The Actuary October 2014

OCTOBER 2014 theactuary.com

Interview: Steve Groves

The magazine of the actuarial profession

Considers radical reforms to the UK pensions market

Pensions Reinsurer capacity for longevity swaps

Soft skills

The Actuary

NEW ROUTES TO MARKET

Written and digital communication for business

Careers An actuary as non-executive director

The beneďŹ ts and challenges of bank and insurer collaboration

October 2014

p01_oct_cover.indd 1

23/09/2014 16:48

Appointments

What’s underneath?

We look below the surface to spot trends early and show you what is really happening. Whether your need relates to risk management, capital, or strategy, our cutting-edge analysis techniques can help you see deeper than the competition.

Get new insights on your business at uk.milliman.com.

2

THE ACTUARY • May 2013 www.theactuary.com

p02_ACT.10.14.indd 2

19/09/2014 15:30

OCTOBER 2014

Contents

18

24

Many insurers remain at a relatively early stage of evaluating different routes to market... for most, using a third-party asset manager will remain the most viable option

22

UP FRONT 9

SIAS events

10 IFoA news 14 People/society news 16 General insurance news 17 Industry news

OPINION 5

Editorial Kelvin Chamunorwa looks back on the year so far, and considers future prospects for actuaries

6

Letters Actuaries’ concerns on more data, liberalisation and the Financial Ombudsman

7

President’s comment Nick Salter on sharing actuarial knowledge and practice

8

Soapbox Managing an integrated approach to pension risk is vital, says Stephen Soper

MORE CONTENT ONLINE Additional content can be found at www.theactuary.com

COVER: JAMES DAWE

p03_Oct_contents.indd 3

FEATURES

AT THE BACK

18 Interview: Steve Groves

33 Books

In light of the UK pension reforms, Jonathan Lim speaks to Steve Groves about the impact on the annuity market and future trends

22 Soft skills: Reporting for duty Natalie Canavor explains why good business communication depends on knowing your goals and your audience

24 Finance: New routes to market Alec Innes, Albert Shamash, Stephen Birch and Ross Evans explore the benefits of bank and insurer collaboration

Rani Pooran and Sonal Shah review Seeing What Others Don’t: The Remarkable Ways We Gain Insights by Gary Klein

34 Puzzles Try the latest cryptic crossword and Mensa puzzles

37 Student Jessica Elkin offers words of encouragement to students dealing with unsuccessful exam results

38 Actuary of the future Craig Moran of First Actuarial

28 Careers: Actuary on board Colin Czapiewski covers some practical issues faced by non-executive directors in a changing boardroom environment

30 Pensions: The tipping point Have longevity swap transactions reached their capacity? Martin Lockwood finds out

32 Spotlight: Worshipful Company of Actuaries Bill Smith highlights the work of the WCA and summarises some of its key initiatives

ONLINE Review: Women in Energy conference Tracey Zalk asks whether glass ceilings are a self-fulfilling prophecy

Book Review: Seeing What Others Don’t: The Remarkable Ways We Gain Insights by Gary Klein.

An unabridged review by Rani Pooran and Sonal Shah

WRITERS OF THE MONTH Colin Czapiewski wins a £50 book token for his feature on non-executive directorship courtesy of SIAS

October 2014 • THE ACTUARY 3 www.theactuary.com

23/09/2014 16:49

Appointments

Business Critical As a self-respecting actuarial professional, you’ll no doubt want to keep up with the latest industry developments, people and society updates and professional news.

But you’re also busy being an actuarial professional. Right?

That’s why The Actuary’s weekly email alert brings you a handy round-up of only the most relevant news stories and comment, straight to your inbox, every Thursday.

Sign up for weekly news alerts today Visit www.theactuary.com/email-sign-up 2

THE ACTUARY • May 2013 www.theactuary.com

p04_ACT.10.14.indd 2

23/09/2014 10:43

Opinion Editorial theactuary.com

Publisher Redactive Media Group 17-18 Britton Street, London EC1M 5TP +44 (0)20 7880 6200 Publishing director Joanna Marsh Sub-editors Kathryn Manning Caroline Taylor News editor Vivienne Russell +44 (0)20 7324 2788 vivienne.russell@redactive.co.uk News reporter Judith Ugwumadu +44 (0)20 7324 2794 judith@redactive.co.uk Editorial assistant Tania Forrester tania.forrester@redactive.co.uk Sales manager James Condley +44 (0)20 7324 2750 james.condley@redactive.co.uk Display sales executive Vlad Harmanescu +44 (0)20 7324 2726 vlad@redactive.co.uk Senior recruitment sales executive Emmanuel Nettey +44 (0)20 7880 6234 emmanuel.nettey@redactive.co.uk Senior designer Gene Cornelius Picture editor Akin Falope Production executive Rachel Young +44 (0)20 7880 6209 rachel.young@redactive.co.uk

editor@theactuary.com

Internet The Actuary: www.theactuary.com Staple Inn Actuarial Society: www.sias.org.uk Institute and Faculty of Actuaries: www.actuaries.org.uk Managing editor Sharon Maguire +44 (0)20 7880 6246 sharon.maguire@redactive.co.uk Editor Kelvin Chamunorwa editor@theactuary.com Features editors Jeremy Lee, pensions, investment, ERM, banking Richard Purcell, life, health and care Richard Schneider, life, Solvency II, mortality/longevity, modelling and software Helen Lau, GI, reinsurance, environment, careers Contact: features@theactuary.com People/society news editor Yvonne Wan social@theactuary.com Student page editor Jessica Elkin student@theactuary.com Arts page arts@theactuary.com Profession news editor Alison Jiggens +44 (0)20 7632 2172 alison.jiggins@actuaries.org.uk SIAS representative Titas Bakanauskas Editorial advisory panel Peter Tompkins (chairman), Naomi Burger, David Campbell, Matthew Edwards, Martin Lunnon, Sherdin Omar, Richard Purcell, Nick Silver, Andrew Smith

Print Polestar Colchester Circulation 25,331 (July 2013 to June 2014)

Subscriptions For subscriptions from outside the actuarial profession, UK: £90 per annum/£8.50 per copy. Europe: £110 per annum, rest of the world: £130 per annum. Contact: Alison Jiggens, The Institute and Faculty of Actuaries, Staple Inn, High Holborn, London WC1V 7QT. T +44 (0)20 7632 2100 E alison.jiggens@actuaries.org.uk Students on actuarial science courses may join and they will receive The Actuary as part of their membership. Apply to: Membership Department, The Institute and Faculty of Actuaries, Maclaurin House, 18 Dublin Street, Edinburgh EH1 3PP. T +44 (0)131 240 1325 E membership@actuaries.org.uk Changes of address should inform the membership department as above.

For delivery queries, contact: Rachel Young E rachel.young@redactive.co.uk Published by the Staple Inn Actuarial Society The editor, The Institute and Faculty of Actuaries and Staple Inn Actuarial Society are not responsible for the opinions put forward in The Actuary. No part of this publication may be reproduced, stored or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without prior written permission of the copyright owners. While every effort is made to ensure the accuracy of the content, the publisher and its contributors accept no responsibility for any material contained herein.

Important information for contributors to The Actuary By submitting content for publication you confirm that: (a) You (and/or other named contributors) are the sole author(s) of the content submitted; (b) The content you submit is original and has not previously been published (unless you specifically advise us to the contrary); (c) You haven’t previously licensed the use of the content you submit; (d) So far as you are aware, the content submitted will not infringe any third-party rights, be defamatory or in any way illegal.

A time of reflection Kelvin Chamunorwa looks back at the year so far and considers future prospects for actuaries In recent articles in The Actuary, there has been introspective thought into our profession, with some contributors considering how effective actuaries have been in various areas. One such article on predictive modelling generated a lot of debate online. I came across a comment from a risk management professional who was asking why it is that actuaries do not win the lottery every week, showing a misconception of actuaries’ expertise.

There are probably many who share similar sentiments of actuaries more widely. The criticism of actuarial models in the aftermath of the global financial crisis is one example, although it is clear that there were many factors that led to those events.

Since then, there has been increased regulatory and media attention on corporate governance, particularly in the financial sector. In his article, Colin Czapiewski addresses this through the lens of a non-executive director.

He considers how the role has changed over the years and shares practical tips of how actuaries can increase their chances of success in these positions (p28). This is the first article in a three-part series on actuaries on the board, which will run to the end of this year.

What a year it has been in pensions in the UK. In March, the chancellor of the exchequer announced that no one will have to buy an annuity with their retirement savings from next April. In his interview with The Actuary, Steve Groves highlights the impact the new rules have had on the annuity market so far. Groves also discusses the types of products that could be developed for the retirees who will have increased flexibility to draw their retirement funds (p18).

On a personal note, last month was one of celebration as I entered a new decade of life. I could not dwell on the past for too long as my birthday also served as a reminder that there were 100 days left in the year, and still a lot to achieve. Actuaries do not predict the future, but the many opportunities for our profession to make a difference give me reason to be optimistic.

“There has been increased regulatory and media attention on corporate governance”

Kelvin Chamunorwa Editor

© SIAS October 2014 All rights reserved ISSN 0960-457X

LIKE US ON FACEBOOK www.facebook.com/ TheActuaryMagazine

FOLLOW US ON TWITTER @TheActuaryMag @ActuaryEditor

JOIN US ON LINKEDIN www.linkedin.com/groups/Actuarymagazine-UK-Group-3751335

October 2014 • THE ACTUARY www.theactuary.com

p05_Oct_editorial•SEMIFINAL.indd 5

5

23/09/2014 15:43

Opinion Letters to the editor editor@theactuary.com

Ombudsman concerns The Financial Ombudsman Scheme (FOS) has a relatively new database on its website. I believe it is a product of the Lord Hunt report to the FOS for the purpose of “opening up, reaching out and aiming high”. The database provides the Ombudsman’s final decision letters in redacted form, although policyholders are given names such as “Mr T” to protect their identity.

The website has a drop-down menu. This enables a user to select features that interest him or her. For example, they can select cases upheld or cases rejected. A user can also select a keyword such as ‘annuity’ if especially interested in those cases. In my view, two mortgage endowment decision letters call for special comment. These are DRN2059292 and DRN6815673.

DRN2059292 The hurdle rate to achieve the mortgage target was 8.5% and this was for a term of 25 years. We know from the other illustration projection rates, 7% and 10.5%, that the policy must have commenced between 1988 and 1993. Actuaries know from financial forecasting that substantial shortfalls were a real and significant risk, yet the Ombudsman says the endowment was suitable for any investor apart from one who was not prepared to take any risk! With-profits endowments were perceived as low risk and the probability of shortfalls, which was known to be high, was grossly underestimated.

DRN6815673 The main interest in this case is the Ombudsman’s comments on p6. As is their wont, the FOS distinguishes between cases where there has been ‘advice’ and those where the firm merely gave ‘information’. The policyholder is protected through the regulatory complaints procedure if she or he took out an unsuitable policy based on ‘advice’, but much less protection is provided if she or he was only given ‘information’ that did not count as ‘advice’. The Ombudsman says that information which is product-specific is ‘information’, whereas information that is client-specific is ‘advice’.

The moral of this case is that ‘client-specific’ equates to ‘advice’. I would say that information which is specific to the policyholder’s age is ‘client-specific’ and therefore it is ‘advice’. As such, once ‘advice’ has been established, the policyholder is put in an enhanced position to succeed as a complainant.

I find these cases, combined with freedom of information requests, a most valuable source of establishing FOS idiosyncrasies.

Anthony Pepper, 13 September

MORE LETTERS ONLINE More letters are available online at www.theactuary.com/opinion

6

THE ACTUARY • October 2014 www.theactuary.com

p06_oct_letters•SEMIFINAL.indd 6

Dangers of more data In response to the article “The predictive power of data” (The Actuary, August 2014), there is an old saying: “a little knowledge is a dangerous thing”.

All too often, there is a focus on drawing inferences from data without understanding firstly the objective of the exercise, the nature of the data available, the suitability of the data for what one wishes to measure and, more

importantly, what is missing from the data available and how to interpret the results of the data analysis.

I welcome ‘big data’ but have serious concerns about whether it will lead to genuine Eureka moments or whether the focus on data will become a false idol that detracts from comprehensive analysis and leads to misplaced confidence and a riskier world.

Paul Waterhouse, 9 September

Pension liberalisation Danny Quant’s letter, ‘Reputation damage’ (The Actuary, August 2014), gave a cogent warning of the dangers of George Osborne’s pensions ‘liberalisation’ plans. There are

echoes of the 1980s when so many members of good final salary schemes were persuaded to transfer to inferior personal pensions.

Chris Grey, 20 August

The editor welcomes readers’ letters but reserves the right to edit them for publication. Please email editor@theactuary.com.

The deadline for receiving letters for the November issue is 17 October 2014.

GETTY

23/09/2014 15:44

›

Opinion President’s comment

Nick Salter is the president of the Institute and Faculty of Actuaries

NICK SALTER

Big plans in a small world The world is getting smaller, so they say, and this applies as much to actuaries as it does to anyone else, as 42% of our members live or work outside of the UK and this figure continues to grow. So what do we do for, and with, our members worldwide as part of our royal charter requirement to promote actuarial science? How can we make engaging with other international bodies good not only for our members outside the UK but also for the 58% of our members working and living here?

Last month, we hosted in London one of the biannual International Actuarial Association (IAA) meetings. Representatives from many of the 65 actuarial member associations from around the world came together to discuss best practice, and ways they can collaborate to take forward actuarial science in areas such as education, regulation, financial risk, accounting and actuarial standards. The mission of the IAA – as the worldwide organisation of actuarial associations – is to represent the actuarial profession and promote its role, and to promote professionalism by developing education standards and encouraging research.

A strong IAA is crucial for the profession. We think it is an important way to gain influence and develop commonality with other associations with the aim of raising the profile of the work actuaries do. As understanding of actuarial work grows throughout the world, so too will demand for actuarial services. This will benefit actuaries whether in the UK or overseas and is consistent with my desire, as I stated in my presidential address, to widen the understanding of the value that actuarial input can bring to business issues, not just in our traditional fields.

International collaborations can also help associations learn from each other. A prime example of this is Australia and South Africa being well ahead of the UK in their involvement with banking institutions. This is an area into which some UK actuaries are diversifying, and lessons can be learned from these other countries that can then help us in the UK to broaden our skill set and move into nontraditional industry sectors.

Our strategy for international membership is to work alongside other developing associations, sharing knowledge and best practice. It is important to note that we are

Increasing globalisation means sharing actuarial knowledge and practice, says Nick Salter striving to be an inclusive body that works towards the public good, rather than an organisation focused on growing our international membership for the sake of it.

An example of our strategy coming to life is with the introduction of the new Certified Actuarial Analyst (CAA) qualification. It is designed to provide a technical level skill for people working alongside actuaries and also for those working in wider financial services who may want to diversify their skills base. By allowing those working in the global actuarial industry the opportunity to gain a professional qualification that requires continued professional development and a code of conduct, it will help the growth of actuarial science and the members of actuarial associations around the world.

These are exciting times for the CAA as the first exam was sat at the end of August and it will be interesting to see how the qualification and its reach will develop over time. We have seen a lot of interest from other actuarial associations around the world in learning how the qualification fits in with our existing membership structure and whether something similar could be suitable for them.

One of the aspirations for our profession is a

continuation of the initiative introduced by my predecessor, David Hare, which was for us to be relevant to the changing needs of the world in which we work, and I believe our international efforts and the continuing development of our qualifications such as the CAA can help us achieve this.

Increasing globalisation means no country is an island, and continuing to broaden our reach outside our borders will ensure that the IFoA, and its members, retains relevance and influence in a future world. The IFoA will serve its members best, whether they be in the UK or overseas, by ensuring that it has influence and contact globally.

One last thing to note is the result of the Scottish Referendum. Our Scottish Board did some excellent work, playing an active role in informing the debate with both the Scottish and UK governments. The resulting No vote means that we now have more certainty on the way forward, which is very welcome.

There is much more work to be done, however, and I can confirm that the IFoA will continue to work with Westminster and Holyrood in seeking out relevant areas to contribute to issues in the public interest where we can add real value. a

“As understanding of actuarial work grows throughout the world, so too will demand for actuarial services”

October 2014 • THE ACTUARY 7 www.theactuary.com

p07_Oct_pres_comment•SEMIFINAL.indd 7

23/09/2014 15:44

›

Opinion Soapbox

STEPHEN SOPER

Joining the dots While I hope the publication of the Pensions Regulator’s new defined benefit (DB) code this summer was on your radar, you may have filed it in a part of your brain labelled ‘to think about when I do the next triennial valuation’.

Here’s why you need to keep it in mind whenever you speak with scheme trustees.

We know DB schemes have had a hard time in recent years. The decline in equity returns, low interest rates, volatile markets and a recession have challenged the funding position of schemes and put pressure on sponsoring employers, an already difficult situation compounded by increasing member longevity and scheme maturity.

In the nine years we have been regulating, we have learned that having a good handle on the risks a scheme is facing is vital for trustees. Many schemes are already on top of this, but we also know from our regulatory activities that others aren’t. This is why one of the most important features of the code is about managing risk in an integrated way.

Risk has always been part and parcel of the funding regime, so what makes the ‘integrated’ aspect different? It should not be approached as a radical departure from what you currently do, more a joining up of the dots, which requires consideration of how trustees’ decisions about covenant, investment and funding interact.

The central concept here is the balance between new money from the sponsor, the expected investment returns from the scheme assets and the relevant timeframe.

Any material change to one area will have an impact on the others, which is why we want trustees and scheme sponsors to have a closer working relationship so that the needs of both parties can be better understood and factored in the decision.

A common misperception is that the regulator wants all risk to be eliminated. Risk isn’t necessarily a bad thing for a pension scheme, if it is appropriate, understood and managed well in the context of the employer covenant. While the triennial valuation provides an opportunity to test and develop the overall framework, important events will occur between valuations and trustees need to stay on top of these, rather than pick up the pieces later.

Although this may be challenging for some

8

An integrated approach to managing pension risk is vital, says Stephen Soper trustees, we want them to take a proportionate approach, so small schemes can manage their risks effectively without breaking the bank.

We are not necessarily looking for an all-singing, all-dancing integrated risk management plan – trustees can use minutes of trustee board meetings or other scheme documents to record their thinking. And the sophisticated, expensive analyses appropriate for large schemes will not necessarily be suitable for small schemes.

What does this mean for actuaries? Are we expecting them to be covenant advisers as well, or take on the role of trustees?

Of course not – it is the trustees’ responsibility to manage scheme risks and take funding decisions, with appropriate advice.

But as actuaries play a key role in the valuation process, looking at assumptions, funding targets and recovery plans, we think there is an opportunity to enhance this role by ensuring that it integrates well with the rest of the process.

Actuaries should be mindful that trustees will need to join up all the information they

receive across covenant, investment and funding. So the advice given on, say, technical provisions and the recovery plan will need to be aligned to that of other advisers and framed in the context of the covenant assessment and investment strategy.

It is also crucial that you communicate with member-nominated trustees in plain English.

As an industry, we need to make a greater effort to communicate with lay trustees in language they can genuinely understand.

We have developed an ‘Essential Guide’ for those who aren’t steeped in pensions terminology, and would encourage you to signpost it to those who may need a more basic grounding in the principles of the DB code.

We are very keen to learn more about how trustees, employers and their advisers are applying the code, so we will soon be embarking on a series of roadshows around the country, where we hope to discover what works, and whether there is a need to develop more specific guidance in certain areas.

“A common misperception is that the regulator wants all risk eliminated.

Risk isn’t necessarily a bad thing”

Stephen Soper is interim chief executive at The Pensions Regulator

THE ACTUARY • October 2014 www.theactuary.com

p08_oct_soapbox•SEMIFINAL.indd 8

23/09/2014 15:45

MONDAY 13 OCTOBER

Welcome Drinks Staple Inn Hall High Holborn London WC1V 7QJ Drinks 5.30pm Presentations 6.00pm

TUESDAY 21 OCTOBER

Jubilee Lecture and SIAS AGM Staple Inn Hall High Holborn London WC1V 7QJ Refreshments 5.30pm SIAS AGM 5.45pm Lecture 6.00pm

SOCIAL EVENT

SIAS would like to welcome new members of the Institute and Faculty of Actuaries to a cheese and wine evening at Staple Inn Hall. This event is a great way for new members to meet fellow new joiners and to learn more about the profession, the qualification process and SIAS, whilst enjoying a selection of fine wines and delicious cheeses.

The tasting will begin at 5.30pm and will be followed at 6.00pm by a series of brief talks covering the education process, SIAS and business skills.

For those of you not so new to the profession, please encourage any new joiners from your company to attend. There is no need to register in advance for this event.

JUBILEE LECTURE & SIAS AGM

Speaking at this year’s Jubilee Lecture will be Steve Webb, minister of state for pensions, and Steve Groves, CEO of annuity writer Partnership (see interview, page 18).

The UK pensions landscape has undergone a series of radical reforms in 2014, with retirees now granted greater access to their pensions pots and faced with more choices as to how to invest and spend their pensions. With the removal of compulsory annuitisation for many investors, the UK annuity market is undergoing a major overhaul as providers seek to remain competitive in the face of shifting market conditions.

Our Jubilee Lecture speakers will offer two different perspectives on the changes made to the UK pensions market, their impact to date and going forward. Steve Webb, as pensions minister in the coalition government, has overseen the creation and introduction of the new pensions rules.

Steve Groves, as CEO of one the largest UK annuity writers, has firsthand experience of dealing with the commercial effects of the rule changes.

Refreshments will be served from 5.30pm and the lecture will follow the SIAS AGM, which will run from 5.45pm to 6.00pm.

There is no need to register in advance for this meeting, and non-members are welcome.

There will be live tweeting throughout the talk via #SIASOct14.

Please get involved with any comments or questions for the speakers.

FRIDAY 21 NOVEMBER

Annual SIAS Dinner Save the date!

SOCIAL EVENT

Save the date for the Annual SIAS Dinner, which will be held at The HAC on Friday 21 November.

Tickets will go on sale on 13 October at 9am.

Look out for further updates over the coming weeks.

MORE EVENTS ONLINE For details of events, visit www.sias.org.uk

SAM KESTEVEN / SAM PEACH

p09_Oct_sias•SEMIFINAL.indd 9

SIAS IS ON TWITTER! Follow us on @SIAScommittee for latest news on meetings, socials and more!

SIAS IS ON FACEBOOK! Check out the SIAS Facebook page for photos from the latest social events

October 2014 • THE ACTUARY www.theactuary.com

9

23/09/2014 15:45

News IFoA NEWS UPDATES FROM THE ACTUARIAL PROFESSION

Upfront Opinion CEO’s comment Derek Cribb reflects on why the IFoA Fellowship qualification adds value, quite literally, in Asia

A million-dollar question Derek Cribb is the chief executive of the Institute and Faculty of Actuaries

month’s magazine, written by Jonny Plews from Oliver James Associates’ Hong Kong office, on how the salaries of the IFoA’s members in Asia compare with those of other actuarial professional bodies. I’ve been reflecting on the variance in the survey results and asking myself why this might be.

When I visit Asia, I often hear that the IFoA’s exams are harder to pass than those of other qualifying actuarial bodies. While such feedback is, to a degree, subjective, I believe that our exams are challenging because they equip our members with the skills that they need to progress at pace to more senior roles in their future careers.

Our Fellowship qualification is not about learning by rote – the judgement that trainee actuaries learn to apply through their studies with the IFoA makes them an attractive asset in the workplace. Rather than a purely academic or technical qualification, the IFoA offers a professional qualification that places value on important business skills such as communication, as well as technical knowledge and, more importantly, the application of that knowledge.

With the average actuary qualifying today in the Asian market likely to earn over $10 million over the course of their career, the Oliver James survey results suggest that IFoA qualified actuaries are able to earn around 10% more. To put it another way, the IFoA Fellowship can attract a premium in excess of $1 million over the course of a career.

There are many factors to consider when deciding on which qualification to pursue, and the IFoA qualifications are not the right choice for everyone. However, using earnings as a simple market indicator of fitness for purpose, it is reassuring to see from the Oliver James survey that both the quality and relevance of the IFoA’s qualifications are being recognised by employers in Asia.

The principles of business relevance and highquality technical content underlying our Fellowship qualification, which are so clearly valued by employers, have also been applied to the new Certified Actuarial Analyst qualification.

We trust that, in time, the market will equally demonstrate the value this new qualification is bringing.

DEREK CRIBB

10

I read with interest the article in last

THE ACTUARY • October 2014 www.theactuary.com

p10-13_Oct_IFoA_news•SEMIFINAL.indd 10

Statement to members on Referendum The Institute and Faculty of Actuaries (IFoA) has played an active role in informing the Scottish Independence Referendum debate.

The Scottish Independence Referendum was a momentous occasion in the history of Scotland and the UK. The Scottish electorate has spoken and, while independence was not the outcome, there is clearly an appetite for constitutional change.

The IFoA will continue to play its part in informing that debate in areas where actuaries provide expertise, such as insurance, pensions and risk management, both in a regulatory capacity and regarding the implications for the future growth of the financial services sector.

As a not-for-profit royal chartered professional body, the IFoA has a duty to serve the public interest. In this capacity, the IFoA will continue to work with the governments in both Edinburgh and London.

China microsite goes live The arrival of autumn brings with it the launch of our brand-new China microsite, which is now live at www.actuaries.org.cn.

The microsite has been specifically designed to increase our visibility in China. It is designed to showcase exactly what being a member of the IFoA can offer to students and employers.

Detailed information is provided on the study routes and qualifications available. It also gives us a platform to showcase members and events.

The project has benefited hugely from the involvement of our actuary representatives in China and Singapore, Wen Li and Caryn Chua.

PA

23/09/2014 16:58

Professional skills: when to blow the whistle The Professionalism Content Development Working Group (PCDWG) has developed new video case studies and additional resource material on the theme of ‘Speaking up’, ‘Whistleblowing’ and ‘An open culture in organisations’ accessible via the website.

Jim Baxter of the Inter-Disciplinary Ethics Applied Centre, University of Leeds, sets the scene on behalf of the PCDWG for the IFoA’s 2014/2015 online professional skills content Whistleblowing is a key pillar of efforts to protect the public from the consequences of unethical and illegal behaviour. The number of reports to the whistleblowing helpline run by the Financial Conduct Authority (FCA) has increased by 64% since April 2013, and by 414% since 2008/9, according to figures from Pinsent Masons.

Nonetheless, many staff who witness unethical behaviour in the workplace fear a backlash if they make a report. These concerns are not without warrant: whistleblowers often face retaliation, both overt (threats, bullying, dismissal) and more subtle (ostracism by colleagues, missing out on promotions).

Formal whistleblowing is just one example of ways in which concerns can be raised.

Sometimes it is possible to speak out less formally, simply by talking to a colleague or your line manager. Where this option is available, outcomes are usually better both for the individual and the organisation. Isolated

problems can be addressed before they become unmanageable, and the risk of retaliation to the person speaking out is less severe. But sometimes there is no choice but to take a more formal route. Options then might include using an internal whistleblowing hotline, speaking to Public Concern at Work, to the Institute and Faculty of Actuaries, directly to the FCA or, in extreme cases, going to the press.

The decision whether to speak out is one with a complex ethical dimension. Judgment is required to know when raising concerns is justified, and when it is obligatory.

Understanding your professional obligations as set out in codes of conduct is obviously important. It is also important to develop an understanding of key ethical concepts. For example, what does it mean for a disclosure to be ‘in the public interest’? How can we negotiate the sometimes conflicting values of openness and confidentiality?

The responsibilities of employers are, of course, just as important. In an organisation with an open culture, employees will feel they can speak out if they have concerns, and that those concerns will be taken seriously. Leaders need to be proactive in ensuring that employees are encouraged to come forward, and that those doing so are protected from retaliation.

The Institute and Faculty of Actuaries, working with the University of Leeds, has developed a case study built around these

Malcolm Slee, chairman of the PCDWG considerations. In the case study, an actuary becomes concerned that her organisation is advertising an investment fund in a potentially misleading manner. What should she do?

You can read the case study at bit.ly/1pSljMZ You can view Pinsent Masons’ figures on whistleblowing at bit.ly/1uxb46d View events on this topic at bit.ly/XcDsPK

Resource and environment agenda unwrapped

By Oliver Bettis, chairman, Resource and Environment Board There are more than seven billion people alive today sharing the resources of the planet earth.

The UN estimates that the population will be between three billion and 25 billion people in the year 2150, which equates to a population growth rate of between -0.5% and +1.0% a year over the next century or more. This huge range partly reflects uncertain predictions of how large a population could be sustained by the urces are planet. Energy and food resources y fare in strained today – how will they future? This issue also reflectss a ut the type fundamental uncertainty about of economy that will exist to develop n people. and allocate resources between This highlights just one of a series of challenges facing actuaries as they try to understand the financial environment in which their clients will

operate in future. These require actuaries to expand their horizons to incorporate new data and challenge the core models we have developed over a number of years.

The Resource and Environment Board was established in January 2014 to address these issues on the behalf of the IFoA. This is a historic development: we are the first actuarial body in the world to incorporate resource and environmental issues into actuarial work in this way. Nevertheless, we see this as a completely logical and natural development, responding to the cha challenges posed by the 21st century century.

As o one of its first actions, the board agreed three high-level objectives. su 1. To support actuaries in existing practic areas with resource and practice envir environment issues.

2 To develop the actuarial 2. p profession, enabling actuaries to work in the resource and environment area.

3. To serve the public interest.

We expect the majority of actuarial work to be affected by these issues in some way over time, so our main focus in the short term is on supporting existing practice areas and giving actuaries the tools to work with these problems.

Actuaries’ core skills are in translating real-world data into the models used to generate advice over the long term, basing their decisions on the best available information rather than on preconceived ideas. While we think that models may need to be adjusted to allow for resource and environmental factors, we certainly think the actuarial skill set is the right one to bring to these problems.

Actuaries are a group of professionals who could be outstanding in this field, and others outside the actuarial profession are starting to notice this as well.

This is just the beginning of a long journey for actuaries working in this field, but we’re looking forward to building up experience and influence in a variety of key areas in the next few years.

October 2014 • THE ACTUARY 11 www.theactuary.com

p10-13_Oct_IFoA_news•SEMIFINAL.indd 11

23/09/2014 16:59

News IFoA NEWS UPDATES FROM THE IFOA

Volunteer to become a CAA examiner This August, the first of the Certified Actuarial Analyst (CAA) exams were made public. With around 100 exam takers in 21 countries worldwide, the profession owes much of the success of the qualification to the volunteers who have worked in the background, writing questions and tweaking mathematical formula.

Unlike traditional IFoA exams, all of the CAA exams are entirely computer-based.

CAA exams are written in conjunction with Pearson VUE, a world leader in computerbased assessment. These differences mean that the exam setting process flows differently from traditional practices. A Module 0

principal examiner commented that writing questions is “not as easy as you think. I found it satisfying when a question was simple, elegant and just worked”.

Exam setting, conducted via an online platform, begins with item writers authoring exam questions, moves to a thorough review of the content and finishes with an evaluation of the exam. An assistant examiner described the experience as “learning a whole new skillset”. This new approach has attracted a variety of specialists, including an academic who set exam questions for Modules 0-4. We feel it is important that actuarial academics are represented in the construction of the

qualification. This diversity in skillsets is key in writing exams for a global qualification, and the Pearson VUE formula enables a range of experts to collaborate seamlessly.

Process aside, the driving theme is the belief that CAA is an important development for the profession. “The introduction of the CAA is an opportunity to break the stigma that all members of an actuarial team should strive for Fellowship,” said a Module 0 assistant examiner. “This allows employers, and the profession, to show they value their technical staff.”

For further information, visit bit.ly/1tPdL5e or email robert.jelly@actuaries.org.uk

Website launch delayed

Subscription renewal notice

CPD co-ordinators event

Referencing the piece ‘Five minutes with…

Kathryn Morgan’ in the September issue. This stated the new IFoA website would be launched in September. The website launch will be later this year, as rigorous user acceptance testing has created more vital development work. The IFoA is fully committed to delivering the digital experience and usability that both members and staff need and deserve.

The subscription notice for 2014/2015 is now available and can be obtained by logging onto the members’ area of the website and selecting ‘subscription letter’. Payment can be made online, or members can pay by BACS, credit or debit card, cheque (payable to the Institute and Faculty of Actuaries) or direct debit.

Please email membership@actuaries.org.uk or telephone 0131 240 1325 with any enquiries

The CPD co-ordinator from each organisation has been invited to attend a briefing event in London on 4 November. If you do not as yet have a CPD co-ordinator or they are unable to attend, please let us know and a copy of the slides and handouts will be sent out afterwards.

To book a place or find out more, please email

debbie.atkins@actuaries.org.uk

Disciplinary Tribunal and Adjudication Panel hearings At a Disciplinary Tribunal Panel hearing on 28 and 29 July 2014, the tribunal considered charges of misconduct relating to the receipt and sharing of information about the content of the CT5 examination sitting in October 2012. The tribunal considered linked cases against Mr Suleman Ishaq, Mr Wing Lung Lau, Mr Michael McCarter and Ms Aneri Shah (the respondents).

Mr Wing Lung Lau, Mr Michael McCarter and Ms Aneri Shah The tribunal did not find the charges against Mr Wing Lung Lau, Mr Michael McCarter or Ms Aneri Shah to have been proven, nor that they had acted dishonestly, and the tribunal therefore dismissed all charges. No further disciplinary action in relation to this matter will be taken against these three respondents.

The tribunal heard an application for costs against the Institute and Faculty of Actuaries from each of the respondents, but determined that no costs award should be made in favour of the respondents in these cases.

Mr Suleman Ishaq Having considered the evidence, the tribunal found the charge against Mr Suleman Ishaq

12

proven and that Mr Ishaq had acted dishonestly. The tribunal consequently found that Mr Ishaq’s actions amounted to misconduct.

The tribunal imposed upon Mr Ishaq a suspension of membership for a period of one year commencing on 29 July 2014.

A summary of the panel’s reasons follows.

In the panel’s view, the respondent must have known that the information which he had received was confidential; he knew also that it had been passed on unwittingly to him by respondent 1. The respondent deliberately then passed on this information to others who were due to sit the examination on the following day.

Having done so, he then sat the examination and at no time thereafter chose to report the disclosure of the information which had come his way either directly to the IFoA or as a first step to seek advice from an experienced actuary within his employer as to what he should do.

In considering whether the respondent had acted dishonestly by reason of his actions as described in paragraph 1 of the charge, the panel used the tests set out in the case of R v Ghosh, which the panel found to be satisfied.

The level of severity of the sanction reflects the

panel’s concern that, among other things, the actions of the respondent were dishonest, deliberate, repeated, resulted in three other student members being put in potentially compromising situations and interfered with the examination process of the IFoA. A lesser sanction is not, therefore, felt appropriate.

Adjudication Panel Ian William Conlon FIA On 10 July 2014, the Adjudication Panel determined that the case report disclosed a prima facie case of misconduct in respect of an allegation that the respondent failed to produce a report and to communicate with those instructing him in a timely manner.

In accordance with Rule 4.4(a)(i), the panel invited the respondent to accept the following sanctions: ● a reprimand; ● a fine of £6,000; and ● a period of supervised practice.

The respondent accepted that there had been misconduct and accepted the above sanctions.

Full reports on all the above cases, including the panel’s reasons, can be found on the IFoA’s website at bit.ly/KCGCU7

THE ACTUARY • October 2014 www.theactuary.com

p10-13_Oct_IFoA_news•SEMIFINAL.indd 12

23/09/2014 16:59

18th East Asian Actuarial Conference

EVENTS AND CONFERENCES IFoA and PRIMA joint event 20 October, London Insurance-linked securities have developed into an asset class in their own right, with $6 billion of new cash being invested in the first half of 2014 and accounting for 15% of the property catastrophe market capacity. Speakers will explore why this class has been growing at 20% pa, the types of investments available and the regulatory and operational framework underpinning the class.

Book your place at bit.ly/1CZwpdD

Life Conference and Exhibition 2014 9-11 November, ICC, Birmingham

Described as the premier event for top professionals, Life Conference and Exhibition 2014 is a mustattend event for anyone within the life insurance sector wishing to hear the latest policy and regulatory developments affecting the industry.

To book, visit bit.ly/1tNhFeX Follow us on Twitter at @actuarynews (#IFoA)

Masterclass: Personal Impact 26 November, London Masterclasses are a series of live events, developed by experts in the field, to help actuaries achieve success in all areas of business.

This seminar introduces you to the power of non-verbal

intelligence and communication.

You will learn practical techniques to use in your everyday professional interactions which will increase your credibility, influence and gravitas.

Book your place at bit.ly/1BuRgUq

SAVE THE DATE Current Highlights in Pensions seminars 22 October, Bristol 4 November, Glasgow 11 November, London 20 November, Leeds 26 November, London

The IFoA is delighted to be a gold sponsor of the 18th East Asian Actuarial Conference (EAAC), to be held on 12-15 October in Taipei, Taiwan. Key members of our executive, including chief executive Derek Cribb and membership director Memoria Lewis, will attend and would be delighted to meet as many members as possible. At our stand you will be able to find out more about our research, member services, volunteering and the new Certified Actuarial Analyst qualification.

Members will also have the opportunity to meet Caryn Chua, our new actuarial representative.

Based in the new Singapore office, Caryn will team up with Wen Li in representing and supporting members in South East Asia.

Book at bit.ly/1y5viZW

After dinner speaker announced:

Momentum Conference 2014

James Cracknell, OBE

3-5 December, Edinburgh International Conference Centre The Momentum Conference is aimed at students and recently qualified actuaries from across all practice areas. With a mix of technical, topical, business and networking opportunities combined, this year’s programme will include the following presentations: Diversity and the Changing Face of the Actuary, Nick Salter, President, IFoA and Chris Matthews, SutherlandsPugh Can Actuaries Save the World?, Oliver Bettis, IAA Resource and Environment Group Chair Big Data - What’s in it for Us?, Colin Forrest and Kiran Sandhu, Deloitte Painting Pictures of the Brain by Numbers: Neurology for Actuaries, Adele Groyer and Ian Cox, Gen Re Workshops topics cover all practice areas and you can choose from a range of technical sessions and Masterclasses.

Sponsorship and Exhibition Opportunities Please contact: danielle.reiterbund@actuaries.org.uk

Book your place by 6 October to receive the early bird delegate fee To find out more information about the Conference and to book a place visit: http://www.actuaries.org.uk/events/residential/momentum-conference-2014

October 2014 • THE ACTUARY www.theactuary.com

p10-13_Oct_IFoA_news•SEMIFINAL.indd 13

13

23/09/2014 16:59

If you have any newsworthy items for these pages please email social@theactuary.com

News People & Society

A sunset summer sail for SIAS

By Anique Buddhdev On Friday 25 July, more than 200 actuaries boarded the Golden Jubilee at Temple Pier for the annual SIAS summer boat party. With the kind help of Darren Murch from Willis, we decorated the boat for our Hawaiian-themed evening as a thunderstorm descended over London. As guests arrived, however, the clouds had cleared and we had sunshine throughout the event, a weather miracle some may say!

On arrival, guests were welcomed with a Hawaiian luau garland along with a glass of Pimms, after which they were free to roam around the craft as we sailed up and down the river Thames. It was great to see everyone make

such an effort – the array of different Hawaiian shirts was quite phenomenal. I would like to congratulate Tom Sankey and Marta Goesk for winning a bottle of prosecco for being best dressed male and female aboard.

The upper sun deck seemed to be the most popular part of the boat, where people could enjoy drinks outdoors, admiring the sights of London and enjoying the aroma from the BBQ. Dinner was later served, with guests enjoying a wide range of food from sausages to lamb chops.

Our casino table proved popular among the statisticians onboard – congratulations to Bhavesh Vara, who won an Amazon voucher for winning the Blackjack competition.

Other highlights of the event included two palm trees, one made from sweets and marshmallows, and the other from an array of fruits for people to sample and enjoy with a range of dips.

After dinner, the dance floor was the place to be, with everyone showing off their moves!

Time flew and soon we were docking back at Temple Pier. For those guests who wanted to continue, we held an after party at the nearby Opal Bar, where many of the guests boogied until the early hours of the morning.

Many thanks to Capital Pleasure Boats for being so obliging and everyone for attending as the night was a great success.

Inspiring the profession’s next generation

By Mark Gorman SIAS has increased its focus on introducing the actuarial profession to mathematically minded sixth-form students from inner-city London schools. It has teamed up with The Brokerage Citylink – an independent charity providing young Londoners with a ‘pathway’ of opportunities into employment. Over the past year it has pursued two avenues to: ● provide a series of 45-minute ‘in school’ sessions during April, May and June, where SIAS took two or three volunteering actuaries into a school to present to students on what actuaries do;

14

provide an afternoon session in July at Staple Inn, which included a more in-depth presentation introducing the actuarial profession, followed by a business game with four volunteering actuaries that gave the school students a taste of the day-to-day challenges faced by actuaries.

All sessions received very positive feedback from the schools and the attending students.

Some comments included: “students got a lot out of the session” and “the attending actuaries were very engaging and well prepared”.

The primary tangible benefit from the sessions was that the inner-city London

●

school students were made aware of a profession that represents a possible future career. However, in line with SIAS’s aim to “serve the interests of younger members of the profession”, there was significant focus placed on providing meaningful development opportunities for actuaries to hone their presentation skills.

Thanks to all actuarial volunteers, The Brokerage Citylink and the schools who made the events such a success. SIAS intends to continue running sessions.

If you are interested in volunteering in the future, please email charity@sias.org.uk

THE ACTUARY • October 2014 www.theactuary.com

p14_15_Oct_soc_news•SEMIFINAL.indd 12

23/09/2014 17:00

LIKE US ON FACEBOOK www.facebook.com/ TheActuaryMagazine

FOLLOW US ON TWITTER @TheActuaryMag @ActuaryEditor

JOIN US ON LINKEDIN www.linkedin.com/groups/Actuarymagazine-UK-Group-3751335

Where maths meets poetry

By Paul Scully I realised a lifetime ambition on 26 April when renowned poet, Les Wicks, my wife, Julie, and my children, Alana, Leigh and Rick, helped me launch my first poetry collection at Gleebooks.

The launch marked my second serious attempt at publication. It began when I left full-time work to embark on a so-called portfolio career, started attending workshops run by prominent poets including Les Wicks and Les Murray and had poems accepted for the occasional paper-based or online literary and topical journal. After accumulating the usual pile of rejection slips for the manuscript, I sent it to the publisher of a Tasmanian journal who had accepted a poem. I was surprised and thrilled when he agreed to publish it.

The collection is entitled An Existential Grammar and is published by Walleah Press.

I have always regarded poetry,

mathematics and music as closely related.

I recently came across a quote from the great economist, Alfred Marshall: “There are, I believe, in the world few things with greater capability of poetry in it than the multiplication table”. The second line of the poem that opens my collection refers to “the combinatorial mercies of war”.

Kenneth White in Croydon The Strand at an uncertain hour Li Po and Tu Fu have not yet opened the newsagency A misplaced crow cores the air a reflective ibis by the bin, scraps like gulls on a time-shore A An older man hat raked back mouth, face corrugated in thought A median strip where pedestrians p pause before darting between the cars A glacier once ground through here?

This is philosophy?

Are you an ‘other half’ too?

By Jacky Pendleton Those of you who have a current or retired actuary as a partner, wife or husband will know part of their professional and social life involves attending various seminars often coupled with dinners and events.

‘The Other Half Club’ offers you the same opportunity for socialising with like-minded people and making new friends, all of whom understand what it’s like being the other half of an actuary.

We welcome new members to our club, which contains a variety of personalities and hosts a broad range of events, hopefully suiting most tastes, including dinners, theatre, walks and art exhibitions.

If you are interested in joining us or for more details about the club, do get in touch.

Email: theotherhalfclub@gmail.com or phone Jacky Pendleton (chair) on 07768 200539 or Lesley Birse (secretary) on 01689 836392

Brogan’s run B O Sunday 13 April, John Brogan ran the On L London Marathon in a very impressive two h hours 59 minutes. Through generous d donations from family, friends and colleagues, h raised over £1,500 for the Scottish Catholic he I International Aid Fund, which works with some o the poorest people in the world living with of p poverty, hunger, war and disease. The s sponsorship was matched by JLT, so thanks to them and everyone who sponsored him.

Well done to John and all the JLT employees that took part in this year’s marathon.

For details about the Scottish Catholic International Aid Fund, visit www.sciaf.org.uk

WWI actuaries remembered

By Martin Miles Members of the Worshipful Company of Actuaries and their partners spent the weekend of 30/31 August in Ypres, Belgium, and the Somme in the north of France. On the Sunday they laid a wreath at The Menin Gate in Ypres in memory of the 125 members of the Institute of Actuaries and the Faculty of Actuaries who gave their lives during the Great War. The wreath-laying party was led by the master of the company, Martin Miles, supported by Nick Dumbreck, past president of the Institute, Andrew Benke, past master and Fraser Low, past president of the Faculty and past master. At dinner, Martin Miles read out part of past president Sir Alfred Watson’s moving speech given at Staple Inn in March 1922 at the unveiling of the institute’s WW1 memorial tablet. Other readings were given by past masters Graham Clay, Richard Hawkes and Alan Frost.

During the weekend, the group of 40 visited many battlefields, cemeteries and memorials in the area, assisted in their understanding of the history of events by Colin Parslow, a retired army officer and an excellent guide who has led tours for the Royal British Legion for many years.

Deaths: Mr Michael Anthony Walker HALL died recently, aged 69. He became an affiliate in 2000.

We would be delighted to hear from you if you have any newsworthy items for these pages. Please contact Yvonne Wan at social@theactuary.com

October 2014 • THE ACTUARY www.theactuary.com

p14_15_Oct_soc_news•SEMIFINAL.indd 13

15

23/09/2014 17:00

› GENERAL INSURANCE

NEWS ROUND-UP

Europe’s insurance run-off market ‘grew by €7bn’

Insurance losses from catastrophes fall in 2014 Insurance losses from global catastrophes stood at $21bn in the first six months of this year, around $4bn lower than the same period in 2013, a preliminary estimate from Swiss Re revealed.

The figures from the firm’s Sigma database found that of these, natural catastrophe-related insurance claims made up $19bn, which was also down, from $21bn in the same period last year.

Overall, total economic losses from disaster events were $44bn, and more than 4,700 people died as a result of natural catastrophes and man-made disasters.

At $21bn, insured losses were also lower than the average across the first six months of the year in the last decade, which stands at $27bn.

Among the major events were severe storms across the US in May, which led to $3.2bn of total losses, of which $2.6bn was insured. Storms in Europe the next month caused significant damage to properties and vehicles in parts of France, Germany and Belgium, causing total economic losses of $2.7bn, of which $2.5bn were insured. A snowstorm in Japan in February (pictured above) caused $5bn of total losses, with insured losses making up half of this.

See more at bit.ly/1p3JTeS

Insurers ‘uncertain’ about Solvency II implementation With just over a year before the Solvency II implementation, the insurance industry is “beset with uncertainty”, KPMG suggested.

Its Public reporting in a Solvency II environment report found that firms fear guidance or regulator positions could change ahead of the capital rules implementation and are keen to avoid disclosing either too much or too little information as a result.

The report looked at 11 multinational insurance companies in the UK and continental Europe. It stated: “Firms are increasingly considering what SII disclosures are needed before SII implementation so they can manage expectations and educate the investor and analyst community... Firms are weighing up what they should reveal and when. We see greater appetite from analysts for some SII results as implementation draws closer. But overall, we see concerns. Firms are concerned about disclosing too much, or disclosing the wrong thing, so they have to backtrack if guidance changes.”

KPMG said own funds, SCR (Solvency Capital Requirement) and surplus were the most common metrics that firms intended to disclose, both before and after SII implementation.

See more at bit.ly/YXOuJB

16

THE ACTUARY • October 2014 www.theactuary.com

p16_Oct_gen_ins_news.indd 16

The European insurance run-off market grew by €7bn this year and will continue to grow as Solvency II drives deals, a PwC survey claimed.

Its annual survey on discontinued insurance business revealed that the European run-off market was now worth €242bn, up from €235bn in 2013. Based on the responses of 200 organisations, PwC found that a majority of this increase came from German and Swiss run-off books.

The consultants’ Unlocking value in run-off survey predicted that run-off transactions would peak during the coming year as Solvency II drove a renewed focus in core business and led to organisations deciding to exit non-core lines. Also, two thirds of the organisations surveyed said they would increase their focus on dealing with underperforming lines of business due to Solvency II. Dan Schwarzmann, head of PwC’s solutions for discontinued insurance business, said: “It has been another busy year in the insurance run-off sector and we expect this activity to continue.

The market has grown to €242bn this year and we expect it to grow further as a result of the impact of Solvency II. “There is likely to be a steady flow of companies attempting to dispose of, or exit from, legacy business that will not be capital effective in their post Solvency II balance sheets.”

See more at: bit.ly/1uYY60k

GI

Consumer insurance premiums ‘down by nearly 5%’ Insurance premiums for home and motor cover fell by 4.9% in the second quarter of the year compared to the same period in 2013, according to the British Insurance Brokers’ Association.

The brokers’ Insurance Price Index, which is compiled with consultants Acturis and examines nearly £5bn of premiums per year, found that prices had fallen across its “shopping basket” for consumer insurance.

The biggest fall in percentage terms was a 5.6% drop in the cost of motor insurance during the quarter, while home insurance premiums fell by 4.2% compared to the same period last year.

BIBA’s executive director, Graeme

Trudgill, told The Actuary that a combination of factors had helped put pressure on reducing the cost of motor insurance premiums.

“The Ministry of Justice has just come out with the latest in fighting the cost of whiplash, and it implemented the Legal Aid, Sentencing and Punishment Offenders Act (2012) which outlawed referral fees in personal injury cases.

Certainly insurers have dropped premiums with that in mind, and that should have a positive outcome.

“There’s also been the Department for Transport’s involvement in continuous insurance enforcement, and the uninsured driving rate has dropped.”

See more at: bit.ly/Zu7orm

MORE GI NEWS ONLINE For further GI news, visit www.theactuary.com/news

GETTY

23/09/2014 17:20

News Industry news@theactuary.com

The Scottish ‘No’ vote could still change pensions, say actuaries

Retirees have ‘more money than they need’

Scotland’s decision to stay in the United Kingdom will not mean no change for pension schemes, actuaries have warned.

Couples who retired in the last decade have far more money than necessary, according to the Institute for Fiscal Studies. It found that 92% of couples born in the 1940s had more wealth than its model suggested they need to maintain their standard of living into and through retirement.

In the 18 September ballot, the people of Scotland rejected independence by 55% to 45%, after a two-year campaign. Although Scotland will remain part of the UK, changes to income tax promised by the three main Westminster parties “will have interesting consequences for pension plans and their sponsors”, actuarial firm Towers Watson said.

Stronger tax-varying powers for the Scottish Parliament could affect both tax relief on pension contributions and the tax due on pension payments, the firm said.

Barnett Waddingham urged pension schemes not to rest easy on the decision.

Partner Mike Kennedy said: “The Scottish Parliament was promised additional powers from Westminster in the run-up to the vote and it is likely that they will seek to use them.

“If differences arise in legislation and taxation between Scotland and the rest of the UK, this will lead to complications for administering schemes with members in both regions, and therefore increased costs.”

At the Institute and Faculty of Actuaries (IFoA), leader of the Scottish board Martin Potter said the referendum showed a clear appetite for constitutional change.

“The IFoA looks forward to playing its part in informing the debate in areas where actuaries provide expertise such as insurance, pensions, and risk management, both in a regulatory capacity and the implications for the future growth of the financial services sector.”

See more at bit.ly/1yjj5kl

UK gets key EU portfolio for insurance and pension regulation UK politician Lord Hill is set to be handed a senior economic post in Brussels, which will include responsibility for the new Solvency II regulations for the insurance industry.

Hill will take up the newly created post of commissioner for financial stability, financial services and capital markets union once the make-up of European Commission president-elect Jean-Claude Juncker’s team is approved by MEPs. The portfolio has been created after the decision to break up the existing internal market department of the commission, which had been headed by French commissioner Michel Barnier, and move responsibility for financial regulation.

Hill will therefore be responsible for the European supervisory authorities, including EIOPA (European System of Financial Supervision), the regulator for insurance and pensions.

The National Association of Pension Funds said Hill’s appointment was “surprising and good news”.

James Walsh, the NAPF’s international policy lead, said: ‘‘Although issues such as the IORP Directive and holistic balance sheet are unlikely to go away, [the] news makes it much more likely that we will receive the good outcomes needed on these two crucial issues to secure the future of workplace pensions.”

See more at bit.ly/1qinqdl

BREAKING NEWS ONLINE Visit www.theactuary.com for up-to-date news and to register for weekly news alerts

See more at bit.ly/1yjmJL1

Pension reforms pass first hurdle The government’s planned reforms to create new Defined Ambition pension schemes passed their first major test in the House of Commons on 1 September. The Pensions Schemes Bill sets outs a legislative framework for private pensions. After passing its second reading without a division, the legislation will go to committee stage to be examined in detail.

See more at bit.ly/1plpa5w

TPR secures Lehman Brothers pensions payments US investment bank Lehman Brothers, which collapsed in 2008 at the peak of the financial crisis, has agreed to pay £184m to nearly 2,500 former employees to end a six-year legal battle with The Pensions Regulator over pension entitlements. Action was taken by TPR and the pension scheme’s trustees of behalf of the bank’s Britishbased staff.

See more at bit.ly/1rkuGLd

Altmann urges council pension funds to close £50bn deficit Local government pension funds need to work much closer together to close the estimated £50bn deficit across the 89 funds, a pensions expert has said.

Economist Ros Altmann told the London Pension Fund Authority’s annual Fund Member Forum in London that collaboration and partnership could also help address the impact low interest rates and government debt yields are having on deficits. The Department for Communities and Local Government has already set out plans to expand the use of common investment vehicles between funds.

Altmann told the LPFA: “There is a real need for more creative investment solutions, for example, smaller funds coming together with larger funds to invest on a collective, active basis... This will bring benefits in diversification and economies of scale, as well as improved governance and greater expertise.

It will also allow funds to access asset classes such as infrastructure, which deliver long-term returns that match pensions liabilities.”

See more at bit.ly/1plmKnb

Webb lifts NEST savings restrictions Restrictions imposed by the European Commission on the amount that British workers can save towards their workplace pension scheme will be lifted, the pensions minister Steve Webb has announced.

The Department for Work and Pensions confirmed it intends to pass new laws to remove the annual contribution limit and restrictions on transfers into and out of the government-backed master trust NEST (National Employment Savings Trust).

From April 2017, savers will see the annual contribution limit of £4,600 lifted and the ban on individual transfers removed to coincide with the introduction of automatic enrolment.

Webb said this was a “common-sense decision” to help people to save, giving certainty and confidence to employers choosing to use NEST. “By convincing Europe to support us, we’ve achieved a victory for consumers,” he said in a ministerial statement.

NEST was set up by the UK government to support automatic enrolment. The scheme has a public service obligation to accept any worker auto-enrolled by their employer. NEST receives state aid in the form of a subsided loan from the government. The DWP in July last year sought confirmation that removing these constraints was not inconsistent with state aid rules.

See more at bit.ly/ZtXkyE

October 2014 • THE ACTUARY 17 www.theactuary.com

p17_Oct_ind_news.indd 17

23/09/2014 17:00

On my agenda features@theactuary.com

Sweeping

change In light of the major pension reforms introduced in this year’s Budget, Steve Groves, an actuary and chief executive officer at Partnership, speaks to Jonathan Lim about the impact on the UK annuity market and future trends

The Budget announcement in March presented some of the most radical reforms to the UK pensions landscape of the past century. From April 2015, retirees in defined contribution arrangements will face greater flexibility and choice with their pensions. They will be able to draw however much they want from their pension pot, whenever they want, with no obligation to purchase a lifetime annuity.

Steve Groves spoke to The Actuary about the retirement products that he foresees being developed over the coming years in light of this increased flexibility, and why the actuarial profession should be doing more to highlight the increased risk the public will be taking on in retirement.

What impact have the changes in the Budget had on annuities so far?

The annuity market is down by about 50%. As an actuary you have to go beyond that. It’s down 50%, but immediately you ask the question: “What is the other 50% doing?” If you do the analysis you find that, despite a slightly raised appetite for drawdown, most are doing absolutely nothing – just leaving their pension funds invested and waiting until there is clarity on the tax treatment and on the products available. They are either running down other savings and leaving the pension fund, or delaying retirement. I think they are going to work

18

THE ACTUARY • October 2014 www.theactuary.com

p18_21_Oct_interview_groves•SEMIFINAL.indd 18

through until next April and see what they do with the new flexibilities and freedoms. What we are seeing is what I would call “temporary deferral”, because ultimately those people are going to do something, they aren’t going to work forever. We are seeing a very cloudy market at the moment.

Do you think that people will still buy an annuity at retirement after April 2015?

People approach retirement with a fixed pot of assets which they need to last for the rest of their life. An annuity provides that by pooling risk. Under the new rules, if there is a risk you don’t want, such as losing your fund, you can remove it.

For the wealthier customers there is a clear case for not annuitising all your funds at retirement – I’ve always said that. But the vast majority of customers want to maximise their income in retirement and an annuity does this.

For my retirement what would I do? I would cover my basic needs with an annuity. I would want to know that when I reach 90 I will have food to eat and somewhere to sleep. We have got to educate the public to think about annuities more as longevity insurance, and less as a pure investment.

Generally, it is the only asset a customer can buy that will increase in value the longer they live.

With annuity rates being so low, aren’t they seen as bad value?

I think that annuities are a scapegoat for other things. When people receive an annuity quote, for most it is the first time they actually confront the reality of funding their retirement.

At the same time, people look at how much they receive from their annuities and they are disappointed. It is easy to say

SAM PEACH

23/09/2014 16:49

October 2014 • THE ACTUARY 19 www.theactuary.com

p18_21_Oct_interview_groves•SEMIFINAL.indd 19

23/09/2014 16:50

that annuity rates are too low, which is actually not the case.

First, annuity rates are low because fixed interest yields are low, because of public policy: massive quantitative easing resulting in artificially low real interest rates. This is fundamentally a cross-subsidy from savers to borrowers.

Second, people are not saving enough. They have massively under-allocated to their pensions because they have over-allocated to other assets. The money is in property and equity but these assets are not converting to income. In Australia, the average pension pot is about £150,000. In the UK it is about £30,000. It is much easier to say that annuity rates are low than say ‘maybe I should have saved an extra £100,000’. Third, we are simply living much longer.

How do you see the retirement market developing once the reforms have been fully implemented?

In the long-term you will end up with a very structured model. The way I see this developing, based on what happens in the US and Australia, is that advisers will segment people’s needs between the things they cannot live without, for example heating and shelter, and use an annuity or similar guaranteed product to cover that need. Then there is the stuff that they could live without if they had to, but

“I am not going to pull any punches here. I am disappointed by the role the actuarial profession has played in this so far” 20

THE ACTUARY • October 2014 www.theactuary.com

p18_21_Oct_interview_groves•SEMIFINAL.indd 20

would rather not – for example, holidays.

Funds would be put into balanced investment portfolios first. Anything in excess of that will go into a pure risk-andreturn-type field. Over time, investors will run down their balanced investment portfolio and will come to the point where, to sustain their income need, they will have to make a choice: they can either buy an annuity, or they have to cut the things they found desirable but not essential. They will have to make a trade-off between maximising income and retaining flexibility of assets. I think many will switch from the balanced investment portfolio to an annuity, at about age 75, where the cross-subsidy between deceased and surviving policyholders is so valuable. They will invest a significant chunk of remaining assets into an annuity with a degree of protection if they die.

The final solution will not be reached straight away, rather over the next five years. There will be packaged products that can do all this, although I think it will take a long time for advisers to use them.

Do you think the reforms will achieve the objective of increasing retirement saving?

No. I don’t think people will save more for their retirement.

The US and Australia experience says they will be worse off, as 50% of them run out of retirement funds, which doesn’t happen with an annuity. You cannot doubt its popularity with the public and politicians, who welcome the idea of greater choice. But unless you are qualified to understand longevity, investment and inflation risk, it is a choice few are equipped to make. It is rare to come up with a policy that significantly increases tax revenue and is popular with the electorate. This is one of them.

What role do actuaries have in the midst of these changes?

I am not going to pull any punches here. I am disappointed by the role the actuarial profession has played in this so far.

Immediately, people gravitated to thinking we need to tell

SAM PEACH

23/09/2014 16:50

On my agenda features@theactuary.com

customers what their life expectancy is. I think of life expectancy as roughly the point where 50% are still alive.

If people manage to their life expectancy, then 50% will run out of money. Politicians have said we will inform investors about their life expectancies so they can manage to this point. The actuarial profession should be standing up and saying that does not work. The role of a professional should be to look after the public interest and I think the actuarial profession needs to do much more.

What led you to become an actuary and chief executive?

I always liked two things at school: sport and maths. It was quite an unusual combination. I worked out pretty early that I wasn’t going to be good enough at sport to make a career out of it, so I started looking quite hard for how to make a career out of maths. I was drawn to the actuarial profession because of the combination of the mathematical problem solving and the applications thereof. It was a combination of being able to use mathematical analysis and to apply it to everyday practical situations.

Even before I qualified as an actuary, I was moving out of what were considered traditional actuarial areas. My last job as an actuarial student was supervising a derivative trading

operation. My first job as a qualified actuary was as a product and marketing manager. I have spent the majority of my career in non-traditional actuarial areas – product development, M&A, corporate finance, marketing, sales – and tried to see as much as I could of the entire operation of a life insurance company. I also developed a firm belief that you cannot truly succeed without putting the customer at the heart of your business and aligning the interests of the business with the consumer’s. The actuarial qualification was a passport that opened doors.

Being an actuary, I tend to start looking for the answer to what will happen in the future by looking at the data from the past. The further up an organisation you go, the less likely it is that past data will tell you about the future.

The challenges of a CEO are about how markets are going to evolve, how people are going to react, and data does not necessarily give the answer. I often need to remind myself to allow for the human factors. I describe myself as an accidental actuary really. a Steve Groves will be speaking alongside Steve Webb, minister of state for pensions, at the Staple Inn Actuarial Society’s Jubilee Lecture in London on Tuesday 21 October (www.sias.org)

ReMetrica Bringing strategy into focus When it comes to modelling effective financial strategies, ReMetrica transforms your data to help you make insightful business decisions.

Our strategic tool helps reveal potential business outcomes and allows companies to analyse multiple strategies—putting capital efficiency firmly into focus.

Ask for a demo today and inject a little ReMetrica into your business at aonbenfield.com/remetrica_demo

New functionality

Cloud capability for speed and scalability

64-bit processing to easily handle the largest models

TeamCentre for workflow management around the ReMetrica kernel

Empower Results®

October 2014 • THE ACTUARY 21 www.theactuary.com

p18_21_Oct_interview_groves•SEMIFINAL.indd 21

23/09/2014 16:50

Soft skills Report writing features@theactuary.com

Good business communication depends on knowing your goals and connecting with your audience.

Natalie Canavor explains

REPORTING FOR DUTY 22

THE ACTUARY • October 2014 www.theactuary.com

p22_23_oct_softSkills•SEMIFINAL.indd 22

I think you’ll agree with the truism (left) that guides professional communicators. So how can it usefully be applied to writing an actuarial report? You want your readers to: ● read and understand it; ● use it as a basis for good decision-making; ● respect the authority, professionalism and expertise it embodies.

If you agree with these assumptions, taking them into account enables you to avoid the mistakes that many professionals with highly sophisticated technical skills fall into. Such pitfalls typically range from under-supplying clear perspectives and burying readers in detail; using language that is hard for readers to understand; and most risky – delivering the message in a non-engaging manner.

To start with the last point: I realise actuarial reports are not meant to entertain. But in today’s high-pressure environment there are no captive audiences. We all choose what we read, and how much of it to read. This certainly applies to business leaders. The fact that they ask (and pay) for information doesn’t mean they will happily slog through a ton of lifeless material to find what they need and interpret it

GETTY

23/09/2014 17:01

Natalie Canavor is the author of Business Writing for Dummies, a guide to written and digital communication for business people.

She is an adjunct professor at New York University, and has extensive experience as a journalist, magazine editor, corporate communicator and workshop leader

productively. I am sure the substance of actuarial reports isn’t boring to the actuaries who write them. Nor should it bore their audiences. Fortunately, some techniques borrowed mostly from journalism and a smidgeon from psychology can make your reports at once more interesting, clear, readable, useful – and valued.

Staying tuned Especially when massive amounts of data are involved, it is easy for readers to get lost in the maze.

People today don’t want more information – we all feel overburdened already. We want to know what it means. It’s the writer’s job to predigest the information and develop a clear perspective based on what matters to that audience.

Journalists, who are also information gatherers, always ask themselves ‘What’s the story?’ It can be far from obvious, especially when a lot of research is involved.

And often the original idea or expectation evolved into something quite different.

Reporters have a maxim for reminding themselves how critical it is to find the focus: ‘Don’t bury the lead’. That means know what’s important, interesting and valuable about your message to the reader, begin with it, and organise the rest of your report to support it.

To find the lead for an actuarial report, try telling your ‘story’ to someone else, or imagine doing so. You might ask yourself ‘What is this really about?’, ‘What did I find?’ or ask and then answer the question that your readers hired you to answer, such as ‘What does the evidence indicate to be the best decision?’ or ‘What are the alternative courses of action and what are the risks and benefits for each?’.

It can work magically to hear yourself explain the basic story line to someone who is not a technical professional – either a partner, or a bright 18-year-old. There’s actually a neuroscientific reason for this strategy: we use different parts of the brain for writing and oral communication. When we write, we express things in very complicated ways – and the more so with more education. Saying something gives you access to a communication system much older than writing. It helps you drill to the core of your message and also state it in

more direct, simple language.

Once you know your story, tell it in the executive summary. This crucial part of your report should offer a complete perspective on what’s in the report, what’s important, and your recommendations or conclusions. Your readers want a rational basis for decision-making. Your goal is to deliver that. This makes giving them the bottom line your most captivating lead.

Even more important, realistically, many readers will make decisions after reading only the executive summary. Make sure it gives them a solid foundation to act upon.

View the rest of the report as evidence and backup. You can cross-reference sections within the executive summary, so people can find that detail according to their own interests. That doesn’t mean bogging those sections down with all your research and analysis. A report works best when relatively non-technical readers can move through it quickly without becoming embroiled in too much data they probably won’t understand or care about.

The bottom-line-on-top strategy works for all a report’s sections, as well as the executive summary. For each one, begin by figuring out the main import of the material and put it in a clear perspective. Don’t slow down or interrupt the narrative flow with too many calculations, charts, graphs or other ‘evidence’. Most readers do not care how you arrived at conclusions or the process you used. They care about what it means to them.

Here’s a quick formula for an effective report: present it as three stages – executive summary/ overview, main body spelling out major findings and implications, and a set of appendices with all the data you – and fellow actuaries – could want.

Using writing to engage It might surprise you to know that while writing is generally seen as a ‘soft skill’, helpful guidelines exist based on how well audiences can understand it. Here are a few ‘shoulds’: ● sentences: between 10 and 18 words on average; ● paragraphs: one to four sentences each; ● words: as many one-syllable ones as possible.

Easy to use readability predictors are found on your Microsoft Word programme. Just check ‘show readability statistics’ under preferences/ spelling and grammar, and the Flesch index, or readability index, shows up after you use spellcheck. The box tells you what percentage of people will understand a piece of writing, the percentage of passive voice sentences and more. Many professional writers routinely

check their work against these stats, and rewrite when the passive count, sentence length and so on are too high.

You may take these guidelines with as many grains of salt as you like, but they are audiencefocused and thus illuminating. No one today likes to read material that needs to be deciphered. The most effective business writing today reads easy and fast. The easier and faster a report reads, the more of it will be read and absorbed as you would like.

Using a high percentage of one and twosyllable words is best because we human beings like short, concrete words. Perhaps because they derive from Anglo-Saxon, as opposed to the French and Latin imposed by conquerors, they promote credibility and trust. They resonate with us. Think of Winston Churchill’s speeches or poetry like Emily Dickinson’s.

A sprinkling of longer words is all the more effective when the base consists of short ones.

Using heads and subheads To dip into the journalist’s bag of tricks again, use ‘action’ headlines and subheads that say something, rather than labels.

Instead of writing, for example, ‘Pension fund forecast’, try ‘Pension funding inches up’.

Or, use the label and add a headline: ‘Pension fund forecast: 14% rise seen for first quarter’.

This technique automatically makes the material more interesting and does a better job of capturing reader attention. Being more specific helps people identify the must-read pieces, too – and this is good.

Today’s reader, trained by the internet, is active rather than passive. We are selective about what to read and specific subheads help us make good decisions about what is relevant to our interests.

Apply this idea to headlines as well. Rather than just writing ‘Executive summary,’ base a headline on the actual content. For example, ‘Executive summary: three routes to funding pensions to meet new legal guidelines.’ Good headlines and subheads set up your reader to receive the information, and make organising your own thinking much easier.

In summary, remember who your audiences are: busy, practical, pressured, bottom-linefocused specialists of different kinds, with varying degrees of technical proficiency and interest. Give them reports that reflect the value of your information with clear writing that doesn’t get in the way of understanding. Put the data in perspective for them. You will find grateful clients who use your results to achieve their goals. a

October 2014 • THE ACTUARY www.theactuary.com

p22_23_oct_softSkills•SEMIFINAL.indd 23

23

23/09/2014 17:01

Finance and investment Long-dated loan markets features@theactuary.com

p24_26_oct_banking•SEMIFINAL.indd 24

23/09/2014 15:46

ALEC INNES is managing director

and head of relationship solutions and ALBERT SHAMASH is managing director,

relationship solutions, with Lloyds Bank Commercial Banking. STEPHEN BIRCH is a partner and ROSS EVANS a senior insurance consultant at Hymans Robertson

Alec Innes, Albert Shamash, Stephen Birch and Ross Evans explore the benefits and challenges of collaboration with a bank for an insurer to gain access to long-dated loan markets

NEW ROUTES TO MARKET In recent years the low interest rate environment and regulatory change for both banks and insurers has seen increased interest and investment by insurers in illiquid debt. This includes – but is not limited to – commercial real estate, infrastructure, social housing and education loans.

Favoured investments have, to date, tended to be longer-dated and investment grade quality senior loans, used primarily alongside corporate bonds and gilts to back fixed-rate UK annuity liabilities.

Insurer demand has been driven by three main factors: the illiquidity premium, favourable capital treatment versus corporate bonds, and the additional diversification as part of an overall portfolio investment strategy. As insurers develop additional experience and expertise, it seems likely that their use will be extended to other parts of their balance sheets. For example, shorterterm lending could act as an attractive equity substitute within with-profits funds.

We believe that the demand for illiquid lending will remain strong among insurers in the coming years. Although new business volumes have been falling in the individual annuity market since the 2014 UK budget, the demand for additional yield to capture market share and to back other types of insurance

JAMES DAWE

p24_26_oct_banking•SEMIFINAL.indd 25

liabilities, not least defined benefit bulk annuity deals, will remain significant.

In addition, insurers are beginning to gain clarity on the application of the Solvency II restrictions – in particular those relating to the need to have fixed cash flows in order to gain ‘matching adjustment’ treatment.

Practical solutions to the regulatory regime are now becoming established, from reconfiguring loan terms for new origination, through to structured overlays on existing loan portfolios, passing on pre-payment risk to other entities or parts of the balance sheet.

As a result, we expect continued significant demand for illiquid debt in 2015 and beyond.

Accessing the market Once insurers have decided on the strategic merit of an allocation to illiquid lending, they need to consider the practical options for accessing the market.

Although bank back book assets do become available from time to time, for most this channel is unlikely to be practical. Banks will often be reluctant to accept the discount-topar value that selling at current market pricing might imply. Secondly, the characteristics of historic loan books are often idiosyncratic, complex and varied, with a range of different pre-payment rules, credit quality, floating

October 2014 • THE ACTUARY www.theactuary.com

25

23/09/2014 15:47

Finance and investment Long-dated loan markets features@theactuary.com

rather than fixed rates and covenant terms.

These are often not in line with the preferred characteristics of insurers, making large-scale ‘whole portfolio’ purchases difficult. Instead, insurers are more likely to succeed in gaining exposure through new loan origination, according to terms which they know suit their needs. To date, most UK insurers have tended to focus on two, reasonably well-established models.

First, using third-party asset managers, which may be within the investment management division of another insurer. This has been the most common route for those insurers without the desire or scale needed to lend directly.

The third-party asset manager will take responsibility for sourcing, originating and subsequently administering and monitoring the debt, with differing degrees of discretion and need for sign off on individual loans from the insurance client’s investment and risk committees.

Second, building their own origination teams and expertise. Larger insurers can lend directly and maintain these lending relationships on an ongoing basis. In some instances, the economics and costs associated with building an internal team have been supported through an effort to win third-party assets from other insurers and institutional clients.

Both models have been used successfully and it seems likely that they will continue to form the basis for many firms in accessing the market. Own origination requires the greatest investment into in-house expertise and is typically only possible for the very largest insurers. Using an asset manager provides the easiest access to these asset classes, but management fees will reduce the available illiquidity premium.

The most common challenge has probably been one of restricted deal flow, with a number of institutional investors being frustrated at the time taken to originate debt at a time when margins have been on a downward trajectory.

Much of the delay has been associated with the market having to respond to a new environment in which banks have not been as willing to lend on their balance sheets.

Borrowers have had to get comfortable with new sources of capital and lending relationships, and the insurers have had a steep learning curve in understanding what flexibilities and timescales are involved in signing off deals.

A third option?

A third route, yet to become fully established, is to enter into a preferred partnership with a

26

THE ACTUARY • October 2014 www.theactuary.com

p24_26_oct_banking•SEMIFINAL.indd 26

Banks, however, have different fears. ● The insurer’s governance processes will

commercial bank. In theory, this approach can offer mutual benefit to all parties. ● The insurer gains access to the bank’s established network of historic borrower relationships, in addition to its practical experience in lending into these sectors over many years. The bank could also service the loans post-origination. ● The bank maintains its relationship with borrowers, using the insurer’s capital for longer-term lending while providing its client with other, shorter-term banking services. ● The borrowers place value on having a single source of financing for their different short and longer-term needs, while maintaining their ongoing relationship with the bank.

Importantly, the bank does not act as the fiduciary with discretionary responsibility for managing the assets. The insurer will need to sign off or approve individual loan assets at the point of origination, as well as monitoring the credit quality of the assets over time.

Some internal resource and expertise will therefore be required to supervise the investment programme – as such, this model is likely to be most viable only for the larger insurers. Preferred partnerships will only work if both parties can identify and address concerns and conflicts of interest upfront.

Insurers have three typical concerns. ● Banks can be motivated by volume rather than price. This is a key concern in an area in which competitive or ‘market’ pricing can be opaque. ● They may suffer from ‘adverse selection’, where the bank passes on or sources deals which are sub-optimal from the insurer’s perspective, based on the bank’s wider commercial interests. ● The bank might not remain fully committed to the sector over the long-term, which may prove troublesome if other servicing agents need to be found at a future date.

unduly interfere with their ability to lend and ultimately damage borrower relationships. ● They need to protect competitively sensitive commercial information, such as the terms offered to borrowers from rival lenders and banks. ● They need confidence that the insurer will not disintermediate them in the future and that any partnership agreement does not cannibalise their other business such as bond origination or private placements and securitisation.

These legitimate concerns need to be managed and are best mitigated through upfront discussions. We can group potential solutions into four key areas.

1. Getting the right incentive structures in place. For example, it may be possible for banks to charge origination fees over the life of a loan, by taking a proportion of the loan margin, rather than charging upfront fees.

2. Offering appropriate levels of transparency.

Defining carefully the parameters the insurer is looking for enables the bank to target lending opportunities that meet these requirements and reduces the risk of adverse selection. This must also be flexible enough to adapt to continually changing market conditions.

3. Sorting out the key operational procedures, from early stage loan evaluation through to eventual funding upfront. This reduces the potential for unintended delays and aborted loan negotiations with borrowers.

4. Having a back-up plan. For example, outsourced loan servicing companies are available, should the bank withdraw from providing this service.

New routes The market for private debt is undergoing significant change as the providers of funding for vital longer-dated debt shift from the historic banking base, towards other institutional investors.

Many insurers remain at a relatively early stage of evaluating the different routes to market, although, for most, using a thirdparty asset manager will remain the most viable option.

However, larger insurers might want to consider entering into partnerships with banks in order to access their historic borrower networks and sector expertise. This will require a concerted effort to address and mitigate the different concerns and conflicts of interest upfront. The prize is improved access to deals and a scalable, repeatable process for different segments of the market. a

JAMES DAWE

23/09/2014 15:47

Appointments

IMAGINE: CONFIDENCE IN THE NUMBERS.

Introducing Arius,™ the state of the art in reserving solutions.

Designed from the ground up by Milliman, Arius delivers proven innovations like deterministic analysis combined with advanced variability models, all in a customisable work environment. The bottom line? A better understanding of your numbers, and smarter business decisions. So say goodbye to patchwork solutions, and hello to Arius.

Milliman.com/Arius

4

THE ACTUARY • May 2013 www.theactuary.com

p27_ACT.10.14.indd 4

19/09/2014 15:34

Careers Non-executive directorship features@theactuary.com

ACTUARY ON BOARD In the first of a series of articles on the role of an actuary as a non-executive director, Colin Czapiewski covers some of the practical issues faced by non-executives in a rapidly changing boardroom environment

28

THE ACTUARY • October 2014 www.theactuary.com

p28_29_oct_non_exec•SEMIFINAL.indd 30

There are relatively few actuaries who are listed as non-executive directors on boards of UK companies. Of those who are, most serve on boards of insurance companies or other financial institutions. However, experienced actuaries often have a considerable amount of the skills necessary to perform the role of an independent non-executive director to a high standard. There is no reason why less experienced younger actuaries cannot also contribute to the efficient running of an assortment of companies.

Actuaries perform much of their work in the pensions, life and non-life insurance and investment sectors. However, a growing proportion of work is in respect of businesses outside these areas. Many actuarial techniques and approaches are transferable to other fields, and can bring a refreshing new way of looking at often longstanding industry problems. Actuarial skills can be useful and applicable to problems experienced elsewhere and can be taken into the boardrooms of a great many companies.

The days of an elderly, retired executive

GETTY

23/09/2014 17:02

“The days of an elderly, retired executive management team having pleasant meetings with a lunch afterwards are long gone” Code, published the consultation document in its two-yearly review of changes following earlier consultations.

The Code can be traced back to the Cadbury Report in 1992, which established a code of best practice for UK companies. It has been developing ever since and is currently divided into three areas: main principles, supporting principles and provisions. The main principles comprise: ● leadership – the role of the board, division of responsibilities, the chairman, and nonexecutive directors; ● effectiveness – the composition and appointments of the board, commitment by directors, the development of directors, information and support, evaluation, and re-election; ● accountability – financial and business reporting, risk management and internal control, the audit committee and auditors; ● remuneration – level and components, and procedures; ● relations with shareholders – dialogue, constructive use of the AGM. Interested readers should delve more deeply by visiting the FRC website.

In practice management team having pleasant meetings with a lunch afterwards are long gone.

Non-executive directors now have a much tougher time and need to keep pace with the regulatory requirements. In the insurance industry, the Solvency II implementation exercise is certainly keeping non-executive directors on their toes, and life is not getting any easier on the governance front.

Governance Before accepting a position as a non-executive director in the UK, it is vital to take time to read and understand the UK Corporate Governance Code, which sets out standards of good practice.

Although the Code is primarily meant for listed companies, it is generally recognised as being applicable as best practice to all UK companies.

In addition, it gives a soon-to-be-appointed non-executive director some good pointers, such as ensuring she or he asks why their predecessor left.

In April 2014, the Financial Reporting Council (FRC), responsible for producing the

This all sounds rather routine, possibly boring, theoretical and irrelevant. After reading the Code, it is difficult to see how it would be useful in practice. However, when you have some experience serving on a board and its various committees as a non-executive director, it is much easier to see just how important and relevant the Code is, and how problems could so easily emerge if such procedures and approaches were not in place. Running a successful and robust company nowadays is no easy task with so many demands and targets that may often seem to conflict. Of course, in the insurance industry, there is Solvency II, and so much of the Code is entrenched in the doctrines of this EU directive and the abundance of work involved in its implementation.

decisions, questioning rather than doing, being hands-off for much of the time when you feel that it would be more efficient to be hands-on. It might be seen as being a grandparent rather than a parent, albeit with statutory responsibilities.

Although you have to stand back, you must always be ready to step in when necessary, so a good working relationship with executive management is important. You may have some suggestions and guidance for the day-to-day tasks, but your role is more long-term.

The breadth of the role of a non-executive director differs from that of a member of the executive management team. Executives will have detailed and specific terms of reference, especially under Solvency II, in a relatively limited and confined role. However, the non-executive director must be involved everywhere and have a much broader level of knowledge, although she or he must know where and when to seek assistance and information from the executives operating within the company.

One day you may be asking the compliance officer about some sanctions issues, the next assessing the five-year business plan, then reviewing a response from the managing director to the regulator and finally, in your role as chair of the risk committee, commenting on the proposed revised parameters for the risk metrics within the risk appetite.

Rewards Compared with the rewards as a senior actuary, non-executive directors receive a relatively poor rate per hour. However, there is no routine work, the breadth is immense and the satisfaction can be significant when all goes well. a The full UK Corporate Governance Code can be found at bit.ly/WI3SrF There is a LinkedIn group for actuary non-executive directors at linkd.in/1BP6DqU The Worshipful Company of Insurers offers an information bank at bit.ly/YUBi8m

Executive or non-executive?

After working in an executive capacity, making day-to-day decisions, it is surprisingly hard to adapt to a non-executive role quickly. As a non-executive, you are not doing the work or making the decisions – that is the role of the executive management team. Your responsibilities are totally different – longer-term planning, making strategic rather than tactical

COLIN CZAPIEWSKI

is an independent actuarial, insurance and risk management consultant

October 2014 • THE ACTUARY www.theactuary.com

p28_29_oct_non_exec•SEMIFINAL.indd 31

29

23/09/2014 17:02

Pensions Longevity risk transfer features@theactuary.com

the

TIPPING POINT?

It has been a busy year for longevity swap transactions.

Martin Lockwood asks whether capacity in this market has now been reached, and shares his thoughts on how UK pension schemes can prepare for such transactions Longevity swaps have become an increasingly standard mechanism for pension schemes to transfer longevity risk to the insurance market.

These swaps have been used by UK pension schemes over the past five to seven years and around £45bn of liabilities have been written to date. The recent growth in this market is illustrated in the graph top right.

There are several ways in which the longevity risk of a defined population can be transferred from a pension scheme to another party, however one dominant model has appeared in the market. Typically, the risk is passed from the scheme onto an intermediary

30

THE ACTUARY • October 2014 www.theactuary.com

p30_31_oct_tipping point•SEMIFINAL.indd 30

– an investment bank or insurer – in the form of a longevity swap, or through the purchase of a buy-in or a buy-out contract with an insurer.

More often than not, the insurer then passes the longevity risk onto reinsurers, either as part of the same transaction or at a later date in combination with other deals.

Why has this model become dominant?

This longevity swap model requires the engagement of multiple parties – advisers, insurers, investment banks and reinsurers – in order for the deal to transact. Given that these

GETTY

23/09/2014 15:47

Figure 1 UK longevity reinsurance transaction activity over the past five years 301 25 20 £ Billions

“The market as a whole has high aspirations to grow much larger as a greater understanding of longevity swaps is achieved”

15 10 5 0

2010

2011

2012

2013

2014 SOURCE: MUNICH RE

parties are specialists in different fields, why has this model become the default option?

The attitude towards longevity risk of the two main types of intermediaries is broadly aligned, that is, longevity risk is generally only manageable at lower levels, and so when large longevity deals are written the risk is often passed on. This mechanism is required in order to make writing longevity deals a sustainable business line.

In the main, it is the reinsurers who take on this risk, but while insurers dealing with reinsurers is an obvious relationship, why do investment banks engage with reinsurers?

Why not pass the longevity risk through their more conventional channels directly to the capital markets instead?

From the reinsurers’ perspective, writing longevity business provides two benefits: some potential financial return, and more importantly, a hedge against adverse experience in existing lines of mortality business, such as life insurance. While the hedge isn’t perfect due to differences in the profiles of the two business lines, longevity swaps make a valuable contribution to the sustainable risk management of reinsurers.

From the capital markets’ viewpoint, only financial return is of interest; for most investors, the hedge is irrelevant, as they do not have portfolios of mortality risk.

However, at current pricing levels, the financial returns are not sufficiently attractive, particularly when you factor in the long duration of longevity business.

Consequently, it has been the reinsurers, rather than the capital markets, who are the ultimate bearers of most longevity business.

Can longevity swaps continue working in this way?

This has been a ground-breaking year for the longevity swap market, not least because of the scale of the deals that have been written so far – in excess of £20bn to date – and the size of the individual deals.

Has 2014’s heightened activity resulted in a capacity crunch for the rest of the year? Or does it indicate that the longevity market is ready to take on more and bigger deals? The answers to

these questions depend on a number of different factors.

Prudent risk management: the survival mechanism of the reinsurance market Reinsurers are prudent organisations that, while happy to do deals, generally prefer to avoid large concentrations of risk. We have seen this in recent transactions, where most deals in excess of £1bn are often broken up into smaller chunks to make it easier for insurers and reinsurers to write the business.

The BT Pension Scheme deal in July this year, where Prudential US took on £16bn in one go, bucked this trend. However, this appears to be an exception, and the way forward for the UK market looks to be through spreading risk rather than concentrating it.

A key influence on capacity is the hedge that longevity risk provides against existing mortality business. However, as reinsurers write more and more longevity business, the capacity to hedge this risk will be diluted, and so appetite to write new business will reduce.

So far, this has not yet emerged, and the longevity market is still buoyant, but, at some point in the future, reinsurers’ capacity to write business and the value drawn from it will be affected.

Solvency II: a threat to capacity?

Those looking to transact should also be mindful of the imminency of Solvency II and the impact that that will have on the reinsurance market as a whole, not just for longevity business.

Solvency II is likely to increase the value to insurers of passing on risk to the reinsurance market as well as having an impact on reinsurers’ reserving requirements. Insurers are likely to look to pass on longevity risk from historic annuity policies to reinsurers, which may well serve to suppress reinsurer appetite for pension scheme longevity risk.

Experienced teams are in demand Longevity deals are complicated, high-profile deals, and while they may be high value, they also tend to be few and far between, with the market often being described as ‘lumpy’.

As a result of this, many organisations have been reluctant to build large teams that would not be fully utilised all of the time. The upside to this is that it saves costs, but the downside is that there is a limit to the number of deals each team can take through to the execution phase in parallel. In the end, this resource constraint means that reinsurers have to pick which deals to pursue, and only sufficiently desirable deals will actually reach completion.

Has the market reached its tipping point?

In the short term, there is appetite within the current market for pension schemes to pass on their longevity risk. Indeed, the market as a whole has high aspirations to grow much larger as a greater understanding of longevity swaps is achieved across pension schemes, benefit consultancies and the insurance industry. However, the reality is that the market may reach tipping point soon at current pricing levels, and it is likely that while the market will still grow, it may be at a slower pace than some may hope for.

So what does this mean for pension scheme trustees? Appetite within the longevity market is likely to reach a plateau over the next few years, and so intermediaries and reinsurers will be able to be increasingly selective regarding the schemes with which they transact.

One thing to be mindful of is that while the pension scheme may not be looking to deal directly with a reinsurer, it is the reinsurers who ultimately determine the capacity within the market, along with the associated supply and demand impacts that are likely to follow. a

MARTIN LOCKWOOD

is head of longevity reinsurance at Munich Re UK & Ireland Life

October 2014 • THE ACTUARY www.theactuary.com

p30_31_oct_tipping point•SEMIFINAL.indd 31

31

23/09/2014 15:48

Spotlight Worshipful Company of Actuaries features@theactuary.com

CHARITABLE EFFORTS Bill Smith highlights the work of the Worshipful Company of Actuaries and summarises some of its key initiatives

The Worshipful Company of Actuaries

(WCA) is one of over 100 livery companies of the City of London.

It was established in 1979 and currently has over 240 members. Any actuary is welcome to apply for membership.

The principal activities of the WCA are raising money for its charitable trust and, in having strong ties with the Corporation of London, contributing to the City of London. This is all underpinned by its support for the actuarial profession and for mathematics education in general.

The latest WCA initiative recently announced is a three-year sponsorship of the Mathematics Masterclass Programme run by the Royal Institution in the UK. This programme consists of hands-on and interactive extracurricular sessions led by top experts from academia and industry, aimed at keen and talented young people all around the UK. The WCA’s sponsorship will double the number of students in London who have access to this programme. It is just one initiative among many others.

Andrew O’Brien, winner of this year’s Phiatus award for his 12 marathons in 12 months, raised £10,000 for the ISIS Foundation, a charity dedicated to improving lives in Nepal and Uganda

Maths education Over the past five years, the WCA has sponsored a major study by The Royal Society on the benefits of mathematics education for non-mathematical students. The results of the study will be published shortly and are expected to help increase the priority of mathematics in the school curriculum.

The WCA also supports the mathematics education project at Reed’s School in Surrey, and has been involved in finding volunteer actuaries to help on the Business, Enterprise and Employability Programme in schools, which is led by the Tower Hamlets Education Business Partnership. We are delighted to have Trevor Watkins, director of education at the Institute and Faculty of Actuaries (IFoA), on the WCA’s education committee.

Developing actuaries in Ghana In 2013, the WCA provided financial support for the

IFoA’s fact-finding trip in supporting the education of actuaries in Ghana. Subsequently, a number of actuaries have visited the country to deliver lectures to actuarial students in university there.

Phiatus award This is an annual award, now in its third year, for an actuary who has made an outstanding contribution to charity. This year’s winner was Andrew O’Brien (left), who in May completed 12 marathons over 12 months, raising over £10,000 for the ISIS Foundation, a charity dedicated to improving health and education in Nepal and Uganda.

The City of London Each year, a lunch is arranged for the incoming Lord Mayor and the president of the Institute and Faculty of Actuaries.

Over time, this has assisted the IFoA in its overseas activities, especially in the Far East.

Social activities Actuaries are allowed to have fun, and we have a number of meetings throughout the year to which we invite all members of the profession. The ten-pin bowling tournament in March and the Master’s Golf Day in June are two good examples. Receptions and dinners in the City take place in many of the finest livery halls. This includes our annual dinner with the Lord Mayor at Mansion House.

Charitable trust The WCA’s charitable trust sponsors bursaries and prizes in actuarial exams – 24 bursaries and seven prizes were awarded last year. The charitable trust raises close to £200,000 each year and benefits from the efforts of many actuaries in its fundraising activities.

In September 2010, in conjunction with The Actuary, we set a target for the actuarial profession to raise £1m over five years and this was achieved earlier this year, ahead of plan. Since this initiative was launched, there has been a substantial increase in the number of the charity and fundraising efforts by actuaries, highlighting the sig signifi cant work being done across the profession.

F For details on the Company, or if you are considering ap applying for membership, please visit our website ww www.actuariescompany.co.uk

B BILL SMITH is chief executive officer at Lazard Asset Management and was Master of the WCA in 2012/2013 M

32

oberr 2014 obe 2014 THE ACTUARY • October www.theactuary.com

p32_OctoberWCAspotlight•SEMIFINAL.indd 32

23/09/2014 17:05

BOOK REVIEW

Seeing What Others Don’t: The remarkable ways we gain insights by Gary Klein PUBLISHER: Nicholas Brealey Publishing ISBN-10: 1857886194 RRP: £12.99

“This is a subtle call to be mindful about what is happening around us and to stay curious and broad-minded” This book is a timely contribution to a growing list asking professionals to think radically about the way they work. The beginning is enticing, peppered with several stories about the development of individuals’ insights. The ending is a useful summary of the key points and evidence of the intervening chapters.

Numerous examples of insights, strategies for gaining them, and the reasons why they get stifled at both individual and organisational levels, are effectively covered. Klein’s incorporation of psychoanalysis, traditionally the domain of insights, and positive psychology – a strengths-based model for understanding behaviour – provide a holistic framework for advancing his ideas.

While the book’s call to action could be stronger, for those who want to improve their personal and professional performance, it is a subtle call to be mindful about what is happening around us and to stay curious and broad-minded. Klein makes a good case for taking responsibility for shifting our way of seeing one another, our organisations and ourselves.

Klein explains insight as the discovery of new patterns, in contrast to intuition, which he defines as the use of patterns that have already been learned.

Right from the beginning he shares samples from his

GETTY

p33_oct_book_review•SEMIFINAL.indd 33

collection of diverse stories leading to his study. The reader quickly grasps the practicality and impact that can be attained from the realisation of insights.

Klein incorporates insight into an equation: Performance improvements = Reducing errors and uncertainty + increasing insights

We tend to look for ways to eliminate errors, but this does not equate to the creation of insights. In fact, expending too much energy on eliminating mistakes could actually hinder their formation. He found that insights involve changing core beliefs held, leading to abandoning or replacing initial beliefs. An example of this is Harry Markopolos examining Bernie Madoff ’s investment returns, and immediately recognising that the “numbers made no sense”. Eventually, Madoff ’s Ponzi scheme came to light, years after Markopolos had tried, in vain, to convince the relevant regulators of his suspicions of fraud.

Klein initially comes up with five strategies for gaining insights: connections, coincidences, curiosities, contradictions and creative desperation.

He later formulates a ‘Triple Path Model’, which is a regrouped set of three strategies: contradiction (finding an inconsistency); connection, which includes coincidences and curiosities (spotting an implication);

and creative desperation (escaping an impasse).

Each strategy leads to different activities. As a result, this alters our understanding and how we then act, as well as how we see, feel and desire changes.

Klein says there are four reasons for stifled insights: flawed beliefs, lack of experience, a passive stance and concrete reasoning. By highlighting the difficulties with gaining insights, he acknowledges that it is possible to come to erroneous conclusions that may feel like enhancing insights. There are limitations of data and testing; therefore, caution has to be exercised in how much to trust the available data. This must be balanced with not discarding anomalies and outliers that may, in fact, be the most important data points.

Finally, Klein touches upon how we can foster insights. After building such a compelling case for the development of insights, Klein’s call to action could have been stronger here. He has a few suggestions based on the strategy groupings he describes earlier.

Klein questions the benefit of listing all assumptions and analysing work in great detail.

Actuaries may wish to disagree with this assertion as we recognise the value of detailed work. Klein talks about “the pause that refreshes”, as in the value of incubation in letting the subconscious mind work by taking a break from focused mental effort on one problem.

The increasingly complex, competitive and rapidly changing business environment requires an organisation to manage its risk while remaining competitive. Klein discusses traps that obstruct insights in organisations: predictability trap, perfection trap, and the Einstellung effect (negative effect of previous experience and habit).

A valuable point Klein makes is around being careful not to edit or dismiss an employee’s insight at early review stage, thus losing it for others’ consideration.

He suggests an oversight group could be set up to have transparent discussions on insights and decide which ones to pursue, rather than an employee’s proposal being rejected early on by an especially risk-averse manager who wishes to maintain the status quo. ● Rani Pooran is a senior manager in PwC Canada’s consulting business. Sonal Shah is a freelance actuary specialising in Solvency II documentation.

A more detailed review is available online

MORE ONLINE Latest reviews at www.theactuary.com/opinion

October 2014 • THE ACTUARY www.theactuary.com

33

23/09/2014 15:48

At the back Coffee break

Nylfia is an actuary who solves and sets cryptic crosswords created especially for The Actuary

puzzles@theactuary.com

Puzzles

— RD SWO CROS IZE PR E PUZZL

For a chance to win a £25 Amazon voucher, please email your crossword solution to: puzzles@theactuary.com by Wednesday 22 October

—

Across

BRIGHT LIGHTS, BIG CITY It may not sleep, but it does age and 2014 is the year to celebrate its 350th birthday...

1

2

3

4

8

5

6

7

9

8 See 7 9 Toothless performance of attendee (8) 10 American girl takes fashion from high street (8) 11 Oxygen provided during rehab treatment, firstly (6) 12 Lash out at Nick (5) 14 Body merged from flawed concept leadership embraced! (7) 17 Utensil for melting adhesive let go up in flames (7) 18 Alternative heart treatment with rejection taken into account (7) 21 Line of cash used on rail outing first person mentioned? (7) 23 Supporter leading quiet forward (5) 26 Subject taking right line (6) 27 Writer has stagger when drink taken outside (8) 29 Approval expressed by judge on pick up (4,4) 30 Storm is rare in mountains (6)

Down 1 2

11

10

3 12

13

14

4 15

16

5 17

18

19

6 7,1

20

21

22

13 15

23

24

25

16 26

27

28

19 20 22

29

24 25 28

© Nylfia 34

30

Benitez backed from a distance (4) Parking space found in anger in City, every day? (3,5) Phillips’ words at the altar, “What’s up, leaders”? (5) Theme has Duke disposed of for period in time of resolution (3,4) Actor, Gibson, has argument about old city – one in Australia (9) Setter fabricated consensus view (6) Emotional condition of most defiant lunatic (5,2,4) Rampart renewal lost focus (4) Measure wind device used for adjusting level (9) First person in Paris with good man turned up in floods (4) Something causing apprehension had other beheaded with Brook involved (8) Range where hens lay (7) Part-time worker loses head with rage in organisation controlled by one person (6) Naive about inside information (5) Head first and consequently body (5) Standard – grand made as deposit (4)

THE ACTUARY • October 2014 www.theactuary.com

p34_35_oct_crossword_puzzles•SEMIFINAL.indd 34

23/09/2014 17:04

5

9

5

1

1 8 7 7 2 4 4 5 6 3 5 2

HAVE YOU GOT WHAT IT TAKES?

2 6 3 ?

For information on IQ testing in your area, visit www.mensa.org.uk

—

A MENSE PRIZ E PUZZL

Flower power Mensa puzzle 603

Bridge puzzle 47 Preferential treatment

—

What number should replace the question mark (above)?

You are South and hold: TERMS AND CONDITIONS The prize will be awarded for the first correct entry drawn at random from those received before the closing date. The winner’s name will be announced in the next edition. Please note, the puzzle editor’s decision is final and no correspondence will be entered into. We reserve the right to feature the winner’s name in The Actuary. Your details will not be passed to any third party in connection with this draw.

Tourist teaser Mensa puzzle 604

♠ 862 ♥ KJ652 ♦ Q8 ♣ Q64

The bidding has been: (a) East West (b) East West 1♠ 3♠ 1♠ 2♣ 2♦ 4♠ 4♠ In each case put these leads in order of preference: (i) A spade (ii) 5♥ (iii) Q♦ (iv) 4♣

♠ 9852 ♥4 ♦ AK108 ♣ 7432

This time you hold:

The bidding has been: East West 1♠ 2♣ 3♥ 3♠ 4♠ Put these leads in order of preference: (iii) A♦ (iv) 4♣ (i) A spade (ii) 4♥

Rearrange each of the following to give a world-famous landmark. What are they?

a) BIGHEARTED GENTLE DOG b) SOME HOT CLUES c) EASY SPEEDY HONOUR

Bridge puzzle provided by David Lampert

Symmetrical endings Mensa puzzle 605

A button undone Mensa puzzle 606

Can you find two words that begin with

What letter should replace the question mark?

A

F

H

and end with

L SHUTTERSTOCK

p34_35_oct_crossword_puzzles•SEMIFINAL.indd 35

E

T

M

V

?

October 2014 • THE ACTUARY www.theactuary.com

35

23/09/2014 17:05

1

2

S

3

D

4

L

7

S

K E

A R Y

E

N L A M M O R A

L Y A A C

L C I

L E

I

E

S A B O

10

F A

16

I

W

♠ K8 ♥J93 E ♦ AJ ♣ KJ10986

S

East

1♣

1♦ (1)

1♠

2♥ (2)

3♦ (3)

5♣ (4)

6♣ (5) (1) Invented bid, as mentioned above.

(2) Fourth suit forcing, asking for more information. In particular, East is looking for a heart stop so that 3NT can be bid.

(3) No heart stop but three of Partner’s (assumed) suit!

(4) With Partner having bid clubs, spades and providing diamond support, East, holding K♠, can safely bid 5♣. If East can read West for a singleton heart (possible on that bidding), then East could risk 6♣. My preference is for 5♣.

(5) With good spades, the K of Partner’s (assumed) suit and specifically the heart singleton, West should bid 6♣.

Did you get to 6♣? If so, you would have earned yourselves a Top on this board. Everyone was in 5♣, making twelve tricks!

E R O

17

S S

A R M

A

15

T

E

18

C E N L N A D E S U

22

14

F

L

U N E

I N

T

S I

L O G O

I

C S

23

C O H L

A N N

N F

O R M A I

20

T A D O S R S S

24

T O G L R E

I A T P O

T

I O

26

I

A N L

C O C O O N D L S A MENSE PRIZ E Z PUZ L

—

A quote by Benjamin Franklin has been split up into groups. Rearrange the groups to form the quote. What should it say?

ANSWER Anger is never without a reason, but seldom with a good one Congratulations to this month’s winner – Jennifer Wall

ANG HOU TAR

2. What do you suggest East does bid? An immediate bid of 3NT is dangerous because of the heart holding. You need to ‘invent’ a bid.

I would bid 1♦.

West

A M E T N

—

1. What mustn’t East bid? Any level of clubs. 2♣, 3♣ and 4♣ are limit bids and could be passed.

5♣ is a Game contract but in Pairs, 3NT should be sought before settling for a minor suit game.

4. How do they get there? My suggested sequence is as follows:

A Z E

Founding father Mensa puzzle 599

Playing Standard ACOL, West deals and opens 1♣. The scoring is Duplicate Pairs

3. What should the final contract be? 6♣

R E

T C H E O

25

N

A T R

13

19

♠ AQJ10 ♥4 ♦ K74 ♣ AQ732

G

12

21

Congratulations to this month’s winner – Daniel Collins

6

9

A I

11

SOLUTIONS FOR SEPTEMBER 2014 Bridge puzzle 46 Which contract?

M

8

M E O

puzzles@theactuary.com

5

C

© Nylfia

At the back Coffee break

BUT DOM EAS ERI HAG ON, ONE OOD SEL SNE VER WIT WIT

Dining options Mensa puzzle 600

Mixed messages Mensa puzzle 601

Since the introduction of a new menu, a restaurant has served 106 portions of CAVIAR, 1050 portions of LAMB, 50 portions of SOLE, 151 portions of PLAICE, 61 portions of OXTAIL and 66 portions of OX LIVER. How many portions of DUCK has it served?

Use the letters given to complete the pyramid so that one seven-letter word, one five-letter word, one four-letter word and three words of three letters can be read.

ANSWER 600.

The Roman numerals are totalled to give the amount.

Handed on a plate Mensa puzzle 602 Place three three-letter groups together to make a nine-letter food item.

What is it?

ANSWER Mangetout.

What are the words?

ABEEEELLOSTW P ANSWER Lobster, melee, pals, web, way and yet.

Y M R

GET ORB OUT ANT MAN BUR

Bridge puzzle provided by David Lampert

36

THE ACTUARY • October 2014 www.theactuary.com

p36_oct_puzzle_solution•SEMIFINAL.indd 36

SHUTTERSTOCK

23/09/2014 17:21

At the back Student student@theactuary.com

Student Most actuaries at some point will have experienced the low of failing an exam. Jessica Elkin offers some words of encouragement

FAIL-SAFE YOUR FUTURE Blinking rapidly, you cast your eyes down the list of names. Your hands feel a bit clammy.

What’s alphabetical order again? You can’t immediately see your name. Wait, is that it? … no. You’re not there. It could be a mistake? But you know already that this is unlikely. Scan again – nothing. You’ve definitely failed.

Most students have been there, or will be at some point before qualifying. Checking for results is pretty crummy at the best of times, but when you’ve had a disastrous sitting, it’s even worse. This is why I often ask generous friends to check for me, and why Ctrl+F is your friend – if anyone has found an efficient way to check on a smartphone, please let me know.

Admittedly, this is a bit of a dark topic when we’ve all only just put our calculators back down again and are looking to forget the collective trauma of an exam sitting, but it’s good to be prepared. If things go awry and you have to acknowledge to yourself that the months of slogging have been virtually fruitless, that you’re no closer to qualifying and that you’re going to have to go through it all again… it’s a tough gig.

Put simply, failing an exam is not the most fun you can have with your clothes on. So what can one do to alleviate the disappointment (at best) and gut-wrenching despair (at worst)?

Office shame Having fallen into the abyss of desolation, you then have to go into work and face your colleagues – or perhaps you were still at work

PHIL WRIGGLESWORTH

p37_oct_student.indd 37

since the results surface at 6pm these days.

Often everyone avoids the subject because they feel too uncomfortable.

On one results day I was in New York without the internet, but I knew I’d failed both exams because I had no well-wishing texts. My American friend thought I was crazy to think

like that, but I was right.

Understandably, people feel too awkward about it to get in touch – what should they say?

Would you rather be left alone? What an absolute minefield. However, it’s possibly better than having people send you congratulatory texts because someone with a very similar name to you has passed, as happened to a friend of mine.

I’m sure we all know one or two people who have never failed an exam. They breeze through the CTs, CAs, STs and SA without breaking a sweat. Unfortunately, or fortunately, these people are a minority. A colleague of mine says that you need to fail at least once to reassure everyone that you’re normal. It happens to the best of us (and yes, I mean me).

I once read that if you’re really upset by something you should ask yourself if it will still matter in a year. If not, perhaps it isn’t as important as you’re making it. Not to suggest that you should be able to shrug it off and go to the pub, necessarily, but it’s thankfully the case that you still get another go, or as many as you need, and failing one or two is not – in isolation – going to stunt your career. Most of your actuarial colleagues will have been there.

Once more unto the breach When it comes to the re-sit, you may well be dreading it. Going again through the material that was really difficult/snooze-inducing is not the most appealing thing. Should you brave it ASAP, or have a break from the material? Only you can decide what is best for you.

There is, however, a bright side to all this.

You can generally skip through all the reading material and get straight onto question practice, the holy grail of passing exams. If you are taking something new alongside, then you can mix up the reading of new material with the revising of old.

Naturally, writing about failure leads one to read inspirational quotes about it. They tend to extol the virtues of picking yourself up and carrying on. I’m sure you’ve read plenty yourself – probably by Steve Jobs or J K Rowling or Mahatma Ghandi (that guy was a talker). Whatever helps you, you probably need some time to grieve your loss. And once you’re done, hit those books.

In the meantime, you should probably enjoy a bit of post-exam celebration. I’m sure you got an A for effort. a

October 2014 • THE ACTUARY www.theactuary.com

37

23/09/2014 17:21

At the back Appointments

SPONSORED BY

peoplemoves@theactuary.com

Moves of retirement solutions in June this year. Having joined the company in

LV= has appointed Myles Rix (above) as managing director of its protection business. He has been at LV= for four years. Prior to working at LV=, Rix was at Aviva UK Health.

Towers Watson has appointed Peter Rowles (above right) as head of its retirement practice for the UK and Ireland. Rowles will succeed John Ball, who was appointed Europe, Middle East and Africa (EMEA) head

from JLT where he was a director. Carse joins Barnett Waddingham’s Bromsgrove office from Grant Thornton.

compliance manager at Towers Watson. He is a member of the IFoA regulatory DPB Committee.

Malcolm Lee (below) has set up his own consultancy business, Malcolm Lee Consulting. Formerly he was global regulatory

EY has made a number of appointments (pictured clockwise from top left). Gareth Sutcliffe has joined from Legal & General as a senior manager and will co-lead the insurance investments team. Richard Read has also joined the firm from RSA as a senior manager to the growing analytics team within the GI team. Meanwhile,

1987, Rowles has been involved in various leadership roles.

Barnett Waddingham has appointed Simon Cohen and Rebecca Carse within its investment consulting team. Cohen, who will assist in driving the growth of investment consulting services in Barnett Waddingham’s Amersham office, joins

Michael van Vuuren has been promoted to partner in the EMEIA insurance risk and

www.hfg.co.uk

CRAIG MORAN Employer and area of work: First Actuarial –

Tell us something unusual about yourself I can deadlift twice my bodyweight.

How would your best friend describe you? “Too

Greatest risk you have ever taken? Leaving the

clever for his own good!”

planning of my stag do to my brother and friends. Next year could prove interesting…

expectations.

What would be your personal motto? It’s not

suffered terribly.

Name five dream companions to be stuck on a desert island with? Arnold Schwarzenegger,

What’s your most treasured possession?

Sir Matt Busby, Morgan Freeman, Rachel Riley and Will Smith. A companion for every occasion.

What are the top three things you would like to achieve in your lifetime? Director of Manchester

to model any situation using a spreadsheet.

If you could learn one random skill, what would you learn? Whisky distilling.

Favourite Excel function? Index-Match, essentially vlookup’s better-looking sister.

How do you relax away from the office? Eat, drink and be merry. And then spend hours in the gym to undo the after effects of the aforementioned.

Alternative career choice? Formula 1 driver or professional footballer – it’s a hard choice.

p38_oct_AOTF.indd 38

If you could go back in history, who would you like to meet? Alan Turing, a great man who

where you’re from, it’s where you’re going.

What’s your most ‘actuarial’ habit? Attempting

THE ACTUARY • October 2014 www.theactuary.com

ACTUARY OF THE FUTURE

Pensions

What motivates you? Exceeding people’s

38

actuarial practice and Gareth Mee to director level, taking over the Bristol team.

My iPod, it comes with me everywhere.

United Football Club, qualify as a Fellow of the IFoA and travel to space. Not necessarily in that order.

If you ruled the world, what would you change first? Rid the world of poverty. Make it a legal requirement to know the answer to the question, ‘So what exactly is an actuary?’.

Do you know an actuary destined for greatness?

You can nominate an Actuary of the Future by emailing

aotf@theactuary.com

MIKE PLOWAY

23/09/2014 17:21

www.theactuaryjobs.com

Appointments

A P PO I N TME N TS To advertise your vacancies in the magazine and online please contact: Emmanuel Nettey +44 (0) 20 7880 6234 or emmanuel.nettey@redactive.co.uk

Highlighting Opportunities Finding the right opportunity for you can feel like finding a needle in a haystack. HFG’s Consultants specialise in matching you to the right role at the right company. Call us today to have a chat about your requirements, and find out what opportunities are available.

General Insurance Roles Head of Capital

Deputy Actuary £90 – £125k Basic, London

£70 – £110k Basic, London

A start up syndicate is looking for a Head of Capital, the role will work closely with the CFO and the Chief Actuary. This person should have the ability to work in a small team and communicate well across the firm. The right person will be required to build a team underneath them and develop the capital offering. For more information contact: william@hfg.co.uk REF: WG091

Rapidly growing syndicate is looking for a nearly or newly qualified Actuary to work under the Chief Actuary. The day to day work is across pricing, reserving and capital modelling and this is a fantastic opportunity to fast track your career. This person should be happy doing the day to day technical work as well as working closely with the underwriters.

Ambitious Actuary required. Contact: william@hfg.co.uk REF: WG092

Hybrid Actuary

Reserving Manager £70 – £115k Basic, London

£80 – £120k Basic, London

Established Lloyd’s Syndicate is seeking an Igloo expert to work closely across their Actuarial and IT team. The current Igloo model is used for capital, reserving, planning and cat reporting and this person will work closely with the Head of Capital to really enhance the offering. For more information contact: william@hfg.co.uk REF: WG093

Established general Insurer is looking for a qualified Actuary with a strong reserving background to help lead their reserving function. The role will have exposure to pricing and capital work and this person will lead a direct team of three and will have a strong interest in managing and mentoring junior staff. Contact: william@hfg.co.uk REF: WG094

Actuarial Non-Life Consultant

Capital Modelling Analyst

£55k – £60k Basic, London

£55k – £65k Basic, London

A market leading consultancy are hiring in their actuarial practice. This position will be targeted to projects mainly across reserving and capital modelling. The successful candidate will have at least 3-4 years’ experience within a London Market Insurer and be part way through their exams, having passed most of the core actuarial exams. Reserving and/or capital modelling experience highly desirable. Contact: ben@hfg.co.uk REF: BH091

A medium sized Lloyd’s Syndicate are expanding their Capital Modelling team. This role reports directly into the Head of Capital and has a dotted line to the CRO. The successful candidate is likely to have 3 years’ experience within the London Market, an advanced knowledge of Igloo software and be part qualified, having passed the core actuarial examinations with quick progression. Contact: ben@hfg.co.uk REF: BH092

Actuarial Analyst

Pricing Analyst £35k – £40k Basic, London

A leading P&C insurer are hiring across their actuarial team. This role offers a rotational split across the reserving and pricing function with some exposure to the capital model. The successful candidate will come from a numerical or scientific educational background, and will have 1-2 years’ experience within insurance and some CTs passed.

For more information please contact: ben@hfg.co.uk REF: BH093

£50k Basic, London A London Market Reinsurer are looking for a pricing analyst. This role reports directly into the Head of Reinsurance Pricing, with great development opportunities upon qualification.

The successful candidate will have 2-3 years’ experience from either reinsurance or primary insurance pricing.

For more information please contact: ben@hfg.co.uk REF: BH094

WILLIAM GALLIMORE

RUPA PITHIYA

BEN HICKEY

Director

Contract

General Insurance

+44 (0) 207 337 8826 william@hfg.co.uk

+44 (0) 207 337 1200

+44 (0) 207 220 1106

rupa@hfg.co.uk

ben@hfg.co.uk

+44 (0) 207 337 8800

www.hfg.co.uk October 2014 • THE ACTUARY 39 www.theactuary.com

p39_ACT.10.14.indd 39

22/09/2014 12:38

Appointments

The market is growing...

So are we

?

WE ARE LOOKING FOR AN ENTREPRENEURIAL, FORWARD THINKING CANDIDATE TO HELP GROW OUR BUSINESS. IF THAT’S YOU, CALL US: 020 3322 7474

EXCLUSIVE | QUALIFIED ACTUARY

NEARLY QUALIFIED ACTUARY

EXCLUSIVE | JUNIOR ACTUARY

Exclusive to Fenchurch, a Lloyds Syndicate ZKR XQGHUZULWH D GLYHUVLĂžHG SRUWIROLR RI 5H LQVXUDQFH VHHNV D 4XDOLĂžHG $FWXDU\ ZLWK \HDUV 34( 7KH UROH LQYROYHV &DSLWDO Modelling, Pricing and Reserving. Prior 6ROYHQF\ H[SHULHQFH DQG &DSLWDO EHQHĂžFLDO

$ G\QDPLF FXWWLQJ HGJH XQGHUZULWLQJ DJHQF\ ZLWK FRYHUDJH LQ WKH 0*$ 0*8 DUHQD LV ORRNLQJ IRU D 34 ç 1HDUO\ TXDOLÞHG $FWXDU\ IRU D PL[HG UROH 6WDUWLQJ IURP D EODQN SDJH ZLWK WKH GHVLJQ DQG GHYHORSPHQW RI V\VWHPV DQG SURFHVVHV

([FOXVLYH WR )HQFKXUFK $VVRFLDWHV D VSHFLDOLVW 5H ,QVXUHU LV ORRNLQJ IRU DQ $FWXDULDO VWXGHQW ZLWK PRQWKV H[SHULHQFH WR XQGHUWDNH D PL[HG UROH RI 5HVHUYLQJ 3ULFLQJ &DSLWDO WR VXSSRUW 4XDOLĂžHG PHPEHUV RI WKH WHDP 3ULRU /OR\GV 5HVHUYLQJ H[SHULHQFH EHQHĂžFLDO

b ¸ ­

b ¸ ­

b ¸ ­

London &RPSHWLWLYH 3DFNDJH PERMANENT

London &RPSHWLWLYH 3DFNDJH PERMANENT

London &RPSHWLWLYH SDFNDJH PERMANENT

WWW.FENASSOCIATES.COM

INFO@FENASSOCIATES.COM | +44 (0)20 3322 7474

Our client, a major UK savings, pensions, annuity and asset management group, is establishing a reinsurance company in Bermuda as part of its internaĆ&#x;onal growth strategy.

Assistant Actuary

ReporĆ&#x;ng Actuary

The Assistant Actuary in Bermuda will provide technical support for the pricing of annuity and longevity reinsurance transacĆ&#x;ons, and the producĆ&#x;on of key ÄŽnancial reporĆ&#x;ng results including IFRS, EV and Economic Capital. The role also involves responsibility for the maintenance of proper documentaĆ&#x;on as well as contribuĆ&#x;ons to iniĆ&#x;aĆ&#x;ves to improve eĸciency, eÄŤecĆ&#x;veness and control.

The ReporĆ&#x;ng Actuary in Bermuda will have key responsibility for ÄŽnancial reporĆ&#x;ng of annuity/longevity reinsurance business, including IFRS, Embedded Value, economic capital, Solvency II and Statutory Capital. The role also involves pricing of annuity/ longevity reinsurance transacĆ&#x;ons, including analysis of experience data and developing/reviewing assumpĆ&#x;ons and calculaĆ&#x;ons.

The successful candidate will be a parĆ&#x;ally qualiÄŽed actuary with experience of pricing/reporĆ&#x;ng of life insurance business. Experience of annuiĆ&#x;es and Asset Liability Modelling is desirable, as well as strong working knowledge of Prophet, Excel, VBA and Word.

The successful candidate will have life insurance reporĆ&#x;ng experience and will be a nearly or newly qualiÄŽed actuary. UK AnnuiĆ&#x;es experience and Asset Liability Modelling experience are desirable, plus strong working knowledge of Prophet, Excel, VBA and Word.

Bermuda

Bermuda

Both posiĆ&#x;ons are exciĆ&#x;ng and unusual opportuniĆ&#x;es to be part of a growing start-up company within the secure environment of an internaĆ&#x;onal organisaĆ&#x;on. They will require a commitment to the business and to living and working in Bermuda, with occasional travel to the UK and other countries potenĆ&#x;ally required.

AĆŠracĆ&#x;ve remuneraĆ&#x;on packages will be oÄŤered including relocaĆ&#x;on assistance.

Please send your CV to ExperĆ&#x;se Limited - bdajobs@experĆ&#x;se.bm – or apply online at www.bermudajobs.com by 31st October. All enquiries will be dealt with in strict conÄŽdence.

40

THE ACTUARY • October 2014 www.theactuary.com

p40_ACT.10.14.indd 40

22/09/2014 12:41

London : Chicago : Hong Kong : Singapore : Shanghai

www.theactuaryjobs.com

Pricing & Structuring Actuary - London 5HVHUYLQJ 0DQDJHU 5HDGLQJ $WWUDFWLYH 6DODU\ %HQH¿WV 3DFNDJH $WWUDFWLYH 6DODU\ %HQH¿WV 3DFNDJH 2QH RI WKH ZRUOG¶V OHDGLQJ ¿QDQFLDO LQVWLWXWLRQV LV ORRNLQJ WR HQKDQFH WKH LQVXUDQFH SHQVLRQV VROXWLRQV WHDP ZLWK WKH DSSRLQWPHQW RI D SULFLQJ DQG VWUXFWXULQJ DFWXDU\ 0DLQ UHVSRQVLELOLWLHV LQFOXGH VRXUFLQJ SULFLQJ ELGGLQJ DQG H[HFXWLQJ (XURSHDQ WUDQVDFWLRQV SHQVLRQV EXON DQQXLW\ ORQJHYLW\ <RX ZLOO KDYH H[SHULHQFH LQ 8. RU (XURSHDQ OLIH LQVXUDQFH DQG LQYHVWPHQW LGHDOO\ ¿[HG LQWHUHVW DQG GHULYDWLYHV .QRZOHGJH RI SULFLQJ LQ LQVWLWXWLRQDO LQVXUDQFH PDUNHWV IDPLOLDULW\ ZLWK UHLQVXUDQFH ULVN WUDQVIHU VWUXFWXUHV DQG 6ROYHQF\ ,, LQFOXGLQJ FDSLWDO DQG UHVHUYLQJ WUHDWPHQW RI LQWHUPHGLDWHG ULVNV DQG DOWHUQDWLYH IRUPV RI ULVN WUDQVIHU ZRXOG EH D GLVWLQFW DGYDQWDJH 7KH LGHDO FDQGLGDWH LV D IXOO\ TXDOL¿HG DFWXDU\ ZLWK DW OHDVW WKUHH \HDUV H[SHULHQFH LQ LQVXUDQFH VROXWLRQV FRQVXOWLQJ &RQWDFW SKX QJRF#LSVJURXS FR XN +44 207 481 8686

$ JURZLQJ LQVXUDQFH FRPSDQ\ LV ORRNLQJ WR KLUH D 5HVHUYLQJ 0DQDJHU WR MRLQ WKHLU $FWXDULDO 7HDP 5HSRUWLQJ WR WKH +HDG RI $FWXDULDO WKLV LV D NH\ UROH WR SURYLGH JXLGDQFH DQG DVVLVWDQFH WR YDULRXV VWDNHKROGHUV LQFOXGLQJ WKH %RDUG 7KH PDLQ WDVNV ZLOO EH WR PDQDJH D UHVHUYLQJ IXQFWLRQ DQG OHDG WKH GHYHORSPHQW DQG LPSOHPHQWDWLRQ RI WKH UHVHUYLQJ VWUDWHJLHV 7KH UHVHUYLQJ PDQDJHU ZLOO FDUU\ RXW UHJXODU UHYLHZV RI WHFKQLFDO SURYLVLRQV DQG FRPPXQLFDWH UHVXOWV WR WKH 7HFKQLFDO 3URYLVLRQV &RPPLWWHH 7KLV LV D JUHDW RSSRUWXQLW\ IRU DQ DPELWLRXV DQG WHFKQLFDOO\ VWURQJ UHVHUYLQJ DFWXDU\ ORRNLQJ WR PDQDJH D WHDP DQG DVVXPH JUHDWHU UHVSRQVLELOLW\ &RQWDFW SKX QJRF#LSVJURXS FR XN +44 207 481 8686

Senior Life Actuary - London 6HQLRU 3ULFLQJ 0DQDJHU *, /RQGRQ $WWUDFWLYH 6DODU\ %HQH¿WV 3DFNDJH $WWUDFWLYH 6DODU\ %HQH¿WV 3DFNDJH 2XU FOLHQW DQ HVWDEOLVKHG DQG VXFFHVVIXO LQWHUQDWLRQDO LQVXUDQFH FRPSDQ\ LV ORRNLQJ WR GHYHORS WKHLU OLIH KHDOWK EXVLQHVV VLJQL¿FDQWO\ +HQFH WKH\ DUH ORRNLQJ WR H[SDQG WKHLU DFWXDULDO H[SHUWLVH DW VHQLRU PDQDJHPHQW OHYHO %DVHG LQ /RQGRQ NH\ UHVSRQVLELOLWLHV DUH WR OHDG DQG PDQDJH WKH UHVHUYLQJ SODQQLQJ DQG SULFLQJ IXQFWLRQV DV ZHOO DV DVVXPH OHDGHUVKLS IRU WKH UHVW RI WKH WHDP 7KH LGHDO FDQGLGDWH LV D TXDOL¿HG DFWXDU\ ZLWK DW OHDVW \HDUV H[SHULHQFH RI PDQDJLQJ D EURDG UDQJH RI UHVSRQVLELOLWLHV ZLWKLQ D JURZLQJ OLIH DFWXDULDO WHDP )DPLOLDULW\ ZLWK 8. *DDS 86 *DDS 6ROYHQF\ ,, DQG JRRG FRPPXQLFDWLRQ FRPPHUFLDO VNLOOV DUH H[SHFWHG &RQWDFW SKX QJRF#LSVJURXS FR XN +44 207 481 8686

$ OHDGLQJ LQVXUDQFH FRPSDQ\ LV ORRNLQJ WR KLUH D 6HQLRU 3ULFLQJ 0DQDJHU WR EHFRPH D NH\ PHPEHU RI WKH VHQLRU PDQDJHPHQW WHDP 7KH PDLQ IRFXV RI WKH UROH LV SULFLQJ RSWLPLVDWLRQ EXW RWKHU WDVNV LQFOXGH UHVSRQVLELOLW\ IRU UHVHUYLQJ SURFHVVHV 7KH FRPSDQ\ LV ORRNLQJ IRU D IXOO\ TXDOL¿HG DFWXDU\ ZKR KDV DW OHDVW WKUHH \HDUV H[SHULHQFH RI SULFLQJ SHUVRQDO OLQHV EXVLQHVV DV ZHOO DV SURYHQ PDQDJHULDO VNLOOV *RRG NQRZOHGJH RI */0 (PEOHP 5DGDU LV UHTXLUHG 7KLV LV DQ H[FHSWLRQDO RSSRUWXQLW\ WR EXLOG D UHZDUGLQJ FDUHHU LQ D SUHVWLJLRXV HPSOR\HU

&RQWDFW SKX QJRF#LSVJURXS FR XN +44 207 481 8686

/RQGRQ 2I¿FH ,36 *URXS %HYLV 0DUNV +RXVH %HYLV 0DUNV /RQGRQ (& $ -% 7HOHSKRQH (PDLO DFWXDULDO#LSVJURXS FR XN September 2013 â&#x20AC;¢ THE ACTUARY 41 www.theactuary.com

p41_ACT.10.14.indd 41

22/09/2014 14:33

Appointments We are a recruitment consultancy with a difference Bringing Talent Together

Head of Capital and Reserving Location: North of England

Salary: £100-120k

Our client is a large general insurer in the North of England, who is looking for a Head of Capital and Reserving on a permanent basis.

The role is to manage and supervise a large team of 15 actuaries, with 2 direct reports, to develop a value add reserving and capital modelling function for the group.

You will handle all reporting, liaison with the regulator and develop strategy for the department as well as deputising for the chief actuary at committees. You will engage with senior stakeholders including the CFO, MD with regards to reserving and economic capital matters and handle SII preparation for the business.

The successful candidate will be a quali¿ed actuary with executive leadership experience, who is capable of technical hands on work as required, as well as setting strategic vision for a large department.

Contact Andrew Cannon

Anthony Hill

Please get in touch with Andy Cannon (andy.cannon@eamesconsulting.com) for a con¿dential discussion.

Actuarial, Pensions & Insurance Risk Management 020 7092 3262 andy.cannon@eamesconsulting.com

Actuarial, Pensions & Insurance Risk Management 020 7092 3287 anthony.hill@eamesconsulting.com

Of¿ce Number +44 (0)20 7092 3200

For current opportunities please visit www.eamesconsulting.com

Pensions & Investments | Non-Life | Life & Health

The missing piece to your career puzzle

To register for our Jobs by email service simply go to theactuaryjobs.com

42

UK | Europe | Asia Paci¿c

www.eamesconsulting.com

Your specialist actuarial recruiter in the UK, Mainland Europe, and Asia-Pacific, with dedicated sector specific consultants covering; Non-Life Life Pensions and Investments For a confidential career discussion please contact us on +44 (0)207 332 5870 or actuarial@mansionhouse.co.uk

THE ACTUARY • October 2014 www.theactuary.com

p42_ACT.10.14.indd 42

22/09/2014 15:53

www.theactuaryjobs.com

Life Insurance Roles CFO London, up to £180,000 per annum – Exclusive This fantastic opportunity will give a qualified Life Actuary the chance to become CFO of a life mutual. This is a key appointment and fundamental to the future direction and possible succession planning of the business. Within a fairly short time frame, this individual will be required to obtain confidence of the UK board, UK regulator and with the correct positioning, allow them to continue on the trail of organic and acquisitional growth.

This is a high profile position that requires gravitas, confidence, technical expertise and sound judgement. You will have to be able to balance the commercial objectives of the company with those of the policyholders and the regulatory requirements of the new regime. For more information contact: sophia@hfg.co.uk REF: SC091

Head of Economic Capital

Financial Reporting Actuary

London, up to £110,000 per annum

London, £60,000 - £80,000 per annum

This niche life insurer is looking for a qualified Life Actuary with a strong Economic Capital background to lead this team. You will be reporting to the Director of Capital Management and get involved with key decisions across the business with regards to the capital position of the Group and the implementation of Solvency II. For more information contact: sophia@hfg.co.uk REF: SC092

Working within a multinational Life insurer, this role will sit within the Financial Management team and be involved with the growing development of the method and assumptions for all the financial reporting metrics. This role will be ideal for a Life Actuary with a solid reporting background who would like to mentor students and liaise with senior stakeholders. Contact: sophia@hfg.co.uk REF: SC093

Risk Pricing Actuary

Capital Management Actuarial Analyst London, £35,000 - £50,000 per annum

Surrey, £55,000 - £80,000 per annum A leading life insurer is looking for a qualified Actuary to be responsible for the risk pricing and all actuarial aspects involved within pricing and product development. This role will have regular contact with the Risk division, so you will have good qualitative skills and be confident speaking to all business areas. Contact: sophia@hfg.co.uk REF:SC094

An opportunity has arisen for a Life Actuarial student to join a market leading insurer within their Capital team. This unique opportunity is perfect for a student who is making their way through the exams and wants to explore a different area as well as get exposure to Solvency II Contact: sophia@hfg.co.uk REF: SC095

Contract Roles Capital Contractor

Solvency II Actuaries

London, £700 - £900 per day, 18 months

London, £750 - £1200 per day, 6 - 12 months

An excellent opportunity has arisen with a valuable client for an analytical / Solvency II Actuary, either qualified or nearly qualified to help develop the analytical capabilities of their new software. This role will also involve producing reports and providing training and supervising other actuaries. You will have a strong knowledge and understanding of the general insurance market, be familiar with SII requirements and have a very technical background, as well as high level of communication skills. Contact: rupa@hfg.co.uk REF: RP091

This leading Insurer is looking to recruit a Solvency II actuary with Internal Model and regulatory interpretation experience.

To be successful you must have up to date Solvency II knowledge and know how to apply it practically to the business as well as experience in reviewing and challenging the model.

For more information contact: rupa@hfg.co.uk REF: RP949

Solvency II Reporting Lead

Pricing Actuary

North-West England, £900 per day, 6 months

Bristol, £750 per day, 6 months

A leading mutual is looking for a candidate with a wealth of Solvency II experience and a strong reporting background who would be comfortable in a lead role. There is longevity for this project to go well into 2016 and the role will involve reporting under the on-going Solvency II programme. Enhancements to the inputs and outputs to the Prophet models may be required. Contact: rupa@hfg.co.uk REF: RP092

A leading Life insurance company is looking to bring on an Actuary (part-way or fully qualified) to join its pricing team based in Bristol. The project will involve building the New Business Pricing Tool under the company’s wider Solvency II programme. The ideal candidate will have strong experience in management information tools and processes and new business risk. Contact: rupa@hfg.co.uk REF: RP093

Risk Roles Risk Analyst

ERM Actuary

London, £300 - £400 per day for 5 months

London, up to £95,000 Basic The CRO of this large P&C Insurer is looking for an Actuary with strong Capital/ERM experience to join their Risk team. The successful candidate will be a nearly/newly qualified Non-Life Actuary who is looking to take on a broader role with the ultimate aim of becoming a Head of Risk or CRO. You should be articulate and persuasive, be able to present complex concepts clearly and be able to critically assess issues. Contact: james@hfg.co.uk REF: JK091

SOPHIA CROSSMAN

JAMES KITT

ERIN O’DONNELL

Life Insurance

Risk Management

Risk Management

+44 (0) 207 337 1207

+44 (0) 207 337 1202

+44 (0) 207 337 1202

sophia@hfg.co.uk

james@hfg.co.uk

erin@hfg.co.uk

0207 337 8800

p43_ACT.10.14.indd 43

A leading syndicate is looking for a risk contractor to join their risk management team. You will have previously assisted in embedding frameworks and have had exposure to Solvency II, as well as ideally having some regulatory experience. You will gain exposure to both 1st and 2nd lines of defence and be involved in the design of Key Risk Indicators. For more information contact: erin@hfg.co.uk REF: EO091

www.hfg.co.uk

actuarialteam@hfg.co.uk

September 2013 • THE ACTUARY 43 www.theactuary.com

22/09/2014 14:35

Appointments

OUR CLIENTS ARE GLOBAL – AND SO ARE WE Seeking Slovak speaking Actuary Very compeƟƟve package

Syndicate Actuary A small Lloyd’s market syndicate with a strong Įnancial backing is looking for an up and coming Actuary to lead their actuarial funcƟon. The role will encompass all elements of actuarial work with a focus on reserving and capital modelling whilst working closely with the Underwriters on pricing.

This person will be qualiĮed in the last couple of years and looking for a step up in responsibility and exposure. They will need to be strong communicators with a willingness to take the lead and learn on their feet.

For more informaƟon please contact Victoria Cruickshank on 0207 929 7667

My client a leading Risk and Actuarial consulƟng Įrm, currently has a requirement for a future leader to join the team in BraƟslava. Generalist experience sought from either industry or consulƟng Įrms with exposure to life or non-life sectors.

This team plays a key role both locally and in conjuncƟon with the 8 countries that form the CEE division. Great opportunity for a senior student, nearly qualiĮed or recently qualiĮed actuary Ňuent in Slovakian to return home.

For more informaƟon please contact Clinton Poore on c.poore@darwinrhodes.com or phone 0207 929 7667

Pricing & Research Actuarial Our client is a global Life & health reinsurer who is looking for a nearly/newly qualiĮed life actuary.

You will be involved in Producing client-speciĮc quotaƟons across all lines of individual and group protecƟon insurance, ConducƟng experience invesƟgaƟons where relevant data is available, Developing and maintaining pricing tools and data repositories, Working on research projects, parƟcularly those requiring data and staƟsƟcal analysis and ConducƟng wider research to support new pricing, product development and risk management iniƟaƟves For more informaƟon please contact Adam Goodwin on 0207 929 7667

Each of these crossword clues is a full anagram of the answer: The or (5) They see (3, 4) Best in prayer (12) No city dust here (3, 11) Tender names (11) Moon starer (10) Name for ship (3, 8) Has to pilfer (1, 10) Please email your answers to London@darwinrhodes.com for your chance to win a prize

W www.darwinrhodes.com

E London@darwinrhodes.com

EV Reporting - Assistant Manager

Non-Traditional Actuary

Hong Kong, Up to HKD 700k package

Singapore, SGD 150,000 – 180,000 Are you bored or frustrated in a traditional actuarial role? Working for one of the leading reinsurers in the region, this client facing role will be fast paced and require a dynamic approach. You will focus on providing non-traditional reinsurance solutions to a diverse range of clients. Superb career prospects in this niche but growing area of the Asia insurance market. Contact jason@hfg.com.sg REF: JS091

A well-known direct insurer is looking for a nearly/newly qualified Actuary to join their EV regional reporting team. You will be assisting in updating & implementing actuarial guidelines for EV reporting and other ad hoc projects. You will have solid EV reporting skills & preferably Prophet experience. Local market knowledge is desirable. Contact tong@hfg.co.uk REF: TY007

Group Corporate Actuary – Asia

Regional ERM Lead Hong Kong, HKD 850k – HKD 1.3m base + bonus

Hong Kong, Up to HKD 1.5m package Exceptional opportunity to join the senior management team of this highly successful multinational insurer. Reporting to the Group Chief Actuary, you will be partnering with their businesses in Asia to guide & provide technical expertise on the pressing actuarial matters facing them. This position requires an excellent communicator & knowledge of the Asian market. Contact clare@hfg.com.sg REF: CB091

This role will be integral to risk management for this fast growing regional Life insurer. Reporting to the Group Chief Actuary you will be responsible for the development and implementation of the ERM framework and corporate best practice for Asia, including chairing the internal risk committee and liaising with country heads in SE Asia. Contact graeme@hfg.com.sg REF: GB091

Chief Actuary – The Philippines

Reinsurance Pricing

Manila, Dependent on Experience

Be there from the start, as this regional Insurer launches their business in the Philippines. They are seeking a technically strong Life Actuary to establish the actuarial function, build the team and report through to the Executive in Hong Kong. This is a hands on role which requires an Actuary willing to roll up their sleeves and get involved. Contact clare@hfg.co.uk REF: CB092

Jason Sykes Clare Bethell Graeme Braidwood Tong Yu

44

Managing Director Director Senior Consultant Consultant

Hong Kong, HKD 800k – HKD 1.3m base + bonus

A widely respected international Reinsurer is seeking a qualified and experienced life actuary to join their regional pricing team.

With specific knowledge of protection product pricing you will operate autonomously across the APAC markets. This is an excellent opportunity to diversify your market knowledge and international exposure. Contact graeme@hfg.com.sg REF: GB092

EA Reg: R1333193 EA Reg: R1434590 EA Reg: R1434568

www.hfg.com.sg +65 6829 7153 EA Licence Number: 14C7034

THE ACTUARY • October 2014 www.theactuary.com

p44_ACT.10.14.indd 44

22/09/2014 14:37

Appointments

Fresh Thinking For the latest news and views, visit theactuary.com. With high quality content, useful tools and easy navigation, you will find a wealth of actuarial resources at your fingertips.

Register for weekly email newsletters Read the latest features and opinion and add your comments Read about actuaries stepping into new frontiers Browse theactuaryjobs.com, the official jobs board of the UK actuarial profession

Visit www.theactuary.com 4

THE ACTUARY • May 2013 www.theactuary.com

p04_ACT.10.14.indd 4

19/09/2014 15:37

The best from www.theactuaryjobs.com Solvency II Actuary

Reserving Actuary

South East | Contract role £800- £1000 per day

Multiple Locations | Salary - Flexible

As a senior Solvency II actuary, you will be responsible for regulatory traceability, managing the assessment of regulatory requirements for all SII documents, compiling the IMAP template (including the cover documents), ensuring consistency, assisting with PRA engagement.

One of Europe’s leading mutual insurance companies urgently needs a reserving actuary to work in their growing team. This is a fantastic opportunity to work for a company who has good name in the market not just in the UK but in Europe as well. The successful actuary will be working on a mixture of commercial and personal lines products.

Senior Reserving Actuary

Interim Solvency II Data Actuary

Outside of the South East | Salary – Competitive basic plus bonus and benefits

London | Salary £700 - £1000 per day +

We are currently exclusively mandated to help a leading Personal Lines Division develop their GI reserving group.

This is a great chance for either a qualified or QBE Actuaries to take the next step in their personal careers.

A contract role for a Solvency II Actuary has arisen within the finance team of a leading life insurer. The finance function is responsible for the internal, external and statutory financial reporting whilst ensuring effective financial controls and the role would be focused upon understanding shortcomings in data and from reporting from the Pillar I team. You will support the SII Data Lead to ensure the group complies with the requirements on Data.

Manager – Pensions Consultancy

Pricing Actuary

Birmingham | Generous salary & package

London| Salary Up to £70,000 + Benefits + Bonus

A large consultancy is looking for a senior pensions specialist to join as Manager. The pensions team provides specialist employee benefits advice as part of a multidisciplined team covering all aspects of corporate advice; pension scheme cash requirements, risk control, liability management and benefit design, in addition to advising on transactions and financial reporting.

A Lloyd’s syndicate is currently seeking a nearly/newly qualified actuary to join their pricing function. Specifically the role will be responsible for the development and implementation of the pricing framework, across all lines of business. The role will also be heavily involved in Reserving and Capital modelling.

To advertise your vacancies in the magazine and online please contact Emmanuel Nettey on +44 (0) 20 7880 6234 or emmanuel.nettey@redactive.co.uk

46

THE ACTUARY • October 2014 www.theactuary.com

ACT Jobs board.indd 46

23/09/2014 11:50

Appointments

PLAN YOUR NEXT MOVE

ON THE MOVE

New features available through your smartphone See the latest job listings View all the jobs from the website Search or browse to find the right opportunities Create and update your live email job alerts View jobs directly from your email alerts Save and apply for jobs Save jobs to your profile Email jobs to yourself or friends Apply for the right jobs first using your saved CV Keep track of all your jobseeking activity

Go to www.theactuaryjobs.com 4

THE ACTUARY • May 2013 www.theactuary.com

p47_ACT.10.14.indd 4

23/09/2014 10:46

Appointments NON- LI FE SENIOR PRICING MANAGER

RESERVING - PROPERTY AND CASUALTY

LONDON MARKET RESERVING

£ depends upon experience

up to £80k + bonus + benefits

£ excellent + bonus + benefits

NON-LIFE SOUTH EAST

STAR1975

NON-LIFE SOUTH WEST

STAR2073

NON-LIFE LONDON

STAR2100

Leading insurance group is seeking a qualified non-life actuary to take responsibility for pricing decisions across all lines of business to improve rating structures, risk and operational costs, and price optimisation.

Our client has an exciting opportunity for a partqualified or qualified actuary with GI Solvency II reserving experience to develop market-leading technical provisions methodologies and provide key actuarial business planning insights.

Seeking a qualified non-life actuary to manage the actuarial reserving and technical provisioning for our client, ensuring the quarterly reserving process is completed to a high standard and in a timely manner.

COMMERCIAL LINES PRICING MANAGER

PRICING ANALYST

NON-LIFE CONSULTANCY

£ excellent + bonus + benefits

up to £60k, depending on experience

£ excellent + bonus + benefits

NON-LIFE LONDON

STAR2095

NON-LIFE SOUTH WEST

STAR2074

NON-LIFE LONDON

STAR2063

Seeking a strategically focused and innovative non-life expert to set and deliver a pricing plan to achieve the Broker Commercial Lines financial objectives.

Our client is looking for a part-qualified actuary with commercial pricing experience to strengthen its actuarial pricing team, deriving appropriate technical premiums and underwriting analytics to support the UK business.

Leading global consultancy is seeking a part-qualified or qualified non-life actuary to join its team. You will have reserving, risk or capital experience, along with strong leadership skills.

COMMERCIAL ACTUARY

NON-LIFE CONSULTANCY

ACTUARIAL ANALYTICS MANAGER

£ excellent + bonus + benefits

£ excellent + bonus + benefits

£ excellent + bonus + benefits

NON-LIFE LONDON

NON-LIFE GREATER LONDON

NON-LIFE SOUTH EAST

STAR2070

STAR2015 & STAR2013

STAR1972

Global insurer and financial services company seeks a qualified non-life actuary to lead the actuarial input into the commercial lines of business, including quarterly reserving, pricing and business planning.

Opportunities for part-qualified or qualified actuaries to join a leading firm, providing high-quality consulting services to wide-ranging clients. Develop your technical and softer skills every day within a variety of projects.

An excellent opportunity to join one of the UK’s leading general insurers. Use your existing non-life experience to optimise risk management controls and help to deliver the company’s financial risk strategy and plan.

GI RESERVING EXECUTIVE

MOVE INTO ANALYTICS

INTERNATIONAL PRICING MANAGER

£ excellent + bonus + benefits

£ excellent + bonus + benefits

£ excellent + bonus + benefits

NON-LIFE MIDLANDS

STAR2028

NON-LIFE LONDON

STAR2062

NON-LIFE WALES

STAR2061

Our client has an exciting opportunity for a part qualified or qualified non-life actuary to provide support, solutions, recommendations and advice to the GI business on a range of reserving and other financial projects.

Leading consultancy seeks exceptional actuaries to join its growing analytics team.

You will develop an impressive range of consulting and technical skills that will enhance your career.

Leading insurer is seeking a qualified non-life actuary to establish best practice pricing for its international operations, overseeing detailed analyses to determine rate changes.

PERSONAL LINES PRICING ANALYST

PRICING EXPERTISE

ACTUARIAL PRICING - NON-LIFE

up to £65k + bonus + benefits

up to £75k + bonus + benefits

up to £50k + bonus + benefits

NON-LIFE LONDON

STAR1900

Seeking a part-qualified non-life actuary with personal lines pricing experience to lead on a wide range of projects, including price optimisation. Experience and understanding of a wide range of software packages is desirable.

NON-LIFE SOUTH EAST

STAR1941

NON-LIFE MIDLANDS

STAR1946

Leading financial services group seeks a part-qualified or qualified pricing expert to contribute towards the delivery of appropriate pricing for commercial lines business strategies and objectives.

Leading financial services firm has a unique opportunity for a part qualified or qualified actuary to provide support and solutions to the GI business on a range of pricing and other financial projects.

TELEMATICS SPECIALIST

DIRECTOR - CAPITAL MODELLING

REINSURANCE PRICING ACTUARY

£ excellent + bonus + benefits

£ excellent + bonus + benefits

£ excellent + bonus + benefits

STARVACANCIES NON-LIFE SOUTH WEST

STAR2002

Utilise your telematics experience and work with senior stakeholders to drive developments within this niche insurance group, inspiring innovation and growth.

48

STAR1850

Seeking a qualified non-life actuary to take the lead on a number of capital modelling workstreams, delivering innovative solutions to clients for optimisation and streamlining of their internal controls, processes and data flows.

NON-LIFE LONDON

STAR2122

Market leader seeks pricing actuary with experience of traditional reinsurance pricing for property and casualty business, including exposure rating and experience rating.

Antony Buxton FIA Anton

Lance Randles MBA La

Paul C Cook

Joanne Young Joa

MANAGING DIRECTOR MANAG

ASSOCIATE DIRECTOR AS

SENIOR CONSULTANT

OPERATIONS DIRECTOR OPER

THE ACTUARY • October 2014 www.theactuary.com M +44 7766 414 560 E antony.buxton@staractuarial.com

p48-49_ACT.10.14.indd 48

NON-LIFE LONDON

M +44 7889 007 861 E lance.randles@staractuarial.com

M +44 7740 285 139 E paul.cook@staractuarial.com

M +44 7739 345 946 E joanne.young@staractuarial.com

23/09/2014 12:51

LI FE www.theactuaryjobs.com

RI SK PENSI ONS I NVESTM ENT LIFE ACTUARY - BANKING

LIFE ACTUARY - BULK ANNUITY

DIRECTOR LEVEL LIFE CONSULTANT

£ excellent + bonus + benefits

up to £65k + bonus + benefits

£ excellent + bonus + benefits

STAR2120

LIFE & PENSIONS LONDON

STAR2119

LIFE LONDON / EDINBURGH

STAR2080

Leading firm seeks exceptional life actuary, ideally with reinsurance and / or investment experience. Please contact us for more information on this unique role.

Leading life company is seeking a part-qualified or qualified actuary with a knowledge of UK defined benefit pension schemes to be responsible for supporting the pricing and quotation functions for the new bulk annuity initiative.

Apply your skills in projects reaching beyond traditional actuarial boundaries. Lead teams, build strong client relationships and contribute to the growth of the practice. You will be an expert in your chosen area.

REINSURANCE ACTUARY

INTERNAL MODEL VALIDATION

RISK ACTUARY

£ excellent + bonus + benefits LIFE LONDON

up to £87k + bonus + benefits STAR2064

£ excellent + bonus + benefits

LIFE SOUTH EAST

STAR2096

LIFE & RISK SOUTH COAST

STAR2079

World leader in reinsurance is seeking a qualified life actuary with reinsurance pricing experience and strong interpersonal skills to make a difference within its London-based team.

Leading financial services firm has an exciting opportunity for a qualified life actuary to manage the delivery of its validation framework and processes to meet Solvency II standards.

Seeking a qualified life actuary and risk expert to deliver recommendations and solutions to business problems. Flexibility in approach and strong communication skills required.

ACTUARIAL TEAM MANAGER

SOLVENCY II OPPORTUNITIES

CORPORATE ACTUARY - RISK ANALYTICS

£ excellent + bonus + benefits LIFE GREATER LONDON / SOUTH EAST

up to £80k + bonus + benefits

up to £80k + bonus + benefits STAR2082

LIFE SOUTH WEST

STAR1961

LIFE SOUTH EAST

STAR2106

This position is responsible for managing and mentoring a team of 4-5 staff and providing expert knowledge on UK actuarial valuations, reporting requirements and the use of Prophet.

A leading global insurer has a number of vacancies for qualified life actuaries, providing exposure to Solvency II, excellent career development potential and interaction with the wider business.

Our client has an exciting opportunity for a qualified actuary to oversee the production of financial projections for business planning and capital management, recommending appropriate assumptions and methodology.

LIFE CONSULTANCY

ACTUARIAL ASSISTANT - MARKETING

ACTUARIAL ASSISTANT

£ excellent + bonus + benefits

£ depends upon experience

£ excellent + bonus + benefits

LIFE NATIONWIDE

STAR2014

LIFE SOUTH WEST

STAR1976

LIFE GREATER LONDON / SOUTH EAST

STAR2081

Global consultancy seeks adaptable partqualified and qualified life actuaries wishing to gain a wide range of experience. Provide technical input, manage client relationships and lead high-performing teams in these fulfilling roles.

Seeking a commercially-minded and technically adept part-qualified actuary to provide actuarial expertise within the Research and Development team, focusing on the design, development and implementation of new and innovative products.

This position is responsible for assisting with mid-year and annual valuations, changes to Prophet models and Prophet upgrades. You will implement process efficiencies and controls, and update documentation.

INVESTMENT RISK SOLUTIONS

INVESTMENT EXPERT - LONDON

INVESTMENT CONSULTANTS

up to £40k + bonus + benefits

£ depends upon experience

£ very competitive

INVESTMENT LEEDS

STAR2011

Leading financial services firm has an exciting opportunity for a part-qualified investment actuary to provide strategic advice, helping clients to determine the appropriate mix of risk and return and the optimum use of capital.

INVESTMENT LONDON

STAR2111

Leading consultancy has an exciting opportunity for an investment actuary to deliver high quality advice to both trustee and corporate clients, employing strategic and innovative solutions on a wide range of issues.

INVESTMENT EDINBURGH

STAR1984

Leading practice seeks part-qualified or qualified actuaries with investment consultancy experience to join a growing team. You will have strong technical and client facing skills.

Star Actuarial Futures Ltd is an employment agency and employment business

LIFE LONDON

www.staractuarial.com EXCLUSIVE - ANNUITIES ROLE

CLIENT-FACING CONSULTANT

£ excellent + bonus + benefits PENSIONS LONDON

£ excellent + bonus + benefits STAR2115

Leading specialist insurer has an exciting opportunity for a part-qualified pensions actuary to provide support across the defined benefit solutions sales team, preparing quotation material and sales pitches.

PENSIONS SOUTH EAST

£ excellent + bonus + benefits STAR2104

Seeking a part-qualified or qualified pensions actuary to work within a client-facing team on a variety of UK defined benefit pension schemes. Please contact us for more details.

PENSIONS MIDLANDS

STAR2089

Leading financial services firm has a number of excellent opportunities for high-calibre part-qualified and qualified actuaries to join its growing team.

Louis Manson Lou

Irene Paterson FFA Ire

Peter Baker

Clare Roberts

MANAGING DIRECTOR MAN

PARTNER PAR

SENIOR CONSULTANT

SENIOR CONSULTANT

M +44 7595 023 983 E louis.manson@staractuarial.com

p48-49_ACT.10.14.indd 49

MANAGEMENT CONSULTANCY

M +44 7545 424 206 E irene.paterson@staractuarial.com

M +44 7860 602 586 E peter.baker@staractuarial.com

October 2014 • THE ACTUARY 49 www.theactuary.com M +44 7714 490 922 E clare.roberts@staractuarial.com

23/09/2014 12:51

GENERAL INSURANCE - UK Head of Capital Rob Bentham

London £175,000 + Bonus + Benefits

Senior Pricing Actuaries x 3 Paul Francis

London £130,000 + Bonus + Benefits

EXCLUSIVE ROLE: I have a mandate to select a Head of Capital for a leading brand in the Lloyd’s arena. You must be a strategic thinker able to lead optimisation and usage initiatives, liaise with depts. across the group, and manage, influence & negotiate at all levels.

I am working with three distinctive Lloyd’s/London Market businesses requiring senior level input to pricing. They require excellent rate/benchmark model development experience, transactional work with underwriters, and portfolio level analyses.

Head of Reserving Paul Francis

Reserving Actuary Ross Anderson

London £120,000 + Bonus + Benefits

London Up to £65,000 + Bonus + Benefits

A prominent, multi-platform (including Lloyd’s), multi-class insurer requires a Head of Reserving to manage a small team. Self-sufficiency and autonomy is expected from the role-holder, as is good experience with BAU and SII inputs that impact reserving.

An internationally renowned London Market insurer is looking to hire a technically strong nearly/newly qualified Reserving Actuary. This job would suit somebody with a consultancy background looking to develop their technical skills within a successful team.

Cat Modelling/Exposure Management London Rachel Kelly £30,000 - £110,000

Reserving Actuary - Non-Life Midlands Sarah Robins £Excellent + Bonus + Benefits

I am currently working with a number of Lloyd’s syndicates who are looking to strengthen their Cat Modelling and Exposure Management functions. Opportunities are varied and range from Junior Analyst to head of roles. Please call me for more details.

Leading general insurer seeks a nearly/newly qualified Actuary to provide support, solutions, recommendations and advice to the G.I. business on a range of reserving and other financial projects. You must be a strong communicator and possess strong actuarial and technical skills. Previous G.I. reserving skills are preferred.

CONTRACTS - GENERAL INSURANCE - UK Documentation Specialist Elise Ogden

London £800 - £1,000/day

We are seeking a number of documentation specialists to work with a variety of clients. Activities involve updating and creating documents to submit to the PRA for IMAP. Candidates must have expert knowledge of the latest SII requirements.

Standard Formula Specialist Elise Ogden

London £500 - £800/day

One of our London Market clients is seeking a SII specialist to perform regulatory capital calculations. The candidate must have strong technical knowledge of the SII requirements for calculating the Solvency capital requirement using the standard formula.

LIFE INSURANCE - UK Head of Healthcare Natalie Lightfoot

London (City) £150,000 + Bonus + Benefits

Reinsurance Manager Hugo Chambers

Edinburgh £100,000 + Car + Package

My global client is recruiting a Head of Healthcare. Successful candidates will ideally have a breadth of experience across life and healthcare. Strong communication skills and previous pricing exposure is essential.

Excellent opportunity to join a prestigious organisation based in Edinburgh. You will help develop and agree the reinsurance strategy within the protection team. Successful candidates will have knowledge of the UK protection market and proven relationship management skills.

Head of Product Development Hugo Chambers

Capital & Risk Actuary Natalie Lightfoot

South West £100,000 + Car + Package

South East £85,000 + Package

Opportunity for a senior pricing/product development Actuary to join a fast growing business. This role will require leadership of a team of actuaries with a focus on new product development and maintenance of the existing product line.

A market leading life insurance business is looking to recruit a qualified Actuary to join their capital team. Candidates must have Solvency II experience. This is a fantastic opportunity for senior exposure and excellent career progression.

Economic Capital Actuary London Richard Howard £65,000 - £75,000 + Bonus + Benefits

Capital Modelling Actuary London (City) Clare Nash £55,000 - £80,000 + Bonus + Benefits

Excellent opportunity for a qualified Actuary to join the economic capital team of this leading organisation in London. Fantastic chance to work with an ambitious and talented senior team. Looking for recently qualified actuaries with strong technical abilities.

A city based insurer is seeking a part qualified - newly qualified Capital Modelling Actuary to work within the GHO. Candidates must have prior economic capital modelling experience and strong VBA/ Excel skills.

CONTRACTS - LIFE INSURANCE - UK PQ Actuary x 5 Kaylash Kukadia

London (City) Up to £600/day

I am currently working on an exclusive assignment to engage five PQ Actuaries for a sought after client. Suitable candidates will have experience in Solvency II, ICA or IMAP.

p50-51_ACT.10.14.indd 50

EV Project Actuary Benjamin Moses

London £600 - £900/day

I am currently working with one of the world’s leading life insurers to help them establish a project team to implement EV into their business reporting structures. This is an exciting global project and one which requires PQ to qualified actuaries with a variety of skills.

Please contact me for details on the project.

22/09/2014 15:43

ASIA Associate Director, Group & Health Hamza Mush

Hong Kong £££Competitive

My client is a market-leading life insurance business in Asia, seeking a qualified and senior individual to join their regional office. You will drive all strategic development initiatives for their entire group and health portfolio across all 16 of their key markets.

Head of Pricing Hamza Mush

Singapore £££Competitive

A top-tier insurer is looking for a fully qualified and commercial Actuary to be the Head of Pricing for all business lines. You will lead a highly efficient team and play a crucial role in further growth initiatives of the business.

APAC Regional Actuary Gary Rushton

Hong Kong £££Competitive

General Insurance – UK Paul Francis

0207 649 9469

Rob Bentham

0207 649 9351

Sarah Robins

0207 310 8552

Rachel Kelly

0207 310 8579

Ross Anderson

0207 649 9357

Contracts - G.I. - UK Elise Ogden

0207 649 9355

Life Insurance - UK

High profile role: a leading MNC life insurer currently seeks an experienced Actuary to play a key role in the development of a start-up regional department, driving the efficiency and value of the business. Strong stakeholder management is a must.

Clare Nash

0207 649 9350

Richard Howard

0207 649 9356

Reporting Actuary Philip Chau

Natalie Lightfoot

0207 310 8547

Hugo Chambers

0207 310 8642

Hong Kong £££Competitive

One of the leading multinational insurers is looking for an experienced Actuary to lead their IFRS reporting team. This role will give you huge visibility within the business, where you will be working closely with the CFO and CRO on various projects.

Contracts - Life Insurance - UK/Europe Benjamin Moses

0207 310 8793

Consulting Actuary Toby Weston

Ani Pannell

+353 144 75975

Kaylash Kukadia

0207 310 8581

Singapore £££Competitive

Our client is a leading professional services firm; due to changing regulations in SE Asia they are recruiting for a lead Actuary in Singapore to lead projects, develop the business and help grow a team covering all actuarial duties, focussed on regulatory changes.

Motor Actuary Toby Weston

Hong Kong £££Competitive

High-growth MNC insurer in Hong Kong seeks a pricing expert with strong GLM and SAS. Reporting to the Chief Actuary, this person will assist their entities across the region on pricing of both personal and commercial lines. Mandarin preferred.

EUROPE Quant Developer Britt Ootes

Asia Gary Rushton

+852 5804 9223

Toby Weston

+852 5804 9042

Philip Chau

+852 5804 9287

Hamza Mush

+852 5804 9048

Rhoda Rivera

+852 5804 9225

France Amsterdam £££Competitive

Emérique Opou

+33 1 76 77 46 30

Agathe Ibazizen

+33 1 76 77 46 31

Our client is a large credit risk insurance group seeking to recruit a Quant Developer. You will be responsible for the development and maintenance of models that are used for calculation of IFRS and SII technical provisioning on group level.

Ireland

Pricing Manager - Reinsurance Agathe Ibazizen

Benelux

Paris €75,000 - €90,000

My client, a reinsurance company in Paris, is looking for a Pricing Manager to be based in their Paris office. You will be in charge of the Italian market (property and casualty).

English and French language skills are required for the role.

Life Risk Methodology Actuary Manuel Lovell

Germany Up to €80,000 + Bonus + Benefits

My client is looking for an expert in developing the methodologies in order to integrate the various risk components into the stochastic models created by a separate team. You must be a strong communicator wanting to get involved with topics such as SII.

General Insurance Actuaries - Dublin Patrick McMahon

Dublin, Ireland €35,000 - €80,000

I am working with a number of renowned general insurers in Ireland to recruit to some exciting opportunities across personal and commercial lines pricing and reserving as well as roles in capital. With a shortage of skills available salaries are high!

IMAP Actuary Alessio Montaruli

Cologne, Germany Up to €1,000/day

Patrick McMahon

+353 1 437 0625

Niels van Nieuwkerk

+31 2090 0033

Laurence Baken

+32 24 012 249

Britt Ootes

+312 0290 0035

Germany Manuel Lovell

+49 89 2109 3362

Emina Biscevic

+49 89 3803 8965

Alessio Montaruli

+49 89 2109 3339

Switzerland Audrey Dresen

+41 43 508 0444

Please contact one of the team for further information on any of the opportunities above or visit www.ojassociates.com/jobs

Our client is looking for a senior actuarial contractor to support the model validation team in writing the annual model report, allowing the top management (BoM) to approve annually, all governance activities at once. English language skills are a must.

General Contact Details:

E

actuary@ojassociates.com

Variable Annuities Actuaries Ani Pannell

W

www.ojassociates.com

Dublin, Ireland €550 - €950/day

My client seeks actuaries from PQ level up to five years PQE to assemble a new variable annuities project team. Candidates should have good prophet experience and strong product knowledge; applicants need not necessarily have worked with VA previously.

p50-51_ACT.10.14.indd 51

@OJAssociates oliver-james-associates

22/09/2014 15:43

www.the-arc.co.uk

The Actuarial Recruitment Company

A fresh approach

Senior Reserving Actuary London

General Insurance £Six Figures

Actuarial Analyst Bermuda

General Insurance $Excellent

A Senior Reserving Actuary is required for this Lloyd’s Managing Agency with responsibility for a range of property, casualty and specialty lines. The role will include production of quarterly reserves and financials, analysis of reserve risk for the internal capital model and Technical Provisions, development of new reserving and reporting tools and ensuring compliance with regulatory requirements. The client is looking for a qualified actuary with a number of years relevant reserving experience. Ref: ARC26261

This Bermuda based reinsurer is looking for a part qualified actuary with a background in capital modelling ideally from a London Market business. Experience of reinsurance pricing would be an added benefit. The client wants a self sufficient candidate with strong technical skills and a proactive approach. Good communication skills will be needed and the ability to get on and work well in a small multi disciplinary team. Good benefits including bonus, housing allowance and salary on offer. Ref: ARCBermuda

Reinsurance Broking London

Pricing Analyst London

General Insurance £Competitive

Supporting the P&C lines for this major reinsurance broker this role will suit an individual with a strong personality, excellent communication skills and a proactive approach. The work will involve reinsurance pricing using cutting edge modelling techniques, involvement in the design and pricing of non-traditional reinsurance solutions, reinsurance optimisation work, support for reinsurance renewals as well as tenders for new business. Interaction with broking clients will be expected from an early stage. Ref: ARC20120

General Insurance To £65K

A part qualified actuary with around 3 to 4 years of experience is needed to support motor/household pricing for this international insurance business. Good statistical knowledge and ideally experience of GLM techniques will be required. The client wants someone who can communicate technical information well to non-technical personnel.

Some international travel will be required with the role as well as management and mentoring of more junior staff. Ref: ARC26260

Call us anytime including evenings and weekends on 020 7717 9705 or email enquiries@the-arc.co.uk Andy Clark BSc FIA Roger Massey BSc MBA FIA

0781 333 7891 0781 398 9016

andy@the-arc.co.uk roger@the-arc.co.uk The Actuarial Recruitment Company is an employment agency

p52_ACT.10.14.indd 52 ARC FP.indd 1

22/09/2014 16:23 15:47 17/09/2014