June 29, 2022

A Career in Actuarial Science: No Risk!

Actuarial Science deals with analyzing the financial risk of a business operation. This business operation can be an insurance policy or an investment or an uncertain event that might cause financial harm to the company. 

To put this in simple words, how a business or individual can retain and grow their capital by using mathematical tools to predict future trends by using data from the past. 

Traditionally Actuarial science is concerned with mortality and production of life and the application of compound interest. Actuarial science course deals with various subjects like mathematics, probability, finance, economics, statistics, and computer science.

 Actuaries or actuarial scientists help organizations and individuals by calculating financial risks. How? Let’s understand. 

Assume you have own an health insurance company. How would you frame your policy? Would you take the same amount of premium from everyone? Let’s say you do. Your taking the same amount of money from all age groups. But eventually you get a lot of insurance claims from the older demographic of your policy holders who have to go through extremely expensive procedures. But you get no claims from the teenager demographic of your policy holders. Before you know it, you’ve used the money which everyone paid and now you have nothing for yourself.

That doesn’t sound like a very successful business plan does it? 

This is where actuaries come in. An actuary will come in and collect data about the people that live around you and analyze their lifestyles, habits, common health problems, and so on. Now, they’ll help you frame different sets of policies for different groups of people. This way, not only will all your policy holders stay happy and tension-free, but you will generate profits that help your company grow. 

Now, the actuary will use this data to help you set up a plan that will maintain the smooth functioning of your company, regular payouts, profits, and an emergency fund that will keep your company running in the event of a totally unpredictable event. 

But how does one actuary build a plan that keeps a multi-million dollar company afloat? 

Data. While time travel is yet to be discovered, it is an actuary’s duty to know the future. They have to constantly analyse everything that could affect your company and build an efficient strategy that helps you save your capital.

Actuaries look into the past data and predict the future for you. It includes how much money should be kept aside to cover the financial losses and the number of failures that may occur in the future. With the rapid economic growth that our company is growing through, the amount of capital that companies will increase rapidly and so will the need to minimize risk. This will result in the growth in the demand for actuarial science in India. 

Becoming an actuary in India:

The Institute of Actuaries of India(IAI) is the governing body of aspiring actuarial science professionals in India. IAI is a statutory body established under the Actuaries act of 2006, which regulates the profession of Actuaries in India. The Actuarial Institute in India provides certification to aspiring actuaries. This course is offered by a lot of colleges in India. Let’s understand the basic requirements to build a career in actuarial sciences after 12th

1. For UG courses

  • The candidate must have appeared in 10+2 examinations for the Commerce/Maths stream.
  • English is a mandatory subject
  • A minimum aggregate of 60% in 10+2  and a minimum 70% aggregate in Maths.

2. For PG courses

  • Candidates must have passed B.Sc./B.Com with 50% aggregate marks.
  • Candidates must have Maths and Statistics as core subjects

Course Subjects:

B.Sc. in Actuarial Science is a 3-year long Bachelor’s program. It has the following subjects in its 6 semesters. The syllabus may vary from institute to institute, but here’s an overview of the subjects you will study in this program:

  • Calculus
  • Statistics and Probability
  • Mathematical Functions
  • Actuarial accounting
  • Foreign economics
  • Actuarial economics
  • General Insurance
  • Mathematics
  • Liability insurance
  • Business research

Following are some colleges that are renowned for their actuarial science courses. 

How does an Actuary build a career in India?

India is in the phase of being an economic superpower. With thousands of startups emerging each year, the jobs of actuaries have come in demand. While the titles of the job may differ in various companies, a lot of organizations are always on the lookout to build a strong financial team for themselves. 

Following are some of the top recruiters in the Actuarial Science sector:  

  • Prudential
  • Max Bupa Health Insurance
  • E&Y
  • PwC Actuarial Services India
  • Liberty Mutual
  • The Travelers
  • Towers Watson
  • The Hartford
  • ING
  • Allstate
  • Nationwide
  • Towers Watson
  • Aon Hewitt

Some of you have probably heard these names and have heard that these companies offer massive packages to their employees. While that may be true, the job of an actuary is a tough one. An individual needs to focus on data each and every day and find loopholes or evidence in that data to build a strategy again and again. An individual needs to have a cautious eye, a serious passion for numbers, and a brain made for mathematics to build a lifelong career in actuarial sciences in India.  

Actuarial Science is in demand right now. Any student that has pursued commerce, should consider this once. It has a high potential to be one of the leading careers in this decade.

At Dheya, we believe that an individual has the potential to build the career of their dreams, but to achieve that dream, you need to be prepared in every perspective. That is why we at Dheya help students realise their true potential, and connect them with a mentor who prepares them to build a career that has no limits. 

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