Actuary

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An actuary plays a large role in the cost of your auto insurance policy. Actuaries are financial professionals who specialize in the areas of risk and uncertainty. They provide your insurer with expert advice and insight into the assessment of all their financial products and focus on understanding the complexity of insured risk through mathematical modeling and the mechanisms of those models.actuary

The main role of an actuary is to calculate the likelihood of specific events covered under your auto insurance policy. They work out the contingencies based on the outcomes of those events and work to minimize losses for your insurer and to make your policy valuation as fair as possible for you. Actuaries do not influence the risks of your policy, but they deliver understanding of how those risks apply to people who are similar to you. For example the risks associated with young drivers under the age of 25, are considerably different to the risks faced by senior drivers over the age of 75.

An actuary understands these differences and enables your premiums to be calculated based on the risks to your category of driver and not for every driver.

The actuarial profession is considered to be one of the most prestigious and desirable in the world, and regularly features in surveys and opinion polls as one of the best jobs in the United States.

What qualifications do actuaries need?

Not everyone can become an actuary and there are stringent professional standards for actuaries who work in the auto insurance industry in the US. Every actuary must be a member of either the Society of Actuaries or the Casualty Actuarial Society and in addition to be able to sign statements of opinion they must also be a member of the American Academy of Actuaries.

This means that each actuary must pass over a dozen professional examinations and also hold three years’ experience of delivering actual actuarial work. The actuary’s study is never finished either and there is a commitment to ongoing study.

What does this mean to me?

It means that whenever you are asked to pay a premium for your auto insurance in the US, you can be assured that a highly qualified professional actuary has spent time understanding the risks to you and ensuring that your premiums are a fair reflection of the actual risks that drivers who are similar to you face every day.

Additional Definition For Actuary

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