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Actuarial trainees begin to complete basic tasks related to actuarial work as preparation for greater roles in a company or business. Actuaries are professionals who work with the valuation of risk. These individuals specialize in mathematics relating to liabilities or risks. They collect and analyze data to interpret what numbers mean in relation to risks for a given business or industry. This role is critical in the insurance field, or any related field, in protecting companies from losses related to extremely complex valuations.
In the field of actuarial accounting, actuarial trainees are beginners. They may assist in preparing critical paperwork that helps to chart the future course of a business, or establish its appetite for risk, payouts to insurance clients, or other events. Actuarial trainees might also work on any stage of an “actuarial project,” from collecting data, to filing reports, or even presenting results to an external department. Sometimes, this may require extensive meetings with diverse staff groups beyond the actuarial office.
One area that actuarial trainees might likely get involved in is in the process of “ratemaking.” Ratemaking is the idea of calculating risks and other aspects of an insurance environment to come up with appropriate rates of payment for policy premiums or other required payments by policy holders. In ratemaking, the actuary must make sure that the rates will be sufficient to cover all liabilities, so as not to lose money on policies. Ratemaking must also contemplate the market and avoid overcharging, which can hurt a company as well if its products are not competitively valued.
Another main aspect of actuarial work that an actuarial trainee often encounters is reserving or dealing with actuarial reserves. Actuarial reserves are liability calculations. In many cases, insurers must keep assets or holdings to balance out the total liabilities assessed in actuarial reserve calculations.
Different nations have their own laws and regulations on insurance, and actuarial trainees must understand these in order to be able to provide professional assistance to firms or business clients. Actuarial trainees must know about the greater context for their field in the country in which they work. An actuarial trainee can succeed by applying all of their prior training to practical real-world actuarial tasks, like those mentioned above, keeping in mind any national or local law that will shape the way that actuaries work in a given locale.