuts were banality. During the 20th century, non-life actuaries interpreted the footsteps of their life insurance partners. 1920 improvements for the New-York based national council on workmen's Reimbursements Insurance rates took over 2 months. The mathematical organizations for stochastic methods were formed in the 1930s and 1940s. Now, actuaries could estimate penalties using models of random events. The development of computers revolutionized actuarial science.
Role of actuaries:
Actuaries play many roles in a wide extent of domains that involve insurance companies, health organizations, pension plans, risk management, government, regulatory regimes, and also other areas.
They have listed knowledge and awareness of monetary, economic, demographic, and insurance risks and mastery in:
Actuaries also give guidance and information on the adequacy of risk assessment, reinsurance agreements, investment policies, equity levels, and stress testing of the future and the economic situation of an economic institution.
One of the key abilities of an actuary is the improvement and application of models to enable to solve complicated monetary issues. This mastery is now being applied successfully in many regions of the industry beyond the economic domain. Actuaries add quality to the raw output of a software model by using their professional assessment to assess and elucidate the practical significance of the outcomes and the restrictions of the model.
The roles that actuaries play are likely to differ over the period of time, by nation, exercise area,
connection to the economic organization, corporate pattern, and civilization. The appendix identifies roles presently undertaken by actuaries and apexes areas where actuaries could play a more important role in the fortune.
A career in Actuarial Science:
Actuarial science is slowly progressing and gaining popularity in India. There is a great demand for actuaries in India as well as in other countries. In order to be actuary, you are supposed to have a good knowledge of financial, demographic, insurance risks, and should be an expert in formulating and using statistical and economic models. Actuaries must know all about pricing, governing the number of liabilities, and setting equity regulations for risky future events.
There are very good options in the coming future for those who seek their career in actuarial science such as in general insurance companies, health insurance companies, actuarial consulting companies as well as actuarial back offices (for example WNS, Mercer, etc).
In India, there are many firms that offer the job to actuaries such as Max Bupa Health Insurance, WNS, Towers Watson, PwC Actuarial Services India, Mercer, Directorate of Postal Life Insurance, McKinsey Advanced Healthcare Analytics, E&Y, Milliman, etc.
Exams and courses:
The growth of the Indian economy and abrupt industry expansion has improved and increased the regulation of skilled individuals who comprehend actuarial science and are decent at indicating trends. Although the popularity of actuarial courses has evolved over a period of time, there are several universities and institutes that offer these programs.
There are some b-schools that provide MBA or PGDM in actuarial sciences, though, candidates often seek MBA in finance to invade this career. India also provides a traditional actuarial course that is given by the Institute of Actuaries of India (IAI).
Actuarial Course offered by IAI:
The Institute of Actuaries of India (IAI) administers its own entrance exam i.e. Actuarial Common Entrance Test (ACET) to shortlist candidates for the actuarial course provided by it. The institute has formally changed the pattern of the ACET exam.
Candidates can access sample papers and books on the official website of IAI once they have enrolled for the exam.
According to the new pattern, the ACET exam is administered thrice every year and wishing candidates can enroll for the exam within the deadline of the respective positions. The first exam is executed around April, the second round in June and the third round is conducted in December every year.
Duration: 3 hours, single slot
Total Marks: 100
Number of Questions
45 Questions – 1 mark each
20 Questions – 2 marks each
5 Questions – 3 marks each
Sections in the Exam
Section 1: Mathematics, Data Interpretation, and Statistics having 55% of weightage
Section 2: English and Logical Reasoning
Weightage of the Sections
Section 1 – 55% weightage
Section 2 – 45% weightage
24 ( Mumbai, Delhi, Indore, Kolkata, Nagpur, Bangalore, Ranchi, Gurgaon, Kochi, Chennai, Bhubaneswar, Pune, Dehradun, Hyderabad, Patna, Raipur, Vizag, Jaipur, Coimbatore, Ahmedabad, Baroda, Lucknow, Guwahati, and Chandigarh)
Syllabus of ACET for Actuarial Course:
Considerably, the ACET exam wraps five subjects, and questions differ in context. You can have the syllabus details of ACET and the sub-topics on the official website of IAI. Below mentioned are the subjects where the questions are asked in the exam. IAI has broadcasted the time table for the June 2020 exam. IAI is the council that conducts (ACET) to provide admissions to actuary courses:
Eligibility Criteria for Actuarial Courses:
Bachelor Degree and ACET:
You can apply for the ACET exam by the IAI after completing class 12, though, the institute requires aspirants enrolled in higher education particularly in the mathematics field to apply for the course.
Furthermore, for bachelor's degree courses, you will be expected to pass at least class 12. Admissions are accomplished on the basis of merit.
Master Degree and PG Diploma:
You can apply for MBA and M.Sc. courses in this career after passing graduation with a minimum of 60% marks.
Admission in PG Diploma and MBA courses are accomplished on the basis of MBA entrance exams like CAT, CMAT, MAT.
Jobs and Salary after Seeking Actuarial Sciences:
Career chances after seeking these courses are extremely bright as actuarial science is a very sophisticated area of finance and economy. Aspirants who have pursued the course from IAI get lucrative proposals from MNCs and are frequently invited by the Government to serve with them. Following are some of the respected corporations that hire actuaries:
Top colleges and institutes that offer actuarial science courses:
Job and Salary:
IAI qualified and certified experts can expect a salary package of up to Rs. 30 lakh annually and more relying on the type of offers and nation that is offering them jobs.
MBAs can also scratch packages varying from Rs. 6 to Rs. 12 lakh annually depending on ability, knowledge, and the colleges they are graduating from. Some of the top MBA colleges in India offer good job opportunities in this area. Admissions to top MBA colleges are accomplished on the basis of entrance exams.