Actuaries in a P&C company

I have just started out in a P&C company, my role is on a small subset of the Personal side. i realize that most of the upper management is not from actuarial background, most of them are from operation/underwriting background.

I have a few friends from life company and they told me majority of their top managements have actuarial background (most of them qualified).

This makes me wonder - seems like actuaries is not that “important” in a P&C company and generally the top spot are “reserve” to those from other division. Any thoughts on this my fellow GoActuary-er?

This can vary significantly from company to company.

There are P&C companies out there where you can find folks in management roles, including not-traditionally-actuarial positions, with actuarial credentials.

The largest P&C company in Canada, has an ACAS as a CEO and a significant portion of the senior management team at that company has actuarial credentials.

Getting an ACAS or an FCAS is not a guaranteed ride on an up-escalator through the corporate ranks. However, the skills we pick up as actuaries are useful in combination with other skills some folks develop to helping some motivated individuals to climb the totem pole. Frequently, the credentialed actuaries in senior roles achieved those senior roles for non-actuarial reasons.

That is easier to do at some companies than others, due to differences in company cultures and the nature of networking. I’ve seen some companies that were “run by actuaries”, others “run by underwriters”, and others that were “run by finance guys”. Those descriptions all suffer as overgeneralizations, but they do hint at the cultural/networking aspect of the phenomenon.

Most of the above is written from a North American P&C insurer perspective. Certainly things can be and are different for other kinds of companies employing P&C actuaries. I don’t have enough experience looking at life/health/etc. carriers or abroad to have an informed opinion on the extent to which my above comments would apply…but I suspect that what I’ve described is more common than not.

Ditto.

There are several actuaries high in senior management where i work. Except for the chief actuary, none is working on an actuarial role. But their actuarial background helps them run stuff.

There are also lots of non-actuaries in senior management roles.

I don’t think the top spots are reserved for people from any particular background. But I’m sure that varies by company.

In your opinion, what skills do they commonly other than the actuarial knowledge? I have actually heard of quite a few qualified actuaries that switch to underwriting role, and I think it is quite uncommon for actuaries to switch to other roles apart from underwriting. I guess actuarial plus underwriting knowledge should be enough to prepare one for more senior role in PC insurer.

How does actuarial background help them run stuff ?
I think actuaries in general is smarter and have superior logical thinking than the rest, this is what makes them stand apart from others.

I guess not many actuaries are motivated/interested enough to be in more senior roles, else we will see far more actuaries in senior management role.

There are lots of actuaries in senior management roles in P&C Companies. Like Maphisto said, this can vary wildly from company to company based on culture.

An actuarial designation won’t get you there by itself in any carrier. Leadership skills, business acumen, people skills, and being knowledgeable about other business disciplines can take you far if you have the ability and interest

The answer will depend on the roles that you’re looking at. I’ve seen actuaries transition to underwriting, claims, finance and investment, product management, operations. I’m working in risk management.

All of these roles can have an “actuarial” element to them. In some cases the overlap is obvious, but in others…the operations position, for example (the actuary I’m thinking of oversees the folks who do billing, get policies assembled and electronically delivered to the agents and brokers, etc., etc.), the skills picked up through standard actuarial rotations come in handy in thinking about how to analyze performance of the different teams and to look for areas that need improvement.

For actuaries working in carrier settings early in their careers, probably the best thing you can do is try to learn more about the business in general – what goes on outside your cube. While my experience was a little abnormal, one of the things I became thankful for in my first job was how my training included spending a few days shadowing line underwriters and claim folks. Hell, I spent a couple of days working in the mail room and cutting checks after a local disaster. By doing those things, I gained a greater appreciation for how the company really functioned beyond the rate filings that were my primary duty.

The folks who move into more senior positions, both actuarial and non-actuarial, usually have some additional “people skills” and “management skills” beyond the training that actuarial students normally get through the exam process. Look for opportunities to develop those, if climbing the corporate ladder is your goal.

Something you might consider doing, if you haven’t already done so, is looking for a mentor. Some companies have mentorship programs of varying degrees of formality; at others you might have to find one on your own (perhaps asking a boss or grand-boss for an introduction). A good mentor can help answer these kinds of questions within the context of your employer, suggest people for you to meet, and provide someone to talk to who might help you see “the big picture” a little better, at least from the perspective of where you might want your career to go.

sorry i am a little confused here. you said there is a lot of actuaries in P&C in general or this vary wildly from company to company ? if it is the latter then there are some P&C insurers which don’t have lots of actuaries in top post…

I’ve also seen actuaries transition to HR and marketing.

And I second all of this.

Actuaries learn a lot about how insurance companies work to earn their FCAS. They have to learn stuff about law, regulation, claims, and accounting, for instance. They often work in a variety of parts of the company and meet and work with employees in a wide variety of other roles. The broad insurance knowledge combined with strong analytical skills is quite powerful, especially in the hands of a person with good people skills and management ability.

Lots of actuaries don’t have those last two, and those ones will not rise to the top. And that’s okay, there are lots of good jobs for actuaries that aren’t c-suite. I decided years ago that I didn’t want to rise too high in my firm. I wanted more “life” in the work/life balance. And really, to be an effective executive, it’s generally helpful to throw yourself all-in to your career.

1 Like

It varies a lot. I think one of the big firms, maybe progressive, basically doesn’t have actuaries. They hire statisticians and other types of analysts, instead.

Progressive has some actuaries, but not to the extent that some other large companies do.

I swear, at my third and fifth employers, pre-pandemic, you could not walk more than a few feet in the main offices without bumping into an actuary or actuarial student. (Literally bumping; it’s hard to avoid doing so when so many of us just look down at our shoes! :smiley: )

Are there any companies run by claims adjusters?

hmm not too convinced. they gotta have a qualified actuary to sign off the reserve, hard to imagine they outsource this given the size of progressive

bet you don’t mingle around with people from other division… hey aren’t you a typical actuary :laughing::laughing:

mm i guess people skill and management skill can be developed to a certain extent.

your last paragraph prove that some actuaries lack the motivation to move to higher rung, not a lack of ability.

Of course. Lots of people, in every job category, lack the motivation to move up the ladder. I think it’s wise to decide how high you want to climb, and aim for that.

I have no idea what Progressive does w.r.t its appointed actuary. However I will say that there are benefits to having the SAO signed by a consultant, regardless of the company’s size.

1 Like

I think (almost?) all companies are run by CEOs.

I wouldn’t be surprised to learn that some of those CEOs for insurers were ex-claims adjusters

That second one wuz what I was asking. Usually I see:

  • Underwriter
  • Actuary
  • Management consultant
  • Rich dude or board member with no insurance experience

but no claims adjuster yet

I think the most obvious answer to your question is just a sample size issue. There are A LOT more underwriters than actuaries.

In terms of relative need by actuarial practice, I imagine this could be hotly debated, but I’d argue P&C values actuaries at least as highly as the other practices because of the business model. Auto insurance being a great example. Whether or not an insurance company makes money on auto insurance is significantly driven by how sophisticated the actuarial pricing is because the time from premium paid to losses paid is so short.

The opposite is life insurance, where the premium is paid in over time and most/much of the value created is from the benefit of the company being able to hold onto that money for so long such that they earn significant investment returns.