Category: 

What does an Actuarial Consultant do?

Article Details
  • Written By: Cassie L. Damewood
  • Edited By: Jenn Walker
  • Last Modified Date: 08 November 2016
  • Copyright Protected:
    2003-2016
    Conjecture Corporation
  • Print this Article
Free Widgets for your Site/Blog
Although they mainly functioned as downspouts, gargoyles were also intended to scare people into attending church.  more...

December 3 ,  1989 :  The Cold War officially ended.  more...

An actuarial consultant helps businesses and government agencies increase profits by analyzing their current financial conditions and making recommendations for future fiscal decisions and actions. The consultant may work for a financial consulting firm or as an independent contractor. She commonly works alone during the analytical period and regularly confers with colleagues to develop solutions.

What distinguishes an actuarial approach from those used by other finance professionals is that it is cyclical. The traditional approach is to identify a problem and present a solution. An actuarial consultant’s methodology, often called a control cycle, consists of problem identification, the application of a solution, observation of results and then starting over if the desired results are not achieved. This approach embraces the concept, at least philosophically, that no problem is unsolvable.

This approach is commonly associated with the examination of a company’s insurance and pension plans. In recent years, however, actuarial consultants have applied it to other areas, such as investments and risk management. All scenarios typically require regular reviews by the consultant to monitor progress and revise less successful approaches.

When a business experiences dwindling profits, its managers and owners are frequently unclear on the reasons. An actuarial consultant is often called in to examine all financial records. She usually focuses on the statistical aspects of finances and investments, an area often overlooked by a company’s business or finance manager.

Ad

The consultant normally examines insurance and pension plan expenditures first because these costs are the easiest to analyze statistically. By studying the risk and probability factors of these plans, she can normally recommend cost savings that will not significantly impact the benefits. Her proposal may include increasing employee contributions or extending the length of employment required for pension plans to activate.

These systematic examination techniques are customarily applied by the actuarial consultant to other areas of a company’s finances as well. She is commonly expected to examine the firm’s current investments, acquisitions, mergers and related expenditures. Her suggestions normally include risk management strategies as well as simple ways to cut costs. These plans may involve actions that can be immediately activated or integrated over a period of time.

Educational requirements for this position vary. The majority of employers normally require a bachelor’s degree in mathematics, statistics or statistical analysis. Postgraduate studies in a related field may be required for some actuarial consultant jobs. In addition to formal education, a number of jobs require certification from an accredited actuarial licensing institution.

Ad

You might also Like

Recommended

Discuss this Article

Post your comments

Post Anonymously

Login

username
password
forgot password?

Register

username
password
confirm
email