Much of life is uncertain. It involves risk, such as risk of sickness, disability, unemployment, property damage or loss or dying unexpectedly. Although these risks are unpredictable for any one individual, actuaries can analyze statistics and calculate the probability of uncertain events occurring in the future among members of defined groups. With that information, they can help design programs to mitigate risks.
In insurance companies, actuaries are involved in almost every aspect of the business including:
- developing new products and services
- setting premiums
- monitoring profitability
- valuating appropriate reserve levels
- management and administration.
In other settings, actuaries may provide a wide variety of services. For example, they may:
- help employers, labour unions and trustees design, fund and administer private pension plans and other employee benefit plans
- specialize in the probabilities of loss arising from events such as sickness, disability and casualties caused by fire, theft, windstorm or automobile accident
- appear as expert witnesses in court proceedings on issues such as lost future earnings
- help investment fund managers optimize their returns based on the nature of benefit liabilities and an organization's risk tolerances
- improve medical insurance plans by showing the long term savings possible through alternative treatments or the introduction of new drugs
- advise companies on how to set up trust funds to cover anticipated future expenses.
All actuaries must also ensure legislative requirements and filings are met.