The actuary international supplement 2016

South-East Asia specific

Spotlight on Sri Lanka

Climate change and finance

We talk to members of the IFoA in Singapore and Malaysia about the ASEAN Economic Community

Highlighting innovation and future prospects amid tighter regulatory controls in the emerging markets

Creating an integrated climate risk strategy to explore mitigation planning and create new investment

JULY 2016

theactuary.com/international

international actuary The magazine of the IFoA

East meets West New challenges and opportunities unleashed in the rising East

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28/06/2016 11:45

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The IFoA Asia Conference 2017 11-12 May 2017, Hong Kong

,QWHUHVWHG LQ VSRQVRULQJ WKH FRQIHUHQFH" 3OHDVH HPDLO HYHQWPDQDJHPHQW#DFWXDULHV RUJ XN WR UHJLVWHU \RXU LQWHUHVW View the feedback from over 370 delegates at the 2016 conference in Kuala Lumpur.

2016 Fonference attendees by practice area: Pensions 1%

2016 Fonference attendees by employer: Others 2%

7% Finance and Investment

6% Regulator

Insurer 52%

Life 51%

6% Association 6% Academic

General Insurance

30%

12% Reinsurer

4% Health and Care

16% Consultant

7% Risk Management

Was the conference a good investment:

Rate the 2016 Fonference: 40%

54%

6%

38%

50%

12%

Excellent!

Good

Satisfactory

Excellent!

Good

Satisfactory

2016 Fonference delegate testimonials:

Excellent all-round event: CPD, networking, relevant issues ... it has it all!

The conference is a great way to broaden your professional horizons both in the knowledge gained and people met

www.actuaries.org.uk

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Can’t fault the event, exceeded expectations on every aspect.

Speakers line-up was especially impressive

Great opportunity to hear from industry and thought leaders, as well as to network with actuaries from all over the world

The best conference I have been to in KL for 20 years!

Great event for learning and development, I would highly recommend the conference to others

www.actuaries.org.cn

28/06/2016 11:28

Brett Riley and David McNab are principals at Finity Consulting

Box 1 First wave Heavy industrial asbestos use, including mining, milling, manufacturing asbestos products, installation and transportation. Peak exposures often occurred prior to the 1970s.

Second wave Occupational downstream asbestos product use, particularly in the building industry. Peak exposures were mainly in the 1970s.

Third wave Later occupational and non-occupational exposures, usually with lower intensity and lower cumulative exposures. Jobs exposed in this group include white-collar occupations. This cohort also covers domestic non-occupational exposures (home renovators). Peak exposures are potentially later than the 1970s.

The third wave Brett Riley and David McNab look at the impact of asbestos and describe their analysis and projection of mesotheliomas in Australia

Readers interested in the detailed report may access it from Finity Consulting’s website: bit.ly/1XKA2Ax 26

THE ACTUARY • July 2016 www.theactuary.com

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By 1954, Australia was the fourth-largest consumer of asbestos cement products (after the US, United Kingdom and France) but with the highest per capita consumption.

Given that most mesotheliomas, cancers of mesothelial cells, are caused by asbestos exposure, it is no surprise that Australia has had the highest per capita incidence of mesothelioma, with around 700 cases per annum in recent years. Most asbestos was used in the cement manufacturing industry, with a quarter of all new Australian houses clad in asbestos cement in the 25 years after the Second World War. Recently, we were asked by the Asbestos Safety and Eradication Agency (ASEA) to analyse and project cases of mesothelioma in Australia, to support discussions around asbestos exposure and inform policy options.

ASEA is an Australian Government agency providing a national focus on current asbestos exposure and covering workplace health and safety, environmental and public health matters.

Historically, asbestos-related disease studies have focused on the first and second waves of exposure (see Box 1, above). ASEA asked us to also consider the third wave. This is important owing to the prevalence and popularity of home renovations in Australia.

A second difference from other approaches is that our model allows for exposure from asbestos removal, as well as consumption. Removal often happens

decades after consumption. Lastly, we projected cases of mesothelioma diagnosed, not claims for compensation.

Our projection was calibrated to the number of mesotheliomas from 1988 to 2014, to fit cancer registry data over this period. Future cases were projected from 2015 to 2100.

Exposure-based approach We used a population exposure and incidence model. This was calibrated to observed cases and their known characteristics, such as age, gender, exposure periods and known sources of exposure. We prepared a most likely ‘base’ scenario (described in Box 2) but also tested alternative scenarios to highlight uncertainties. In particular: ● There were separate projections for the early waves (first and second waves) and the third wave. ● Explicit assumptions were made for the age profile at first exposure and duration of exposure. ● Relative risks for the different types (blue, brown and white asbestos) are important model inputs, because the use of each type varied over time. We set the risk weights according to the Institute and Faculty of Actuaries’ Asbestos Working Party modelling in 2009 (see box 3). ● Our disease incidence model reflects the long latency for mesothelioma and risk increasing exponentially since exposure. ● Figure 2 shows the relative risk assumed by calendar year, after allowing for all other factors. This index covers changes in asbestos handling practices and regulations over time.

SCIENCE PHOTO / REX FEATURES

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Key assumptions and judgments While the data was complete in many respects, some exposure information was missing. This necessitated some important judgments.

Surveys were used to collect data on occupational and non-occupational exposure sources; up to 2015, only 17% of cases provided this information.

We assumed that this subset is representative of all mesotheliomas, after testing for reasonableness.

Also, where a patient had both occupational and non-occupational exposure, the former is a much more likely source of risk. We allowed for this in the risk weights in our model.

Background mesotheliomas have unknown or unidentified past asbestos exposure.

We assumed that these currently comprise 5% of all mesotheliomas, consistent with other studies and data. In our base scenario, the background cases comprise the majority of mesotheliomas for the period after 2050.

Figure 3 shows the base scenario projection.

In this we project 19,427 cases of mesothelioma diagnosed between 2015 and 2100. Some 58% of cases are attributed to the run-off of ‘industrial’ exposures from the first and second waves. The remaining 42% come from the third wave (including background mesotheliomas).

Our base scenario reaches a peak number of cases in 2015 (712). The total number of cases halves to 350 per annum in about 2040 and reaches 100 per year in the 2050s. However, third-wave cases do not peak until 2021.

There is significant uncertainty surrounding

our projection, owing to incomplete information and because outcomes are dependent on future events. Figure 4 shows the range of results from plausible changes in model parameters. These changes lead to total future mesothelioma counts being around a third higher or lower than our base scenario.

Raising risk awareness Many mesotheliomas in the past emerged from small exposed populations receiving relatively large doses of asbestos exposure (for example, workers at the blue asbestos mine in Wittenoom). But now we are observing an increasing minority of third-wave cases. This exposed population is much larger but mostly faced much lower levels of exposure than the high-risk occupations. Many of these individuals will be unaware they were exposed to asbestos.

Current asbestos exposures are significantly lower than they were up to the 1980s.

However, these exposures will still give rise to mesotheliomas. Governments, employers, trade unions, regulators, tradesmen, asbestos removalists and households should take reasonable precautions when dealing with asbestos in future to reduce this risk.

Raising awareness of the risks is important.

The legacy of asbestos is different in each country; Australia has a large residual exposure in its housing stock, exacerbated by the current popularity of home renovation.

Nevertheless, many of the issues we have identified are relevant in other countries that used asbestos. a

Box 2 ●

In the base year for calibrating our model to the detailed exposure data (2013), we assumed the following, based on the exposure profile in the data

●

452 occupational mesotheliomas from waves one and two

●

63 environmental cases from waves one and two (eg families exposed to dust brought home on a worker’s clothes, or exposure living near asbestos mines and factories)

●

193 wave three cases, including background cases

●

708 cases in total.

Box 3 The IFoA Asbestos Working Party risk relativities by type of asbestos, as used in our model, are: Blue

20

Brown 16 White 1

Figure 1: Consumption by type

Figure 2: Asbestos handling factor

Figure 3: Wave model

Figure 4: Overall range analysed

July 2016 • THE ACTUARY 27 www.theactuary.com

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Roshan Perera is a partner and Yuen Leng Chin is a principal consultant within NMG’s Actuarial Consulting Solutions practice

in 1985, there were 15 composite insurance companies in operation by the turn of the century. Throughout this period of liberalisation, Sri Lanka was ravaged by a civil war, which curtailed foreign direct investment, resulting in most of the market expansion being led by domestic insurers, with very little exposure to international development.

Up until 2010, over 60% of the market belonged to three of the 17 insurers operating at the time. Figure 1 (p29) shows the gross written premium (GWP) growth rates of the UK and Sri Lankan markets over the period 2009-2015. Surprisingly, this insular oligopoly was the home to some of the most disruptive insurance propositions seen recently in Asia.

Spotlight on Sri Lanka Yuen Leng Chin and Roshan Perera put Sri Lanka under the spotlight to highlight some of the innovations originating from its general insurance market and consider the future of disruptive development in light of recent regulatory reform

Emerging markets ‘leap frog’ in terms of evolution. They have a tendency for either rapid development without the legacy issues or regulatory barriers that may inhibit growth and innovation as compared to the more mature markets. As a result, emerging markets are often early adopters of technology and home to innovative product development and propositions. Mobile phone and internet users are omnipresent, largely driven by affordable products and services.

Some of the offerings in the telecommunication space have caught up with, or even exceed, those of ‘mature’ markets. It is common, for example, to find domestic broadband speeds of 1,000mbps in South Korea, while a 10th of that speed is considered fast in much of the UK. There is also evidence of this type of progress in insurance markets in emerging and developing countries. Sri Lanka is a good example of a dynamic and vibrant insurance market that has embraced technology while undergoing significant regulatory reform.

A brief history Following the establishment of a state insurer in the early 1960s, the insurance industry in Sri Lanka was a virtual monopoly until the 1980s, when the market was eventually liberalised. After liberalisation of the market

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On-the-spot claims settlement As with most countries in the region, the motor class of business dominates most insurers’ portfolios, accounting for approximately 65% of gross written premium. Following a detariffication of motor and fire rates in 2002 and 2005 respectively, the motor insurance market entered a state of intense price competition. As with the evolution of the motor market in the UK, motor insurance products in Sri Lanka became increasingly more commoditised, with customers continuously seeking the lowest premium from insurers eager to capture market share. This market trend was the catalyst for a product innovation that shifted the focus of motor insurance away from being a commodity product to a proposition-based product.

A private insurance company in Sri Lanka introduced the concept of ‘on-the-spot’ claims settlement for its motor policyholders. The idea for the product was relatively simple.

Customers who met with an accident would contact the insurance company, who would immediately dispatch a claims assessor to the scene of the accident to assess the damage and settle the claim on the spot, in full. Many Sri Lankan customers, who valued the certainty of an upfront claims settlement, switched to this company almost immediately, doubling its market share within the first two years of introduction from around 20% to 40%. The effect of this simple product innovation was profound in the Sri Lankan market, resulting in a shift in focus to service; in this instance, the convenience and speed of the claim settlement, from price.

Almost 10 years later, the company that introduced on-the-spot claims settlement continues to dominate the motor insurance market, and is also able to charge higher average premiums than its competitors.

This is impressive in a market where most companies competed purely on price. What’s more, the practice of fast claim settlement has become the industry norm – where the key performance indicators of the claims manager and loss adjustor are now based on hours, PICTURE: REUTERS

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and this has defined the payment patterns for motor property damage in Sri Lanka. Figure 2 (below) shows the extreme short-tail nature of motor business in the market, with over 90% of the claims being reported and almost 80% of the claims being paid in the first year.

To remain competitive in Sri Lanka, companies continued to innovate and leverage technological advances. The latest form of on-the-spot claims settlement involves a simple text message, notifying the claimant of their claim approval and availability of funds for withdrawal; a clever use of push notifications.

Another company in the market recently developed the concept of ‘click-and-go’, where policyholders would take pictures of the damage using their smartphones and upload to the insurance company directly, eliminating the need for a claims assessor altogether.

Economic stabilisation and reform These waves of innovations started during the civil war. At the time, Sri Lanka was in a high-interest-rate environment (18%+), which in turn led to a healthy investment income buffer for those companies able to attract premium income (see figure 3). As such, there was latitude for companies to experiment with pricing and propositions in a way that perhaps would not be possible in a tightly regulated low-interest environment.

Following the end of the civil war in 2009, and a stabilisation of the economy, insurance companies were forced to revisit their strategies and move away from a top-lineonly focus as underwriting results became more transparent. This also coincided with significant regulatory reform. In the past three years alone, the Sri Lankan insurance industry has dealt with a splitting of composite licenses, the introduction of a risk-based capital (RBC) solvency framework, and a mandatory listing on the stock exchange. These developments have fundamentally changed the insurance landscape in Sri Lanka.

As the market has matured, we have also seen evidence of a change in the claims profile for the motor insurance class, with tails lengthening for the bodily injury component,

possibly owing to a better understanding of the cover, or an increased propensity to claim. As longer tails are associated with greater volatility, companies have expressed concerns on the expected claims and accompanying expenses that follow. Under the RBC regime, these higher reserves will also lead to higher capital requirements.

The market leaders are now focusing on developing and strengthening competencies in an attempt to move beyond compliance and focus on technical underwriting in a soft market. The recently introduced RBC framework also requires any strategic decision to be supported by capital and any premium deficiencies to be identified.

Pushing the boundaries While regulatory compliance has promoted a number of technical changes in the Sri Lankan insurance industry in recent years, resulting in a much more robust market, competition is still fierce and companies continue to seek a competitive advantage through product innovation. New propositions such as loyalty schemes and usage-based insurance, using locally developed hardware and software, are currently under consideration.

With the increased availability of affordable technology and digitalisation, it is now possible to buy insurance using a smartphone or track driving behaviour via an application.

Our experience is that emerging markets still appear to embrace innovation despite tighter regulatory frameworks. Competition will continue, requiring insurance companies to innovate to stay relevant. Successful insurers have been able to leverage technology and create significant first-mover advantage, despite rapid adoption by competitors of ideas that appear to work.

These markets are also now looking to best practices internationally and new disruptive technologies to make improvements and create sustainable businesses. Some may call these gimmicks or short-term fads, but, just perhaps, there may be a thing or two the more mature markets could learn from their emerging market counterparts. a

Figure 2: Sri Lankan motor rates

Source: Based on NMG proprietary information and includes 75% of GWP of Sri Lankan motor market

Figure 1: GWP growth rates

*UK 2015 GWP growth rate is based on average growth rate of past five years. Source: www.ibsl.gov.lk & www.oecd.org

“Emerging markets still appear to embrace innovation despite tighter regulatory frameworks.

Competition will continue, requiring insurance companies to innovate to stay relevant”

NMG Consulting’s Actuarial Consulting Solutions practice specialises in providing strategic and actuarial advisory services to emerging and developing insurance markets in Asia

Figure 3: Interest rates

Source: Standing lending facility rate from www.cbsl.gov.lk

July 2016 • THE ACTUARY www.theactuary.com

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Memoria Lewis is membership director and Caryn Chua is South-East Asia representative at the IFoA

South-East Asia specific Memoria Lewis and Caryn Chua talked to members in Singapore and Malaysia to ask about the ASEAN Economic Community and how they think the region will advance and implement changes

Find interviews and profiles on the IFoA website under Leadership Insights: Glenn Williams, Chin Tze How, Ken Ng and Nishit Majmudar 30

THE ACTUARY • July 2016 www.theactuary.com

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The Association of Southeast Asian Nations (ASEAN) was established on 8 August 1967. The 10 member countries are Brunei Darussalam, Cambodia, Indonesia, Lao PDR, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam.

The first ASEAN Economic Community (AEC) Blueprint, signed in 2007, served as a comprehensive masterplan to chart the region’s journey towards the formal establishment of the AEC on 31 December 2015. The AEC’s vision is to integrate all 10 countries in South-East Asia and create a single highly competitive economic region and production base through the free flow of goods, services, investment, skilled labour and capital.

According to the official ASEAN website, this formal establishment was a major milestone in the regional economic integration agenda, offering opportunities in the form of a huge market of US$2.6 trillion.

Collectively, the region is the seventh-largest economy in the world, and, with a population of over 622 million people, ASEAN represents the third-largest market base in the world, behind only China and India.

Challenges and opportunities Members in Singapore and Malaysia were asked for their views on the key challenges and opportunities for the financial services industry, and what a realistic timeframe would be for implementing any proposed changes across the region.

The main challenge is that all the countries are at different stages of development, resulting in polarisation of standards and quality across the region. Nishit Majmudar, CEO of Aviva Singapore, proposed that economic integration across many countries is bound to be complicated owing to differences in politics, tax regimes, financial products, currencies, cultures and languages. Glenn Williams, CEO of AXA Life Singapore, admitted that the AEC could accentuate the range of disparities among the countries: “The economic community will highlight the range of maturity even further, with Singapore being the most developed,”

he says. “The key challenge will be that less mature markets will not catch up to Singapore very quickly, and Singapore will not relax its regulatory regime – so how do you harmonise that discrepancy?”

Synthesizing regulation Harmonising regulatory regimes across all countries is another hurdle to overcome as this will take some time before being approved and implemented. However, regulators are starting to look at these discrepancies in order to strengthen capital requirements. On a global level, the International Association of Insurance Supervisors (IAIS), which represents all insurance regulators and supervisors, is advocating a global framework for insurer capital requirements. Wan Saifulrizal Wan Ismail, president of the Actuarial Society of Malaysia, confirmed that most of the regulators have developed some form of risk-based capital framework. Malaysia, Singapore and Thailand have already implemented theirs, but these have not been implemented consistently across the entire jurisdiction. The risk here is that capital requirements that are too stringent may discourage insurers from taking risks in emerging economies.

In terms of human capital, free movement of labour will help elevate markets as talents learn new skills in more mature markets and take those back with them to their home markets. This is already happening in multinationals in relation to actuarial skills.

Ken Ng, CEO of NTUC Income Singapore, believes the IFoA’s qualification is an international passport and considered a brand that companies and regulators trust.

Therefore, the AEC integration is potentially only a secondary issue to actuaries, as there is already active movement across the region owing to the high demand for actuarial skills.

However, Matthew Maguire and Raymond Cheung, president and honorary secretary of the Singapore Actuarial Society respectively, cautioned that, under the AEC, it could allow an actuary from one member country to sign off on accounts in another member country, and this could give rise to complications.

In order to meet the increasing demand of actuaries, the ASEAN Actuarial Talent Development Working Committee was formed in 2015, under the ASEAN Insurance Education Committee, with the mandate to discuss and propose solutions to bridge the actuarial talent gap within the region.

The working committee presented to the ASEAN regulators during the ASEAN Insurance Council meeting, held in Phnom Penh in October 2015, on some future plans to address the gaps.

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So who will benefit in a new harmonised economy in South-East Asia?

Heng Zee Wang, deputy general manager of AIA Malaysia, believes that the dynamic changes of local markets and their populations will drive growth, and that an emerging middle class will want to buy more.

Alex King, managing director of Pacific Life Re, agreed adding: “Countries such as Thailand are starting to bring in a wider variety of propositions, which is good for consumers and net positive. There will be more choice, more products, and the entire industry should grow.”

Influence and integration Other winners, according to Wan Saifulrizal, will be large companies that are able to co-ordinate activities better and adjust to competition in the local environments.

Chin Tze How, chief product officer of Allianz Malaysia, felt that regional players will do well in the integrated markets and that they will influence business in less developed countries.

On the flipside, there are some countries that are showing signs of protectionism

against global brands, which goes against the AEC’s vision.

Lastly, when will integration of financial systems take place? There was a consensus that not much will happen in the short term.

There is a clear intention to drive closer relationships between member countries, but in reality there will be a lot of discussions before any true integration takes place.

It is envisioned that the formal establishment of the AEC in 2015 was not a static end-goal, but a dynamic one that requires continuous reinvention of the region to maintain its relevance in an evolving global economy. The AEC Blueprint 2025 has been subsequently introduced to guide the ASEAN economic integration from 2016 to 2025.

Looking at the decade ahead, ASEAN will strive to build on the early gains from AEC 2015 and be forward-looking in anticipating new opportunities and challenges. Effective planning and adequate resources are imperative to ensure successful outcomes of the community-building process and thus contributing to the aim of shared prosperity in future years. a

“Countries such as Thailand are starting to bring in a wider variety of propositions, which is good for consumers and net positive.

There will be more choice, more products, and the entire industry should grow”

July 2016 • THE ACTUARY 31 www.theactuary.com

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Sharanjit Paddam is principal, actuaries and consultants, Deloitte Australia, and Kate Mackenzie is manager, investment and governance, at The Climate Institute

Will climate change make things go under down under?

After the UN conference in Paris last year, it is increasingly clear that financial institutions need to take action on climate change. But how exactly will this issue affect financial institutions, and what actions can and should be taken, as the severity and frequency of events gathers pace?

Sharanjit Paddam and Kate Mackenzie discuss these challenges for Australia

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In 2014, Henri de Castries, chairman and CEO of AXA, said: “Climate risk for us is neither an ideological or theoretical issue: it is a core business issue, as we are already seeing the impact of increasing weatherrelated disaster risks. Extreme weather events are increasing in intensity and severity. Last year alone, AXA paid out over €1bn globally in weather-related insurance claims.”

De Castries’ comments provide an important perspective on climate risk – it is fundamentally a financial and economic risk to financial institutions. So it is not surprising that regulators are taking an interest. Mark Carney, governor of the Bank Of England, and chairman of the Financial Stability Board, stood in front of the Lutine Bell at Lloyd’s of London – the spiritual home of insurance – and announced to the assembled captains of the industry that climate change was real: “The combination of the weight of scientific evidence and the dynamics of the financial system suggest that, in the fullness of time, climate change will threaten financial resilience and longerterm prosperity.”

Carney’s comments speak directly to the nature of climate risk – it is a systemic and pervasive risk. The Prudential Regulation Authority’s (PRA) recent paper on The Impact Of Climate Change On The UK Insurance Sector, spells out the three key ways climate change poses a risk to financial institutions: ● Physical risks – the impacts today on insurance liabilities and the value of financial assets, which arise from climate and weather related events, such as floods and storms that damage property or disrupt trade ● Liability risks – the impacts that could arise tomorrow if parties who have suffered loss or damage from the effects of climate change seek compensation from those they hold responsible. Such claims could come decades in the future, but have the potential to hit carbon extractors and emitters the hardest – and, if they have liability cover, their insurers ● Transition risks – the financial risks that could result from the process of adjustment towards a lower-carbon economy. Changes in policy, technology and physical risks could prompt a reassessment of the value of a large range of assets as costs and opportunities become apparent.

Transition risks Transition risks are perhaps the most complex of these three mechanisms, as they often arise as secondary effects, and rely on a chain of events in order to pose a risk for the industry. For example, consider the risks of investing in carbonintensive industries. The International Energy Agency has noted that: “No more than one-third of proven reserves of fossil fuels can be consumed prior to 2050 if the world is to achieve the ‘less than 2 °C’ goal, unless carbon capture and storage (CCS) technology is widely deployed”.

Investors in fossil fuel industries either assume that their assets will be among the one-third that gets burned; or that governments will not take significant action to restrict emissions from fossil fuels; or that

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the as-yet unproven CCS technology will take off. Even Bayes would have trouble stringing together the probabilities on that one.

The PRA report also makes it clear that the later any emissions reductions take place, the faster the economy will have to transition away from fossil fuels, and the more likely we will have a disorderly transition, with associated sudden drops in asset values.

Climate then poses a risk to financial institution investments, particularly where those investments are in carbon-intensive industries. However, this is not the only risk to investment values from a transition to lowcarbon economies.

Battery storage technology is poised to disrupt both the energy generation and the energy distribution sectors. Here in Australia, a home without rooftop solar panels is becoming a rarer and rarer sight. If this is combined with the take-up of batteries, most homes would be able to disconnect from the grid entirely. So even green energy distributed through poles and wires faces a threat from even newer technology.

Physical risks The agricultural sector is also exposed to climate risk. Changing climate will change the

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viable regions for different plant species, and also the distribution of pests and diseases.

This is already having an impact on Australia’s wine industry.

Australia and many other countries will see an increase in tropical diseases, which will result in significant changes to both health needs and how our healthcare is funded, including private health insurance. This will be exacerbated by increased deaths from heat waves.

As ocean temperatures continue to rise with the changing climate, we will also see changes to the distribution of marine life.

Today in Australia, the northern Great Barrier Reef is over 90% bleached, and 35% already dead. Not only is this a devastating loss in itself, but the impact on our tourism industry will be significant.

Physical risks are already an issue worldwide. The PRA report notes increasing evidence of an increase in the frequency and severity of weather related events. Out of all the developed nations in the world, Australia is the most exposed to natural disaster risks.

Climate change will lead to sea-level rises that will increase the threat of cyclones, floods and storm surges to coastal property.

As those threats increase, insurance

“Australia and many other countries will see an increase in tropical diseases, which will result in significant changes to our health needs and how our healthcare is funded, including private health insurance”

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“Ultimately, we will see demographic change as people change where they live in response to climate change.

This will result in changes to our infrastructure needs, and the value of existing infrastructure assets”

becomes unaffordable and eventually properties become uninsurable. In a worst-case scenario, this may well trigger a drop in property values, and increased defaults on mortgages.

Climate risk transforms to credit risk, and the resulting losses to bank assets could well rival the worst of the financial crisis.

The property sector is likely to be increasingly exposed as cyclones start to move further south, into areas that do not have building standards designed to withstand them.

Ultimately, we will see demographic change as people relocate in response to climate change. This will result in changes to our infrastructure needs, and the value of existing infrastructure assets. As well as living elsewhere, people will work in different industries, disrupting employment patterns.

So how significant will this be? The mining, construction, housing, health, manufacturing, agriculture, tourism and energy sectors make up nearly 50% of gross value added in the Australian economy. While it is unlikely that the full 50% of these sectors will be exposed to climate risk, other sectors such as financial services will also be affected by climate risk through secondary effects.

Liability risks The PRA report has much to say on liability risks arising from climate change, and especially the potential similarities to the way asbestos liabilities emerged in the past. Predicting the outcome of legal decisions is not for the fainthearted. However, the potential for a single court decision to open the floodgates on further claims cannot be ruled out.

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Responding to climate change Up to now, we have seen a limited response to climate change from financial institutions here in Australia. Much of the response has been about corporate and public relations rather than an integrated risk management strategy.

Under an enterprise risk management framework, the starting point in managing any risk is identification and measurement. It is unclear if banks, insurers and other financial institutions have begun quantifying their risk, because there has been very little detailed disclosure to date. The FSB’s Climate Related Financial Disclosure Taskforce is developing a framework for disclosure. While this is likely to be a voluntary disclosure in the short run, it is very likely that they will become compulsory as climate risks become climate events, and regulators are forced to take action.

There is an opportunity for financial institutions to establish credibility with investors and customers, and a competitive advantage by actively managing their exposure to climate risk through an integrated climate risk strategy.

The tools available to financial institutions are rapidly increasing in sophistication. Here in Australia, a website has been launched to enable home owners to assess their risk to coastal flooding: coastalrisk.com.au/. The website includes detailed maps and climate scenarios allowing users to understand the risks posed.

Financial institutions are already exposed to climate risk. Banks have already written mortgages for homes that are exposed to increasing coastal erosion. Life insurers have already sold policies to people who may see their health deteriorate and mortality increase.

Paradoxically, general insurers who write short-term policies are likely to be the least exposed to physical risks, as they have the option of walking away. However, when the vast majority of residential housing in Australia is close to the coast, general insurers will face decreasing revenues as well as increasing claims. And that is before we even consider the reputational damage to insurers from leaving sections of the community without coverage.

An integrated climate risk strategy would allow banks to explore mitigation strategies.

These could include defensive underwriting, whereby lending criteria start to exclude highly exposed properties. For properties where there are viable resilience measures, such as retrofitting cyclone protection, banks can offer loans to their existing customer base to fund adaptation measures.

Investors, such as pension funds and life offices, can also consider the financing of new technology – for example, loans to fund the installation of solar panels, new infrastructure investments, and green bonds to finance renewable energy. Bloomberg recently estimated that the current fossil fuel industry consists of $5trn in assets. That’s a huge opportunity for new investment. a GETTY

28/06/2016 12:19

In addition to working towards my CERA qualification, I am a budding entrepreneur. I’m keen to minimise the uninsured and underinsured market in Sub-Saharan Africa – Winnie Badiah

I believe that one of the most powerful learning tools is the simple exchange of experiences and new ideas... and the best way to understand it is to un In today’s dynamic and evolving gather our different ga market, actuaries are presented with h st strengths and more complex challenges and greater er sk skills together opportunities to add value and Abrantes – Carla C expand their influence – Emale Laurant

The international actuary The IFoA is recognised worldwide as a leading player in promoting professionalism, developing educational standards and encouraging research within the finance and insurance sectors.

Actuaries can be found everywhere, and their skill set is growing in demand; not only in traditional insurance markets but also in other areas of practice, such as banking, risk management and the environment.

In every issue, we seek to address topics relevant to all members, and welcome contributions from

around the world. With The international actuary, we aim to build on this and shine a light on the risks and challenges in parts of the world we don’t always hear from.

This serves as a reminder of the growing global influence of our profession.

We also hear the views and experiences of students and newly qualified actuaries living and working in all corners of the world, highlighting the diversity and richness of our profession.

To read more from our international actuaries, visit www.theactuary.com/international

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28/06/2016 11:45

Carla Abrantes is a student working at EY in London, and is originally from Brazil

Carla Abrantes

I am from Rio de Janeiro, Brazil, but I also have a Portuguese background. Ever since I left Brazil for the first time in 2008 I realised I love travelling because it allows me to see the world with my own eyes, make friends from different cultures and gain experiences for life. Another passion is dancing because it helps me to relax after a long week of work and study.

Which actuarial field do you specialise in ?

While working in EY Brazil, our team was so small that we didn’t have such a breakdown so we would work in all of the actuarial fields, but mostly pensions. However, when I moved to the UK in October 2015 I decided to give myself the opportunity of a new beginning and chose to focus on non-life.

Why did you decide to study this degree?

During high school I discovered my fondness for numbers and I was sure that I wanted to purse a career where I could develop my mathematical skills. After reading a Brazilian magazine called the Student’s Guide that described the main activities of many professions, I decided to become an actuary.

Which actuarial society are you a member of?

I am a member of both the Brazilian Institute of Actuaries and the IFoA. THE ACTUARY • July 2016 www.theactuary.com

Which actuarial fields are most dominant in Brazil, and why?

Pensions, life and health. The population as a whole suffers from a lack of good public healthcare and so the priority of every Brazilian citizen is to have a private health plan. The social security system benefits are also not enough to guarantee a reasonable living for seniors and so there is an increasing awareness that it is necessary to start saving for the future during the early stages in life.

Tell us a bit about the area in which you work?

While working in Brazil I was focused on the actuarial assessment of post-employment benefits in accordance with IFRS standards.

However, since I arrived in the UK I have been involved in non-life reserving and have just started working on a Solvency II Pillar 3 project.

What kind of support do students get in your company, and elsewhere?

In Brazil, in order to be a fully qualified actuary we have to complete our BSc in Actuarial Science, and pass one single exam from the Brazilian Actuary Institute. The international exams from The Society of Actuaries (US) and the IFoA are becoming popular as an additional proof of technical capabilities, however, as it is not mandatory in Brazil, the companies tend

not to give any, or very little support. Here in the UK, EY give us a great package including study leave and exam support. As far as I am aware, it is better than many consulting firms and major insurance companies.

Are you involved in any actuarial activities outside of your day job?

I have only recently moved to the UK and am still taking my time to settle down and organise my working and studying life before I commit to other activities.

Could you tell us about an interesting project you have worked on?

I lived in Angola for two years. The activities included designing and implementing short, medium and long-term remediation actions in areas such as revenue, budget and treasury.

These were two of the best years of my life because I had the chance to work with so many people from all over the globe that became my friends, and at the same time, I had the once in a lifetime opportunity to be in such a unique place as Africa.

What do you believe are the social and economic drivers for actuarial work in Brazil?

In Brazil, the 1988 Constitution exacerbated the imbalance between contributions and SHUTTERSTOCK

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benefits, granting a group of benefits without the contributions counterpart. Mistakenly, this lack of a link makes the employee interpret the contribution as a tax and the retirement pension as a right.

Today, the social security deficit precludes a reform with a decrease in the government participation. The balance in the social security account is impossible to achieve unless there is implementation of a methodology based on actuarial calculations.

However the politicians are not willing to take non-popular decisions.

What is the reputation of actuaries and the professional body in Brazil? What kind of activities does the professional body engage in to promote the profession and its actuaries?

There is one annual event and a few technical committees aiming to develop actuarial work demanded by the market or government agencies. Recently the institute has been trying to establish a constant training agenda so all its members are aware of the most important market and technical topics.

How do you see the role of an actuary evolving in the future – can you see actuaries working outside their traditional sectors?

Definitely yes. I believe that one of the most powerful learning tools is the simple exchange of experience and thoughts. Our world is getting more interdependent, and the best way to understand it is to gather our strengths and different skills together with the main purpose of building a better working world.

How often and in what way do you use social media?

I am not a big fan of social media for personal use but I tend to use it for professional purposes, as I can be on top of the world’s breaking news and market information almost instantaneously. Being connected definitely impacts my business understanding as a whole.

What have been the influences that shaped your career decisions to date?

I have always felt the need to be constantly learning, and whenever I was feeling comfortable it was time to change something

because I believe the world is such a huge and beautiful place with numerous options and we should seize the maximum it has to offer.

I built my learning path by changing offices three times in Brazil, living in Angola for two years, and taking a year of nonpaid leave to pursue a MSc in Actuarial Science in the UK after being granted the Chevening Scholarship funded by the Foreign Commonwealth Office.

Could you tell us about your immediate and longer term goals?

My immediate goals are to qualify and build a strong knowledge of the non-life market in the UK. The longer term goals would be to continue learning something new every day because that’s how we grow as a person and as professional.

My immediate goals are to qualify and build a strong knowledge over the non-life market in the UK. The longer term goals would be to continue learning something new every day because that’s how we grow as a person and professional

How will you celebrate the day you qualify?

I would probably give myself a few trips as a reward and start looking for something new to focus on. Challenges are the fuel of my life.

What was the motivation behind the decision and how long do you envisage staying abroad?

So far, I’m during my second work experience abroad and I’m starting to realise that being abroad is like being home for me.

As I have mentioned before, I am really curious about the world and different people and places, so every chance I have to explore it I will definitely take.

My first long experience abroad was in Angola where I lived for two years under restricted conditions due to the sensitive nature of the project. It was my decision to leave the project after two years as I realised that the most precious power we all have is freedom and I was missing mine.

After I finished my MSc degree I realised my learning curve was slowing down in Brazil.

That’s when I started planning my move to the UK, taking one of the hardest decisions in life; to literally take one step back in order to take two steps forward.

I basically re-started my entire career almost from scratch but I am really happy with my work here and I feel I am blessed for being able to have such a great team.

What are the main professional differences between Brazil and the UK? Working in Brazil and the UK is completely different mainly because the market is a lot more solid here. Brazil is trying to keep up-to-date with the accounting best practices but it is really behind in terms of Solvency II, for example.

As a third-world country, Brazil still has huge market penetration potential but this is highly correlated to the economy, which is currently walking towards the worse recession in Brazilian economy of all time. In summary, as the market is a lot smaller, so is the complexity of it.

How did you find this opportunity?

EY is a global company and I have been working for them in Brazil for many years. After I made my decision I spoke with one of the partners and he got in contact with the UK team.

By chance I was on holidays in the UK and came for an interview and everything went well.

They made me an offer and I accepted.

What do you say when asked, “What is an actuary”?

I try to make my response as simple as possible by just saying that I measure and manage risks for insurance companies and pension funds.

Normally people reply “this sounds complicated” and the topic ends, but for some reason if the chat continues, I use the traditional car insurance pricing example.

July 2016 • THE ACTUARY www.theactuary.com

Valeria Huerta Acosta is a student from Mexico, working at Aon and studying at the Universidad Autónoma de Nuevo León

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Valeria Huerta Acosta I was born and grew up in Juárez, Chihuahua, but I moved to Monterrey because it was the ‘nearest’ university in Mexico that offered the actuarial science programme.

I’m very outgoing. I really enjoy talking and meeting new people. I like swimming and running, and I just ran my first half marathon last month. I live with a friend, who is already an actuary, from my university. Last friday was my last class in university, and I’m very excited about what is coming next, though I still can’t decide what to do: a masters degree, trainee programme or to keep working for a couple years.

Which actuarial field do you specialise in?

Pensions and credit risk, because of my new job (of two months) and my internship.

Why did you decide to study this degree?

I liked the way mathematics turned out to be something more ‘down to earth’ compared to any other fields that apply maths.

Which actuarial society are you a member of?

I’m a student member of the AMA – CONAC (Asociación Mexicana de Actuarios – Colegio Nacional de Actuarios).

Which actuarial fields are most dominant in Mexico?

Life, health and car insurance.

Tell us a bit about the market that you work in.

I make actuarial valuations of labour liabilities.

The market in this area is not big, there might be lots of small consultancy firms, but in Mexico there are only three big companies who get most of the big clients.

What kind of support do students get in your company, and elsewhere in the market?

I think my company was very supportive, because they decided to hire me even when I still had a couple months to go at university.

Currently they don’t have any interns (at least in my area of the city), but they used to have one two years ago.

Could you tell us about an interesting project you have worked on?

I worked (together with my team) on a project for my applied statistics II course, where

we examined the monthly deaths in Mexico over the last 22 years and tried to forecast how mortality will behave for the next three years. We used the ‘R’ and the ‘LOESS’ model.

It was interesting because we found some stationarity, trends and white noise within.

What do you believe are the social and economic drivers for actuarial work in your region?

Pension issues and saving behaviour.

What is the reputation of actuaries and the professional body in your country?

The profession is not very popular in Mexico, there might be around 20,000 actuaries.

They have some research projects with government institutions.

How do you see the role of an actuary evolving in the future?

I definitely think we will need to open ourselves up to new sectors. I believe there will come the day when some areas are not such a matter of attention or popular anymore (like risk management, for example), and new issues will come to the fore.

We already ‘know’ how the future will be, there will be a very big older population. To cover this new market is our duty.

I think we need to keep developing all kinds of skills, especially programming skills.

How often and in what way do you use social media?

I usually do not post much, but I do look at what my friends and groups I follow post.

I think it is a good way to stay in touch with other actuaries I have met.

What have been the influences that shaped your career decisions to date?

I pay a lot of attention to what my professors say in class, their recommendations and experiences.

Could you tell us about your immediate and longer term goals?

I would like to study for a masters and to be a member of another country’s actuarial society such as the Society of Actuaries or the IFoA. If you have travelled abroad to work or study, what are the main professional differences between Mexico and where

We already ‘know’ how the future will be, there will be a very big older population. To cover this new market is our duty.

I think we need to keep developing all kinds of skills, especially programming skills

you have worked and studied?

I went to Germany for a year and two months for an exchange programme. I discovered how much harder it is to be an actuary there compared to Mexico. Here we must only study a five-year-long bachelor degree and after that keep on with further education, like small courses.

In Germany one should have a related degree, preferably a masters, pass 11 exams and have a three-year-long experience in any actuarial sector. I stayed in Gottingen, where I studied for eight months, and Braunschweig, where I did an internship at Volkswagen Financial Services What do you say when asked, “What is an actuary”?

A mathematician that manages and studies any kind of risk that might have financial impacts, through statistics and probability.

How will you celebrate the day you qualify?

I will celebrate with a nice party and dinner with family and friends, or have a great vacation.

July 2016 • THE ACTUARY www.theactuary.com

Carlos Durán is a student from Colombia, working at Munich Re in Bogotá

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Carlos Durán I am an industrial engineer from Colombia with two and a half years of actuarial experience in the reinsurance business.

My interests and skills are mainly focused to the technical and statistics area, however I have good commercial skills, which results in a good combination.

I am 23 years old and my passion is to do any kind of sports, especially surfing which I am a big fan of. I recently moved from a multi-line non-life pricing actuary role to a marine-specialised job.

I used to be one of the many people in Colombia that didn’t know anything about actuarial science, until I saw a very interesting job offer looking for an actuary.

Once I took the job and started to discover how my skills fitted the profile of an actuary, and the great growth opportunities I would have, I decided to continue my career to become an actuary as a long-term goal.

I am a member of the Society of Actuaries (SOA).

Which actuarial fields are most dominant in Columbia, and why?

The fields related to social security and mortgages.

Tell us a bit about the industry or market that you work and study in?

I have been working in the Latin-American market, and as an emerging market it is much less standardised than other markets, such as Europe or the US. This means that there are a lot of challenges but also lots of growth opportunities and innovative ideas to implement, which creates a good learning environment, as there are a lot of things yet to be achieved in the region.

What kind of support do students get in your company, and elsewhere in the market?

In my company, students get not only support with exam fees and study materials, but also study days – non-working paid days dedicated to study for an exam – and incentives such as salary increases for approved exams.

However, this is not a common situation in other companies within the market.

Could you tell us about an interesting project you have worked on?

I participated and was a finalist in a regional (LatAm) competition of operations research.

It was very challenging as we didn’t really have the required knowledge and didn’t know any of the team members either. Day-by-day we not only had to learn about operations research and the software we had to use, but also how to work as a team. At the end we got a very positive result and good lessons for the future.

What do you believe are the social and economic drivers for actuarial work in your region?

Throughout history, the main driver has been pensions issues and other business related to social security.

What is the reputation of actuaries and the professional body in your country? What kind of activities does the professional body engage in to promote the profession and its actuaries?

The Colombian Actuarial Society (Asociación Colombiana de Actuarios) is an accredited full member of the International Actuarial Society.

It promotes the profession by giving support to actuarial students and inspiring candidates with study materials and exam fees.

It is also linked with two universities to promote the masters programme for actuarial science.

How do you see the role of an actuary evolving in the future – can you see actuaries working outside their traditional sectors?

Risk management is something that companies from different sectors are investing in, and the desire to develop new techniques and assess risk better keeps increasing. Also, in a globalised world the actuarial skills are well suited to several industries.

How often and in what way do you use social media? How does it help your professional work as an actuary?

In addition to using social media for personal use, I have used it to stay in touch with colleagues in a less formal way. I recently got a new job that was offered by an ex-colleague, who is now my boss, because of the good relationship we maintained through social media, even though we were not working together any longer.

What have been the influences that shaped your career decisions to date?

My family and the desire to give back for all the

Once I had the job and started to discover how my skills fitted the profile of an actuary and the great growth opportunities I would have, that is when I decided to continue my career to become an actuary as a longterm goal

efforts my parents have made to empower and help me develop my career.

Could you tell us about your immediate and longer term goals?

My immediate goals are to continue developing my technical skills by gaining actuarial experience and passing my actuarial exams.

I am also interested in developing my commercial skills set.

Once I have both technical and commercial skills, as a longer term goal I would be interested in developing managerial skills and have a wellrounded profile.

Have you ever thought of moving abroad?

If so, are there any challenges you are facing with regard to this?

I am very interested in moving abroad, however the main challenge is that I have had great opportunities locally so far. Nonetheless, at some point I will look for more personal and professional growth by working overseas. I am interested in London, because now that I am specialised in marine business, I think it will be a very interesting market to learn and develop in.

What do you say when asked, “What is an actuary”?

It’s someone with, what has been considered to be several times, the best job in the world.

How will you celebrate the day you qualify?

With people that have seen my pain while studying for the exams.

July 2016 • THE ACTUARY www.theactuary.com

Michael Beck is an actuary at KPMG, Chicago, US, and originally from the UK

Michael Beck

I am a life actuary with five years’ experience with KPMG UK and am currently seconded to the US practice and based in Chicago.

Having finished my Masters in oceanography towards the end of 2008 I was struggling to find a job and one of my friends, who is an actuary, told me I should look into it. Having done applied mathematics and computer science as a large part of my degree it felt like a very logical place to continue doing things that I really enjoy and get paid for it. One year, and a job at a bicycle shop later, I started working at KPMG. Having spent my formative years in Scotland, I am very fond of the outdoors.

I am a keen skier and spent countless days skiing in the highlands of Scotland and across Europe. During the summer I can be found hiking or cycling. Now that I have moved to the USA I have had a number of backpacking trips in California and taken up Karate. As the beach is less than a 10-minute walk from my apartment some of my evenings are spent relaxing by the water reading up on trivia to stop myself being the ‘British guy’ who is useless at the weekly office team trivia night.

THE ACTUARY • July 2016 www.theactuary.com

Which actuarial society are you a member of?

The IFoA and the Society of Actuaries in the US. Which actuarial fields are most dominant in the US and why?

The market in the USA is very similar to the UK with a well-developed life and general insurance sector. The biggest difference is the very large health field, which is driven by the fact that universal health care is not provided by the US government.

Tell us a bit about the market you work in The market in the USA is similar to the UK in terms of products. The difference is in the regulatory framework around these products. In the USA the guidelines come from the National Association of Insurance Commissioners (NAIC) but states are allowed to define the rules in separately. While most follow the NAIC guidelines in setting the rules, some states are less inclined to do so (with New York being the most prominent).

Currently the regulatory regime in the USA for life business is statutory reporting and Risk Based Capital (RBC). Statutory reporting uses locked-in assumptions that are prescribed by the NAIC. These assumptions can change year on year but the values are defined ‘locked in’ by the product type and year of sale.

RBC is a factor-based model, and not shaped to the specific risk profile as accurately as the Solvency II model. Proponents of the system

argue that it focuses on the material risks faced by insurance companies, that it is simple and provides a suitable level of capital. This system was put in place in the 1990’s and as it has been given Solvency II equivalence there will be no rush to change it I am sure. As I learn more about this over time, I learn to appreciate the simplicity of it even if I feel Solvency II is a better approach.

The overall landscape of statutory reporting is in the process of changing to Principle-Based Reserving (PBR). PBR differs from the current regime in that all assumptions which a company has an influence over (expenses, mortality, asset returns) will be company specific. PBR is currently in place for variable annuities and during the first half of 2016, the NAIC received the super-majority required (approval from at least 42 States and 75% of the total U.S. premium) to approve PBR for life business. The impact of this is that PBR will (probably at time of writing) come into effect from 2017 for life business causing a big effort to make systems and products compliant. PBR is not being applied retrospectively to old business which means that US insurers are facing the logistical challenges of supporting valuations systems for both new and old business, and they will continue to do so for many years.

Could you tell us about a interesting project you have worked on?

Currently I am heavily involved with the introduction of PBR to life insurance products in the next few years. Having spent my early career SHUTTERSTOCK

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in the whirlwind of Solvency II implementation, it is interesting to see that companies are focusing on the modelling aspect of this and spending less time on documentation and reporting. This is very reminiscent of SII and we are pushing clients to build the reporting requirements into their plans from an early stage.

What are the social and economic drivers for actuarial work in the US? Currently there are two main drivers of significant importance in the work of actuaries. The Patient Protection and Affordable Care Act (a.k.a. Obama care) was signed into law in 2010, this helps provide healthcare coverage to everyone in the nation. This is a political hot potato and already Donald Trump (the likely Republican presidential candidate) has said that he would axe it. A number of big insurance companies have been pulling out of the exchanges recently, citing an inability to make a profit on the restricted premiums that they can charge versus the level of claims.

The other driver is PBR. The introduction of this regulation may turn out to be a game changer for the US market. Where companies are able to adopt early and sell products at a lower price will give them a big advantage. With PBR only being for new business, there is the possibility for well capitalised firms to become closed book consolidators and buy up the old books of other companies. Ultimately, time will tell exactly how this pans out but for sure it is going to be a market disruptor and some companies will thrive as a result.

What were the influences that shaped your career decisions to date?

There have been a number of influences on my career so far: a discussion with a friend who set me down the path of becoming an actuary; guidance and leadership for one of the partners at KPMG in the UK; and the exam process helped me to get an idea of what I liked and what I didn’t like within the traditional roles of an actuary.

Could you tell us about your immediate and longer term goals?

My immediate goals are to get a deeper knowledge of PBR and be a part of KPMGs core team dealing with this new regulation for clients as the insurance market goes through change over the next 3.5 years.

Longer term will depend on where in the world I decide to settle, being an actuary means I can work in many places; also retiring early and becoming a ski bum is a distinct possibility.

Have you thought of pursuing other academic/CPD qualifications, or joining other professional bodies?

If I stay in the USA for a prolonged period then I will join the American Academy of Actuaries which is required to sign off reports in the USA. Being an actuary today is an exciting time given the focus on diversifying the areas where we are employed, those actuaries who thrive will certainly be those who are engaging with external sources of knowledge and applying their actuarial mind-set to related problems.

What do you say when asked, “What is an actuary”?

Normally I keep the answer very high level and tell people that I work in insurance to assess risks, build models that determine how much car insurance is and make sure that companies are holding enough money to protect the policy holders. If someone asks more questions I go into more details but typically this results in blank looks very quickly when I get into Solvency II Pillar 1 requirements.

What are your experiences of living and working in the US? Having your actuarial qualification recognised around the world enables actuaries to be mobile. The IFoA has mutual recognition with nine actuarial associations around the world, including the Institute of Actuaries of India and the Society of Actuaries (USA). Mutual recognition in these countries is straightforward and should not require significant effort; where there is no formal mutual recognition you may still be able to get the local qualification quicker through some exam exemptions.

If you are going to work in the USA and UK for any length of time then you will likely need a visa and there are many different visa’s you can obtain. If you work for a company who is supporting a move for you then hopefully they will arrange for your visa and help prepare the documentation. The visa process can take a while with increased levels of scrutiny now being applied to those wishing to work overseas. Allow as much time as indicated by the embassy when planning a move – I finally got my visa three days before leaving the UK. Living in America is very easy for someone coming from the UK especially if, like me, you studied here during university. The most obvious difference is the size of the country, it is massive.

Living here means getting on a plane a lot, for both work and pleasure. While flying might be quick

Having your actuarial qualification recognised around the world enables actuaries to be mobile.

The IFoA has mutual recognition with nine actuarial associations around the world, including the Institute of Actuaries of India and the Society of Actuaries (USA)

and easy, one thing which is more challenging is public transport. In big cities the transport varies but outside of the cities often the only solution is to rent a car.

While public transport might not be the best, living here does have its perks. Sports in the US are a huge thing and so are BBQs. Chicago hosts some of the finest sports teams around, we have the Blackhawks (ice-hockey), the Cubs (baseball greats), the White Sox (another baseball team), the Bulls (of Michael Jordan fame) and the Bears (American football). Going to any of these events with friends is a great experience and always gives you something to talk about.

When it comes to working, the USA is a very big country and working for a consultancy means travelling. If you don’t like to travel then make sure to consider where you are going to base yourself.

Many of the major life insurers have offices on the East Coast while having satellite offices across the country as a legacy of acquisitions or lower operating costs. One of the other things that the British actuary has to get used to is time zones.

With the lower 48 split across four time zones scheduling meetings can be problematic at times and you will certainly miss at least one meeting because of this.

Besides the regulatory differences, the work culture is very similar to the UK, with New York being the most similar to London. Work here generally starts late and continues late. While I do not wear a waistcoat to work like some actuaries that I know, I always feel that I am dressed better than most and the business casual has still not worked its way into my wardrobe, but give it time.

July 2016 • THE ACTUARY www.theactuary.com

Justin Brenden is chief reserving actuary at Third Point Reinsurance Company, Bermuda and is originally from the US

Justin Brenden

After starting my career in New York with Ernst & Young, I moved to Bermuda in 2012 to join Third Point Re, a startup reinsurance company. While I thoroughly enjoyed everything had to offer when I was in my 20s, Bermuda now offers the ideal lifestyle that balances work and personal fulfilment.

My wife is also an actuary and we are currently expecting our first child.

Outside of work and family my main hobby is distance running and I am training for my tenth marathon. We also enjoy international travel and some of our favourite past destinations are Taiwan, Croatia, and Hawaii.

I have spent my whole career in nonlife or P&C, as we Americans call it. I had the benefit of going to the University of Wisconsin, which had a large actuarial programme and allowed me to learn a lot about the different fields. Based on that, I determined that non-life practice was more diverse and less prescribed, which attracted me.

THE ACTUARY • July 2016 www.theactuary.com

Which actuarial society are you a member of?

I am a Fellow of the Casualty Actuarial Society (CAS) in the US. I am also an affiliate member of the IFoA and I am currently in the process of completing my requirements for mutual recognition as an FIA. Which actuarial fields are most dominant in your country and why?

Historically, Bermuda has been heavily weighted towards non-life reinsurance, so most of the actuaries in Bermuda work in the non-life space. That being said, there has been a recent influx of life reinsurers moving to the island.

Tell us a bit about the industry or market that you work in?

The Bermuda reinsurance industry is incredibly dynamic. Given that this is a tiny country (50 square kilometres and 65,000 people) with a high concentration of reinsurance companies and professionals, you literally can’t walk down the street without meeting someone who works in the industry.

This makes for great professional networking and social opportunities. In addition, Bermuda has grown by responding to the changing needs of the market, so it’s generally on the forefront of new reinsurance market trends.

Are you involved in any actuarial activities outside of your day job?

I am the chairman of the CAS Casualty Loss Reserve Seminar Planning Committee, which is an annual conference focused on reserving that attracts 700+ attendees from around the world. This volunteer work has provided excellent opportunities to give back to the CAS membership, to stay current on what’s going on in the industry, and make strong connections with other volunteers on the committee. However, it does present challenges. I had no idea of the amount of work that goes into these conferences before being involved with this committee!

Could you tell us about a challenging project you have worked on?

For the last four years I have worked at Third Point Re, which started operations in 2012 and is one of the recent class of hedge fund sponsored reinsurance companies. It has been fascinating working here for two main reasons.

First, being in involved in a startup has allowed me to learn an incredible amount about how a reinsurance company operates, including the actuarial aspects. Second, working for a hedge fund sponsored reinsurer has given me an insider’s understanding of one of the major trends in the reinsurance market right now, which is towards taking more risk on the asset side of the balance sheet.

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What do you believe are the social and economic drivers for actuarial work in your region?

Bermuda is very reinsurance-centric, so the main driver of the market here is the global supply and demand of reinsurance.

Bermuda provides a very strong yet practical infrastructure to start and grow companies quickly in response to market needs.

Given that change is always occurring – whether it is due to major loss events, the financial markets, regulation, or emerging risks – the opportunities for companies and for actuaries in Bermuda will always be linked to the latest needs of the market.

What is the reputation of actuaries and the professional body in Bermuda?

Because it is a very small country with a very high concentration of actuaries, there is a strong level of recognition of the actuarial profession here. Everyone here knows what actuaries are, and that it is a challenging and rewarding profession. You even hear children and teenagers say that they want to be actuaries when they grow up.

How do you see the role of an actuary evolving in the future – can you see actuaries working outside their traditional sectors?

I think that it will become more common for actuaries to branch off from the traditional sectors.

However, the extent to which this happens will be dependent upon the adaptation of the actuarial societies as well as the candidates themselves. Actuarial education is so specific and slow-moving that this is one of the primary challenges we as a profession face.

In the UK the skill set of an actuary is being recognised across many nontraditional disciplines, is this true of the market you work in?

Bermuda’s economy is so heavily weighted towards reinsurance that the need for actuaries in other sectors is limited.

However, I do see more and more examples of actuaries working in other areas in the US. Specifically, I am seeing more actuaries working for large non-insurance corporations that have lots of self-insured liability.

How often and in what way do you use social media? How does it help your professional work as an actuary?

As a member of the ‘Facebook generation’ I am a frequent user of social media. However, I haven’t used it much in my professional work as an actuary. I do find it to be helpful when recruiting candidates and keeping the pulse of the job market.

What were the influences that shaped your career decisions to date?

My initial choice to be an actuary was a combination of playing to my strengths – good analytical skills as well as the ability to communicate – and identifying a career path with strong prospects (the demand for actuaries clearly exceeded the supply when I made the choice). Once I chose the career, my objective was to learn as much as possible while being opportunistic in choosing my roles. That approach led me to take my first consulting job in New York and to eventually move to Bermuda.

Could you tell us about your immediate and longer term goals?

I don’t believe in setting career goals that are too specific, since it is impossible to predict what opportunities will present themselves or where my future interests will lie.

That being said, in my current role I am looking to make an increasing contribution to the underwriting and management decisions that are made by the company, with a medium-to-longer term goal of moving towards an executivelevel position.

As an actuary have you experienced any challenges, new opportunities and benefits of being qualified?

The primary challenge of being qualified was making it through the exam process.

Even considering the investment in time and energy that the exams required, the benefits have significantly outweighed the costs. The benefits for me have primarily come in the form of outstanding professional opportunities as well as the satisfaction of doing good work in an area that I am well suited to.

What do you say when asked, “What is an actuary”?

I generally keep it simple and say that actuaries do the math behind insurance.

Because it is a very small country with a very high concentration of actuaries, there is a strong level of recognition of the actuarial profession here.

Everyone here knows what actuaries are and that it is a challenging and rewarding profession

While that isn’t an ideal answer since actuaries work in more than just insurance (and do more than just math!) I find that this response is the easiest for the average person to understand and doesn’t intimidate them (or scare them off). Depending on who is asking, I might go a step further and say that actuaries analyse risk in all sorts of situations and give a few examples.

What was the motivation behind the decision to move abroad?

My move to Bermuda was primarily motivated by a great career opportunity, but it has also allowed for an interesting adventure and a nice contrast to New York.

What are the main professional differences between the US and Bermuda?

Actuaries enjoy a much higher level of recognition and prestige in Bermuda, given that there are so many reinsurance companies here.

How did you find this opportunity?

I was directly contacted by a former client.

What kind of support did you get in moving abroad from your potential employer?

My employer was very helpful in making it a smooth transition. They flew me down for a visit beforehand and gave me all kinds of advice about making the move.

July 2016 • THE ACTUARY www.theactuary.com

Shafique Bhunnoo is an actuary at the National Insurance Company, Curepipe, Mauritius

Shafique Bhunnoo

Travelling is in the family. My actuarial qualifications have allowed me to continue this tradition and live and work in the UK, Dubai and now in Mauritius. My parents moved to the UK from Mauritius in the 60s.

We returned to Mauritius and then on to Zimbabwe in the 80s.

After completing high school, I returned to the UK to start my actuarial career. In 2006 we relocated to Dubai working in offices in 13 different locations within the region. In 2009 we moved to Mauritius to take up a position that serviced Sub-Saharan Africa. I have four children, two born in the UK and two in Dubai.

I specialise in life insurance but I also find myself managing and advising on non-life and pensions work.

I started off in pensions as a student, and then moved into life insurance ‘for a change’.

After four years there, I went to work for a medical insurance company before moving into life reinsurance.

Life insurance meets many social needs and yet the penetration of life insurance in many countries remains very low, especially in Africa. Savings is valued over protection and there is generally a lack of technical expertise in the life arena. As a profession there is a lot we can do to help the protection industry develop.

THE ACTUARY • July 2016 www.theactuary.com

Which actuarial society are you a member of?

I am a member of the IFoA and also president of the Actuarial Society (Mauritius).

Which actuarial fields are most dominant in Mauritius and why?

Pensions, as historically the main actuarial work has been pensions-related, with life insurers typically using foreign consultants for their actuarial work. Only the largest life insurance company has an actuarial department working on life insurance work, such as pricing and valuations.

Tell us a bit about the industry or market that you work in?

Mauritius is a small island in the Indian Ocean, but is technically part of Africa.

Africa itself is a vast continent and there are great differences between, and indeed within, the regions and countries of the continent.

Insurance penetration is generally sparse, and especially so in life insurance. Mauritius, though, has a well-developed insurance industry with long established companies.

We have the second-largest number of qualified actuaries in Africa (after South Africa), and two universities offering actuarial science degrees.

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Are you involved in any actuarial activities outside of your day job. If so, tell us about this activity and its benefits and challenges?

I am the president of the Actuarial Society (Mauritius). In practice I am also the social secretary, event organiser and CPD coordinator.

A student society has now been established and is providing some support.

The challenges have been finding time to organise and co-ordinate activities for the profession given the busy schedules of the working actuaries on the Island. The reward is the enthusiastic participation of the members when events are held, especially from the next generation of actuaries.

Could you tell us about an interesting project you have worked on?

The company I am working in was created in 2015, and effectively was the result of the nationalisation of the largest life insurance company in Mauritius.

A separate general insurance company has been set up along-side the life company.

The work in setting up these new companies has proved to be very interesting and challenging, but ultimately rewarding.

The role played by actuaries in these activities has been recognised as crucial.

What do you believe are the social and economic drivers for actuarial work in your region?

In many countries in Africa, the limiting factor is the size of the insurance industry. Many companies are too small to even consider employing an actuarial student, and it is not rare to find no qualified actuaries at all in the country.

Ultimately, the growth of the industry is a factor of the general economic and social development of these countries.

For Mauritius, the challenge is finding and generating enough actuarial work for the growing student population.

What is the reputation of actuaries and the professional body in your country?

Actuaries have a good reputation in Mauritius and there is a general awareness of the profession among the population. It is seen as prestigious profession and attracts highcalibre students. The awareness of the profession is mostly due to work of

individual actuaries, rather than activities of the society.

How do you see the role of an actuary evolving in the future – can you see actuaries working outside their traditional sectors?

In Mauritius, there are unfortunately not enough actuarial vacancies each year to cater for the graduates of actuarial degree courses.

As a result, the majority of graduates end up working in non-traditional fields.

We have many in banking, finance, the civil service (in various ministries) and in various industry roles – where their analytical and financial skills are put to good use.

We have one qualified actuary working in banking, one in off-shore finance and also one in real-estate development. We also have two CEO’s of life companies who are qualified actuaries.

How often and in what way do you use social media to help your professional work as an actuary?

Personally, I am not a user of Facebook etc, but the student society has an active FB page.

What were the influences that shaped your career decisions to date?

One of the main reasons for choosing the profession was to have an internationally recognised qualification that would allow me to work in various parts of the world.

I was introduced to the profession by an actuary in Zimbabwe, Mr Mark Hyde, [see our profile on Mark Hyde and Zimbabwe] who gave a career talk at my school and was very supportive when I went to see him for advice.

Could you tell us about your immediate and longer term goals?

My immediate goal is to see through the launch of the two new insurance companies.

Longer term is to more firmly establish the actuarial profession in the region.

Have you thought of pursuing other academic or CPD qualifications, or joining other professional bodies?

I joke that I have made a personal pledge to not sit any further exams since I qualified.

The irony is that while this has been true to the extent I haven’t taken any formal

Mauritus has a welldeveloped insurance industry with longestablished companies.

We have the secondlargest number of qualified actuaries in Africa (after South Africa) and two universities offering actuarial science degrees

courses, I have ended up doing a lot more reading and studying since qualification.

Fortunately much of this is also relevant for CPD, as one of my interests is keeping up with the latest in economics and finance.

Please let us know your experiences of living and working in Dubai and Mauritius The main motivation to move to Dubai was to broaden my experience of work and cultures.

The role was managing people and products in 13 different countries – from Nepal to Turkey, Egypt to Lebanon. I was fortunate enough to be headhunted for the role, but it was a medium-term goal of mine to work abroad and was something I was speaking with my employer about at the time.

In the UK, I had the opportunity to work with companies and colleagues in different countries in Europe and North America. I was thus already aware of subtle and not-so-subtle differences in business culture. I also had some exposure to the Middle East and therefore did have a good idea of what challenges and opportunities lay ahead. The common thread to the challenges was cultural differences – both in a business or company sense, and in a social context too. Business culture does differ between countries, but also within companies – particularly those with different nationalities.

What do you say when asked, “What is an actuary”?

We are the finance professionals who look to the future to protect your interests.

July 2016 • THE ACTUARY www.theactuary.com

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Emale Laurant is a student from France, working at SCOR, in New York, US

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Emale Laurant I grew up in Aix-en-Provence, in the southern region of France. I moved to the US more than 16 years ago. One of my passions since I was young is soccer. I am a Barcelona fan and of course love my team from my region Marseille. I also play soccer with friends once a week. I also enjoy exploring New York City, discovering new neighbourhoods, and trying new restaurants as I love food and wine. Travel is another passion of mine and I try to discover as many new countries as I can.

I specialise in property and casualty, with a focus on capital modelling. When I started college, my goal was to go to medical school.

I chose to major in mathematics with a minor in chemistry as I’ve always loved maths, and thought this would help to differentiate me from the more typical pre-med students.

During my senior year, one of my professors mentioned the actuarial field. At the time, I was living in Hartford, Connecticut where there are many insurance companies, and decided to apply for a job. My first actuarial job was for a healthcare company and I really enjoyed working there and finding out more about an actuarial career.

I decided shortly afterwards to take actuarial exams and pursue this field.

I am a member of the Reinsurance Association of America Actuarial Committee and Property Casualty Insurers, ERM & Emerging Risks Committee.

Which actuarial fields are most dominant in the United States?

In the US, actuaries can work in life, retirement, health or property and casualty; life is most dominant but property and casualty are growing rapidly.

Tell us a bit about the market that you work in?

I work in reinsurance. In fact, SCOR is the fifth global reinsurer. In the simplest terms, reinsurance is the insurance of insurance companies (the ‘ceding company’ under the arrangement), where a premium is paid to assume some or all of the risk the insurers have taken on in writing policies for their clients.

What kind of support do students get in your company, and elsewhere in the market?

SCOR offers support to students who are taking actuarial exams. The benefits are study hours which vary by exam level, reimbursement for exam materials, seminars and travel if needed. There are also exam-based salary increases to encourage students to pass exams.

Are you involved in any actuarial activities outside of your day job?

At the present moment, I volunteer as an exam proctor for professional exams. In my prior company, I often provided guidance to students taking lower level exams such as exam techniques, materials to use to study and seminars to attend.

I plan to be more actively involved with the professional organisation once I am fully qualified.

Could you tell us about a challenging or interesting project you have worked on?

In my previous job I helped to develop a casualty catastrophe model (man-made catastrophe). You can define this as the risk of large accumulation of losses from multiple insurance policies due to events caused by human error or negligence.

Examples of such events are asbestos, US pollution, large explosions, and so on. The purpose of the model was not to try to predict what the ‘next asbestos’ would be but rather to better understand portfolio exposure, and to better prepare and manage risk from future events of this nature.

What are the economic drivers for actuarial work in the US? The environment we operate in is constantly evolving to new socio, economic and political developments: changes in risk profiles, advances in technology, changes to climate. All of these changes impact the reinsurance industry and present many opportunities for actuaries to help better prepare and manage these new emerging risks.

What is the reputation of actuaries and the professional body in your country?

Actuaries are well-respected in the US as the profession has been rated for many years as one of the best jobs in America. The CAS and the SOA promotes the profession through research, seminars, continuing education and campaigns to ensure its members have the skillset, quality standard and professionalism to be valuable in an ever evolving environment.

How do you see the role of an actuary evolving in the future?

In today’s dynamic and evolving market, actuaries are presented with more complex challenges and thus greater opportunities to add value and expand their influence. While many actuaries work in the insurance industry, more are working outside of the traditional sectors in banking, investment management and technology as companies in those sectors seek greater control over risk.

The environment we operate in is constantly evolving to new socio, economic and political developments: changes in risk profiles, advances in technology, changes to climate. All of these impact the reinsurance industry and present many opportunities for actuaries

How often and in what way do you use social media?

I use social media for both professional and personal uses. The actuarial outpost is an actuarial discussion forum where actuaries at various stages of their career – students to most senior credentialled actuaries – can exchange ideas, ask questions regarding specific issues or exam problems and post job openings. I do believe social forums are a great vehicle to connect actuaries and foster a collaborative environment in the industry.

What have been the influences that shaped your career decisions to date?

I have had the chance to meet and work for great mentors throughout my career. They have given me valuable advice to improve myself and they have supported me to take on new roles and advance my career.

Could you tell us about your immediate and longer term goals?

My short-term goal is to become fully qualified.

My long-term goals is to continue learning, challenging myself and progressing in my career.

What do you say when asked, “What is an actuary”?

An actuary is a business professional that builds models using mathematics and statistics to analyse the financial consequences of risk.

How will you celebrate the day you qualify?

I will celebrate by taking a trip to Asia or South America.

July 2016 • THE ACTUARY www.theactuary.com

Sam L Mawoyo is a student from Zimbabwe, working at African Actuarial Consultants in Harare

Sam L Mawoyo

I am from Zimbabwe but I did my A-levels in Derby, in the UK, and part of my university studies in Southampton. I am an avid football fan. To be precise, I am repeatedly heartbroken by Arsenal.

I enjoy travelling and sightseeing. I listen to a diverse set of music genres-from live acoustic and classical music to full on dubstep. My family is in construction and I am reasonably skilled at a few handy jobs like plastering and bricklaying. I think I am the ‘best tradesman actuarial student’ out there, assuming such a thing exists.

I specialise in non-life-general insurance. It was by coincidence that I decided on this field as I was randomly placed in that department after joining my employer. Fortunately, I really enjoyed the nature of the work and decided to specialise in it.

I am a student member of the IFoA. I am also a member of the Actuarial Society of Zimbabwe.

Which actuarial fields are most dominant in Zimbabwe, and why?

Life insurance and employee benefits are THE ACTUARY • July 2016 www.theactuary.com

most dominant here. These two areas have traditionally been supported by regulation, and participants have experience working with actuaries.

Actuaries made their foray into general insurance about four years ago but we still face a challenge in having our value appreciated beyond regulatory requirements.

Changes in regulation are being mooted which should see greater actuarial involvement in other areas such as enterprise risk management.

Tell us a bit about the industry or market that you work in?

The general insurance market in Zimbabwe is growing marginally. This is by virtue of its correlation to the country’s overall economic activity which has been stagnant.

General insurance is very exciting. This is because of the diverse nature of activities that you deal with. This may be in conducting a business line performance analysis for a reinsurer or developing a new product.

General Insurance also develops a number of transferable skills which are useful in other areas.

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What kind of support do students get in your company, and elsewhere in the market?

Within my company, there is a good level of support. We have a number of students nearing qualification who mentor younger students especially around navigating the CTs. I am a product of a company programme that assisted students without first degrees to get on the path to fellowship.

I and a partner of mine that benefited from this pathway are now nearing qualification and the company has recruited more students for this route. This is testament to the financial and structural support provided by the company for students.

The rest of the market varies. Stable companies provide reasonable support but there are also some instances of no support at all. The manner in which our economy is performing is leading companies to tighten their purse strings overall.

Are you involved in any actuarial activities outside of your day job? If so, tell us about this activity and its benefits and challenges?

I was elected to be a council member of the Actuarial Society of Zimbabwe and am an active member of The 400 Club of the IFOA. I am also part of the General Insurance Working Party and the Events and Publications Committee of the Actuarial Society of Zimbabwe.

It is most interesting to be an active contributor to the direction in which our profession is moving.

The Actuarial Society of Zimbabwe is going through a phase of rebuilding awareness of the need for actuaries in the economy. This is following the brain drain that occurred in Zimbabwe during the economic meltdown between 2000 and 2009.

However, the vast majority of our members are students and so have to prioritise exams above all else. The shortage of qualified actuaries is resulting in less students being mentored by qualified actuaries as is the norm in bigger markets.

Could you tell us about a challenging project you have worked on?

Using the skills from general insurance-capital modelling, I was involved in an exercise that involved projecting the demand for grain

within the country over a given period. Our models were developed from first principles and we had to collect data and information from individuals who are not used to working with actuaries. Shaping our assumptions and presenting our results was an interesting process and we are glad that the users valued the actuarial skillset highly after the exercise.

What do you believe are the social and economic drivers for actuarial work in your region?

At the minute, pension issues are driving actuarial work. The conversion of values from the old Zimbabwe dollar to US dollars is being investigated as to whether it was done in a just manner. Actuaries are involved in this process.

What is the reputation of actuaries and the professional body in your country?

What kind of activities does the professional body engage in to promote the profession and its actuaries?

It is varied. Some professionals are not aware of the existence of actuaries, let alone what we do. For the vast majority of people, actuaries are highly educated people although there is minimal knowledge of the work we do.

However, companies and individuals who have worked with actuaries generally have a high opinion of us and our skills.

How do you see the role of an actuary evolving in the future – can you see actuaries working outside their traditional sectors?

I do expect actuaries to work outside of their traditional areas especially in developing countries. Risk exists outside of insurance and employee benefits. This may be risk that creates opportunities and risk that threatens existence. The actuarial skillset allows actuaries to work in all such environments.

How often and in what way do you use social media? How does it help your professional work as an actuary?

I am active on social media. I have networked with actuaries across the world especially on Twitter and Linkedin. Social media has also been incredibly helpful as I am not restricted by geography in finding mentors.

For challenges that I face and cannot solve,

At the minute, pension issues are driving actuarial work. The conversion of values from the old Zimbabwe dollar to US dollars is being investigated as to whether it was done in a just manner. Actuaries are involved in this process

I have an option to message someone on the other side of the world and get a quick response. This may be in preparing for an exam or learning about new software.

What have been the influences that shaped your career decisions to date?

I have been influenced by my personal ambitions to leave a legacy of note. I have also had to adapt to various unorthodox situations. Take for example, moving to work in Zimbabwe because finding an actuarial role in the UK without first having a degree was proving to be impossible.

Could you tell us about your immediate and longer term goals?

My immediate goals are to qualify and start working towards being a strategic business professional. In the long term, I will open a financial institution and grow it into a global giant.

What do you say when asked, “What is an actuary”?

A business professional that works with organisations to identify opportunities and manage threats to the organisation’s mission and vision.

How will you celebrate the day you qualify?

I have not put much thought into it but my girlfriend seems to be getting her voice ready for the most high-pitched ululation in history!

July 2016 • THE ACTUARY www.theactuary.com

Winnie Badiah is an actuarial consultant from Kenya working at BC Risk, Nairobi

Winnie Badiah

Born and raised in Nairobi, Kenya, I am an actuarial consultant at BC Risk Services specialising in microinsurance and the founder of GrassRoots Microinsurance, which seeks to provide appropriate inclusive insurance services digitally.

I’m a natural athlete (100m races) and despite my height, whenever I have some free time, I’m an avid basketball player.

I enjoy globetrotting and learning about different cultures as well.

Which actuarial field(s) do you specialise in?

Risk management and microinsurance.

Why did you decide to study or work in this specific field?

Having graduated with an MSc Actuarial Management from Heriot-Watt University (UK), and owing to my past experiences, I developed my passion for risk management with a focus on protection for the underserved market.

Not only are there very limited innovations in the insurance industry but also many challenges in the growth of microinsurance, in spite of the intense need.

THE ACTUARY • July 2016 www.theactuary.com

Which actuarial society are you a member of?

The Actuarial Society of Kenya (TASK) and also the Institute and Faculty of Actuaries.

Which actuarial fields are most dominant in your country, and why?

The life Insurance industry has been the most dominant over the years in Kenya, despite over 60% premium income from the non-life sector. There will, however, be a need for more actuaries in the non-life sector as the risk-based supervision measures come into force in June 2016.

Tell us a bit about the industry or market that you work in?

I serve in areas such as delivering risk assessment and management, strategic consulting and resource management, training and capacity building for various clients and product development for the mass market.

What kind of support do students get in your company, and elsewhere in the market?

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of industry talks and TASK Forums for discussions on developments in the actuarial fields.

Are you involved in any actuarial activities outside of your day job?

I recently joined the Microinsurance Working Party under TASK. Could you tell us about an interesting project you have worked on?

Working as a software developer I am currently testing the beta version of our microinsurance platform to provide insurance solutions through various digital channels.

What do you believe are the social and economic drivers for actuarial work in your region?

The industry is shifting to improved risk-based supervision (RBS) measures – higher capital requirements – to reflect best practice in the industry globally, to increase both consumer protection and regulatory oversight.

A number of African countries such as Nigeria, Tanzania, Uganda and Zambia are spearheading the growth of microinsurance through progress in the implementation of regulations to allow prepared players to operate as solely proficient microinsurers.

Since there’s great potential for the insurance market to grow as penetration is still low, we look forward to the implementation of the Microinsurance Regulations in Kenya as well, which will see further uptake of insurance.

Kenya is experiencing growth in the real estate, the building of the standard gauge railway line, and growing oil and gas sector and investors will seek to take advantage of these markets. Actuaries will have to gear up for this, since investors will need insurance.

I also foresee use of data analytics to offer more insights on modelling and claims management in future particularly in non-life fields, which are more prone to malpractice and fraud.

What is the reputation of actuaries and the professional body in your country? What kind of activities does the professional body engage in to promote the profession and its actuaries?

The actuarial profession is at its nascent

stages, not only in Kenya but within the majority of African countries. Many people have either not heard of actuaries, or don’t know or understand what exactly the work of an actuary entails. TASK is doing a great job hosting annual actuarial conventions to promote the profession in Kenya.

How do you see the role of an actuary evolving in the future – can you see actuaries working outside their traditional sectors?

We will certainly see more actuaries and actuarial trainees joining the non-traditional fields such as risk management and consulting for other industries.

I also anticipate that we will have more involvement in the microinsurance space, carrying out primary research and development in an attempt to understand this unique market using a bottom-upapproach, so as to innovate appropriate products for the financially underserved market.

How often and in what way do you use social media? How does it help your professional work?

I mainly use social media, particularly Twitter and LinkedIn to share news about goings-on in the global insurance industry. These platforms can further be used to increase awareness of the actuarial profession to our networks, considering very few understand who an actuary is, and what exactly our work involves.

What have been the influences that shaped your career decisions to date?

I was introduced to the actuarial profession back in high school during a career talk from our alumnae. I enjoyed maths and it has been the perfect choice to apply my acquired technical skills in pursuing an actuarial degree.

Could you tell us about your immediate and longer term goals?

In addition to working towards my CERA qualification, I am a budding entrepreneur.

I am the founder of GrassRoots Microinsurance, which I have formed to provide affordable and accessible digital insurance services, in order to make insurance cheaper, more transparent and cost effective for prospective microinsurers.

I see more actuaries, and actuarial trainees, joining the non-traditional fields such as risk management and consulting for other industries. I also anticipate that we will have more involvement in the microinsurance space

I’m keen to minimise the uninsured and underinsured market gap in Sub-Saharan Africa at the very least. I will also venture into impact investment as an angel investor in the longer term, for social impact not only through insurance but in other industries as well.

Have you ever thought of moving abroad?

If so, where would you move to? Would you seek a similar or different role?

I would love to go to Asia; China, India and The Philippines as they are the leading markets in microinsurance. The first-hand experience I would get in these countries would expose me to different models, which can be tailored for the African market.

I am also eager to expand my network and possibly form new partnerships to implement various microinsurance models in Africa.

What do you say when asked, “What is an actuary”?

A professional who goes through intense education and experience applying statistical methods to assess risk, mainly in insurance and financial industries.

How will you celebrate the day you qualify?

I will definitely be making a donation to my church when I qualify, then do something random that I’ll probably think about then.

July 2016 • THE ACTUARY www.theactuary.com

Edwin Puso Afitile is a student from Botswana working at Deloitte, Johannesburg, South Africa

Edwin Puso Afitile

I was born in a small village called Molepolole in Botswana but now live and work in Johannesburg, South Africa.

I previously worked in the capital and risk team of a bancassurer and have just recently joined Deloitte Actuarial Insurance Solutions.

I am a diehard fan of Township Rollers F.C. from the Premier League in Botswana.

In international football, I am a Real Madrid fan. I often feel uplifted by helping others whenever I can, and I consider altruism a primary human virtue.

Apart from that, I am Orthodox Christian; Old Apostolic Church.

I specialise in finance fellowship, and have worked in risk and capital management in life. I have just started working in life insurance consulting.

I decided to work in this field because when I was 15, a friend of mine said there were a lot of books to read and the training is mainly self-study. I got hooked.

I am a member of the IFoA and the Actuarial Society of South Africa (ASSA).

THE ACTUARY • July 2016 www.theactuary.com

Which actuarial fields are most dominant in Botswana, and why?

Life insurance, as most of the biggest employers are life insurers.

Tell us a bit about the market you work and study in?

Consulting is great, it’s like engineering, you have the opportunity to get your hands dirty.

I like working with a problem from beginning to end. It is also very client-focused – you have to keep in mind the other person and do the best for them. It’s also partly academic; you are forced to develop insight – no shortcuts.

The nature of the work is very unpredictable and varied since clients can seek help with anything, you never stop learning.

In life insurance, there is also more emphasis on complying with the SAM regime (Solvency II equivalent). On the other hand, the increasing clarity of reporting within the SAM regime has dramatically improved our communication. A senior management person can understand the real financial risks an organisation is taking and the effects of their aggregation. This is the triumph of risk management.

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What kind of support do students get in your company, and elsewhere in the market?

A lot of support, from motivation to exam fees and study leave. The study leave at Deloitte is more generous compared to the market average, I would say.

Are you involved in any actuarial activities outside of your day job? If so, tell us about this activity and its benefits or challenges?

I am a member of the Actuarial Society of South Africa’s committee on Private Equity, Venture Capital, Infrastructure and Government Projects (PE, VC, I&GP).

This is a very interesting, relatively new committee; you get to apply your skills outside the norm. The other volunteering work I do is help to organise Botswana’s First Convention on Finance and Risk Management. The main benefit is the marketing of the profession to people who need our skills the most.

Could you tell us about a challenging project you have worked on?

I took the lead in an exercise at my previous employer on ‘Assessing the effectiveness of a hedging strategy’. Following the review, we considered applying basic replication strategies to see how we can eliminate shortfall risk in matching guaranteed liabilities, subject to the CRO’s requirement to ensure our solution is ‘effective’.

There is still room for growth in asset liability modelling, and the use of structured finance products is an area we should all consider.

I am currently writing a research paper for publication in this area and will hopefully present at the ASSA convention in November.

What do you believe are the social and economic drivers for actuarial work in your region?

Post-recession regulation; companies currently have to meet the regulatory requirements of capitalising their book in the SAM & Basel regimes without choking innovation.

On the other hand, the National Health Insurance white paper has recently been published and is currently under scrutiny from Healthcare practitioners. The NHI is a system based on a risk-pooling model to ensure Universal Health Coverage for all

South Africans. Another topical issue is the retirement reform proposals that have been put on hold for two years. These reforms relate to the requirement to purchase an annuity at retirement for provident fund members.

What is the reputation of actuaries and the professional body in Botswana? What kind of activities does the professional body engage in to promote the profession?

The reputation of actuaries in South Africa is very good, most people who know about it know that the exams are very difficult.

ASSA does a lot to promote the image and role of actuaries for example facilitating members’ volunteering for awareness programmes at schools as well as building relationships with non-actuaries and their associations such as CFA South Africa. A reciprocal arrangement exists whereby members of ASSA are invited to CFA South Africa presentations, and members of CFA South Africa are invited to relevant sessional meetings of the Society.

How do you see the role of an actuary evolving in the future – can you see actuaries working outside their traditional sectors?

In the next few years the market for actuaries will become crowded and they will be forced to look outside their usual areas of practice to those such as agriculture, manufacturing and mining.

I see consulting actuaries doing very well here since they are used to variety and uncertainty.

How often and in what way do you use social media? How can it help your professional work as an actuary?

I have a Facebook account and a Twitter handle and I use them for personal purposes.

When used well, social media can help in the marketing of products.

What have been the influences that shaped your career decisions to date?

I first heard about actuarial science from a friend called Thabiso Motshedi, he was very keen on life-long learning. I had to convince the government to give me a bursary for my studies. I also had to convince my mother that I did not want to become a medical

In the next few years the market for actuaries will become crowded and they will be forced to look outside their usual areas of practice to those such as agriculture, manufacturing and mining.

I see consulting actuaries doing very well here as they are used to variety and uncertainty

doctor. I remember running to a high-priest to intervene in our disagreement.

My move to consulting was partly inspired by my supervisor for the research work I am doing in quantitative finance. The specific move to Deloitte was inspired by the Deloitte reviewers who I had worked with before.

Could you tell us about your immediate and longer term goals?

My long term goal is to reach out and give back to Africa through the skills I have learnt through actuarial science. However, I would like to see more actuaries applying their skills to solve uncommon problems like helping the governments establish a national risk management function. This can only happen if we market these skills and compete outside the profession.

We need to create a platform to integrate with other people, build relationships and maintain them.

What do you say when asked, “What is an actuary”?

I often say that an actuary is a professional trained in a variety of numerate disciplines who uses their skills to make financial and risk management decisions.

How will you celebrate the day you qualify?

I will boil my notes from the CA3 exam (the only exam left to attain FIA/FFA,FASSA and CERA) and drink the water!

July 2016 • THE ACTUARY www.theactuary.com

Natasha Saikia is a student from India, working at XL Catlin in Gurgaon

Natasha Saikia

I hail from the beautiful state of Assam in India. I successfully graduated in statistics from Lady Shri Ram College, University of Delhi. Following my graduation, I got an opportunity to work with XL Catlin Gurgaon specialising in the non-life sector where I have been for almost three years.

I am interested in dance and music, particularly Indian classical music and the classical dance form of Bharatnatyam. I also like western Jazz and Zumba. I plan to learn other dance forms too such as salsa and belly-dancing. I believe that dance is the perfect way to relax the body and mind.

I also love to travel, explore new places and try different cuisines from time to time.

I specialise in the non-life domain, mainly on the reserve risk side. I leaned towards mathematics and that’s why I decided to study statistics. During that time I applied for the actuarial exams. Modelling, probability distributions and simulations fascinated me and fostered my interest in pursuing actuarial science as a career.

I am a member of both the IFoA and Institute of Actuaries of India (IAI).

Which actuarial fields are most dominant in India, and why?

Life insurance is the most developed market and has immense growth potential. The country’s demographics command the attention of market entrants: a young population, and a large and growing middle class with increased purchasing power and a disposition to save. Savings products hence dominate the market. Pensions is the second most dominant field due to the growing awareness among the young and middle-aged populations about the importance of building a retirement fund.

Tell us a bit about the industry or market that you work and study in?

I work in the non-life industry in the reserve risk team within XL Catlin. Reserve risk is a fairly new concept within the insurance market and is one of the highest contributors to the solvency capital of a company. It is a highly sensitive area and involves a lot of research and development in relation to different techniques to best estimate the volatility of a particular line of business.

What kind of support do students get in your

THE ACTUARY • July 2016 www.theactuary.com

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company, and elsewhere in the market?

Most of the actuarial companies have a comprehensive actuarial study support programme where the students get weekly study leave before their exams. The companies reimburse examination fees, study material costs and also the actuarial membership renewal fee. Apart from this, companies give salary increments to students on passing exams as a means of appreciation and motivation.

Could you tell us about an interesting project you have worked on?

I have been involved in reserve risk infrastructure projects, the most interesting being the development of methodology for reserve risk estimation on a net of reinsurance basis for lines with excess of loss business which is still on-going.

What do you believe are the social and economic drivers for actuarial work in your region?

Actuarial assumptions are greatly dependant on demographic trends, the economic scenario and the prevailing social environment. The main driver for healthcare insurance is the lack of a government-aided universal healthcare system.

Due to the population’s low income levels and less awareness about various insurance products available, marketing of products has proved to be challenging. Penetration has been difficult especially in rural areas. The climatic condition is also quite varied across the country which influences the health and lifestyle of individuals.

That along with medical conditions such as morbidity trends has led to an increase in healthcare products over the years, though they have a long way to go.

What is the reputation of actuaries and the professional body in India?

In general people are not aware of actuarial science as a career. There is a mad race for actuarial science amongst college students pursuing statistics, mathematics, economics and engineering, however, students are not aware of the kind of actuarial work they would be doing in future and the limited supply of companies hiring actuarial staff.

The IAI is doing a good job in organising the Global Conference of Actuaries (GCA) every year, which attracts some of the most influential actuarial minds from all parts of the world. It involves lectures and discussions related to

the fast-growing fields such as property and casualty, life and health, pensions and risk.

How do you see the role of an actuary evolving in the future – can you see actuaries working outside their traditional sectors?

The number of actuaries in non-traditional sectors has increased significantly in recent years. As there is increasing realisation of the importance of an actuary, many Indian insurance companies are setting up small actuarial teams, hence widening the scope for actuarial students.

In spite of actuaries being highly regarded in the life and pension industry in India, their importance in the non-life industry is also gradually increasing. Currently, actuaries are mainly responsible for pricing products under different lines of businesses and reserving.

However, there are actuaries in other important areas like capital modelling and reserve risk in the future.

How often do you use social media?

How does it help your professional work as an actuary?

Social media sites such as LinkedIn can be influential in terms of job opportunities, creating professional contacts and generating awareness about the various roles that actuaries are involved in. I like to use LinkedIn to gain contacts within the actuarial world, learn about the various companies involved in different fields, and new innovations within the industry.

What have been the influences that shaped your career decisions to date?

My love for mathematics and statistics made me choose actuarial science as a career path. Ever since I entered this field, I feel increasingly motivated because of the work I do, the intellect of my colleagues, interaction with actuaries and of course the challenging actuarial exams. I feel lucky to be working in my field of interest and I believe I will reach great heights within the actuarial field.

Could you tell us about your immediate and longer term goals?

My immediate goal would be to achieve expertise in reserve risk and enhance my business knowledge and technical skills. At the same time, I would like to work on challenging projects in order to broaden my analytical skills.

In spite of actuaries being highly regarded in the life and pension industry in India, their importance in the non-life industry is also gradually increasing. There is windening scope for the involvement of actuaries in other important areas like capital modelling and reserve risk in the future

My longer term goal would be to become a fully qualified non-life actuary and to be an expert on various actuarial fields such as pricing, capital modelling and reserving. I would also like to gain a respectable position within the actuarial society and be able to make important decisions independently.

Have you ever thought of moving abroad?

Yes, definitely, the actuarial market abroad is much more developed and hence it has immense work opportunities to provide. I want to explore opportunities outside India. However, there is a big challenge in obtaining work visas.

Many companies abroad apart from few consultancies, especially in Europe and in the US, do not sponsor work permits, so the scope becomes limited. This is a challenge many Indians face. The other challenge might be that in Europe and in the US, the actuarial market is so saturated that there are not many positions open to outsiders.

What do you say when asked, “What is an actuary”?

An actuary is a professional who quantifies the level of risk that a company or individual might face in future, and then comes up with an appropriate solution to mitigate those risks, and thus helps clients or individuals to make a correct decision.

How will you celebrate the day you qualify?

I would like to throw a big party for my success and then plan for a long vacation.

July 2016 • THE ACTUARY www.theactuary.com

Chinnaraja Chendur Pandian is an actuary at Nomura Services, Mumbai, India

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Chinnaraja Chendur Pandian I recently qualified as the first Fellow Actuary from Dharavi, Mumbai, joining an elite class of 300 actuaries in India. Dharavi featured in the Oscar-winning movie Slumdog Millionaire. It’s widely portrayed as ‘the largest slum in Asia’ but in reality it’s a vibrant, cultural place.

I am working with a quant risk team in a leading investment bank in Mumbai.

I specialise in finance and investment, and working in the quantitative risk management field. I began my career in the financial markets with the National Stock Exchange of India. I found the field lively, with room to work in a wide range of exotic products, providing exposure to different valuation models and risk management methodologies. This was dynamic in terms of products compared to more traditional insurance products, and I decided to continue with it even after qualifying.

I am an active member of the Institute of Actuaries of India. Previously I was also a member of the IFoA in London.

I spend my free time with my family and daughter, watching Tamil movies.

Which actuarial fields are most dominant in India?

Life insurance is the most dominant in India. The liberalisation of the sector for private companies in 2000, and the formation of the Insurance Regulatory and Development Authority of India laid the mandate of ‘appointed actuary’ for both life and non-life sectors.

This milestone led to a surge in demand for actuaries in this field. However, large parts of non-life products and premium rates have been governed by the Tariff Advisory Committee and as a result the role of actuaries in non-life was limited until 2007. The de-tariffication of non-life products in 2009 also paved the way for an increased role for actuaries.

Are you involved in any actuarial activities outside of your day job?

I contribute by writing articles about the application of statistical tools in financial markets, some published by The Actuary in London and India. I also present lectures to aspiring students and attend seminars.

Could you tell us about an interesting project you have worked on?

During my stint with the National Stock Exchange of India, I developed and launched

Asia’s first volatility Index, ‘India VIX’ using Cubic Spline. Another challenging project was conceptualising and developing India’s first successful cross margining system (CROMA), reducing the margin by 75% for hedged portfolio. These projects had largely benefited the Indian capital market by way of reducing the trading cost and are a benchmark for tracking market volatility.

What are the social and economic drivers for actuarial work in your region?

The demand for financial products is driven by population growth, and the need for health and retirement products is only going to increase.

Another key driver for actuarial work is the evolution of regulation.

What is the reputation of actuaries and the professional body in India?

Actuaries have a good reputation within the insurance sector in India. Demand is strong given the small pool of qualified actuaries (290 as of March, 2015).

But visibility in other fields is less as many professions are unaware of the rigorousness of the course and the technical skills of actuaries. Even with the overlap of regulatory frameworks it has not created much opportunity for actuaries in banking and risk management. The professional body conducts seminars, training sessions and publishes a magazine to promote actuaries and it’s now good to see steps being taken to promote the role of the actuary in other fields. However, India, which is in a transition state, is quite far behind in recognising actuarial skills in non-traditional fields. Attracting foreign direct investment may offer actuaries opportunities in other sectors but first companies need to realise that actuaries are experts in every business situation where risks are involved, not just life insurance.

How often and in what way do you use social media as an actuary?

I frequently use LinkedIn for networking. It helps with building networks, getting updates on the regulatory changes, sharing of knowledge and ease of publishing research articles.

What were the influences that shaped your career decisions to date?

I discovered my interest in statistics and mathematics during my engineering and management studies where I outperformed

Actuaries have a good reputation within the insurance sector in India.

Demand is strong given the small pool of qualified actuaries. But visibility in other fields is less; many professions are unaware of the technical skills of actuaries

in statistics papers. I am highly thankful to one of my friends, Shreya Bapat who gauged my interest in statistics during my work and introduced me to the actuarial profession.

Tell us your immediate and long-term goals.

Following my fellowship I took ST9 (Enterprise Risk Management) and am about to qualify as a Chartered Enterprise Risk Actuary (CERA) which is my short-term goal. In the long term I want to gain acumen in the field of quantitative risk management. On the social front I would love to contribute to my society, Dharavi and would aim to portray it in a positive light. While pursuing my actuarial studies, I also qualified as a financial risk manager and a professional risk manager by leveraging my actuarial skills. In this technology-driven and big-data age, learning relevant programming language gives one an upper hand in one’s profession. I am sure the actuarial profession will soon consider including a computation finance module as well.

What are the challenges, new opportunities and benefits of being qualified?

Balancing work and family life along with pursuing being an actuary was the biggest challenge. The course module was quite technical which sharpened my skill sets.

What do you say when asked, “What is an actuary”?

An actuary is an expert who professionally and ethically does the valuation and mitigation of future uncertainty using data analysis, statistics and mathematical models.

July 2016 • THE ACTUARY www.theactuary.com

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Khang Phung is an actuary at PVI Sun Life, Ho Chi Minh City, Vietnam

Khang Phung

I grew up in Ho Chi Minh City, the energetic commercial hub of modern Vietnam but spent a large part of my career working overseas, including five years in the UK and two years in Singapore.

I love watching football and have been a keen fan of Arsenal for more than 15 years.

I also like tennis and try to play on a regular basis. I enjoy playing the piano every now and then; however, whenever I try to play a romantic song, my four-year-old boy always asks me to play ‘the wheels on the bus’.

I specialise in life insurance. I work both in valuation, pricing and product development. When I started my career in Vietnam, only the Vietnamese life insurers offered actuarial jobs so it was natural that I took on the life insurance path.

I am a member of the Institute and Faculty of Actuaries.

THE ACTUARY • July 2016 www.theactuary.com

Which actuarial fields are most dominant in Vietnam and why?

Life insurance is most dominant. Vietnamese non-life companies do not seem to have much use for actuarial resources. Voluntary pensions are relatively new and follow the defined contribution framework so do not require much actuarial input.

Risk management is a growing area but only large and multinational insurers have a separate risk function, so the actuarial opportunities are limited.

Tell us a bit about the industry or market that you work in?

With the young demographic, low insurance penetration and growing affluence, Vietnam is undoubtedly a high potential market over the longer term.

The Vietnamese life insurance market has enjoyed double-digit, year-on-year growth over the past 10 years. The overall premium income of the market was USD 1.5bn in 2015, an increase of 35% year on year. In addition, premium income is forecast to continue to grow at 15-20% per annum in the next few years.

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which is increasing, and the market is arguably becoming overcrowded given its size.

The life insurance market is dominated by foreign insurers with only Bao Viet Life and Phu Hung Life positioning themselves as ‘local’, although both have foreign shareholders.

Are you involved in any actuarial activities outside of your day job – such as volunteering for the profession?

I am a keen volunteer and have been involved in many activities to support fellow students and to promote the IFoA in Vietnam.

I am a mentor for student members, and also work as a tutor for ST2 and SA2 subjects.

I also support the Student Career Fair in Singapore and actively promote the IFoA with local universities.

I’m in charge of organising the networking event for IFoA members in Vietnam and I’m also a career ambassador.

What do you believe are the social and economic drivers for actuarial work in your region?

Healthcare and pensions are definitely the social economic drivers for actuarial work in Vietnam and in Southeast Asia.

What is the reputation of actuaries and the professional body in Vietnam?

Actuaries are very well respected in Vietnam.

In fact, a few CEOs of the top life insurers are actuaries. There is unfortunately no professional actuarial body in Vietnam.

A few senior actuaries had a career talk at the one of the top universities to promote the actuarial profession; however, this is normally done on a personal level.

How do you see the role of an actuary evolving in the future – can you see actuaries working outside their traditional sectors?

Yes, definitely. In fact, I’m interested in the application of predictive modelling in marketing and e-commerce.

How often and in what way do you use social media? How does it help your professional work as an actuary?

I use social media mainly for personal

reasons. But it also helps with work, as I come across many interesting articles on the application of actuarial skills outside traditional areas.

What were the influences that shaped your career decisions to date?

I like exploring, so have tried many interesting actuarial roles throughout my career. Actually, one of my first jobs was to write up a product brochure in which I had to think of creative ways to present complex benefits so that a layman could understand it easily.

I didn’t like it in the beginning but later on I realised that was a very good way to improve communication skills.

Could you tell us about your immediate and longer term goals?

My immediate goal is to develop and launch many attractive and innovative products to serve the needs of Vietnamese customers. The longer term goals are to support the Vietnamese regulators in developing a comprehensive health care and pension system.

Have you thought of pursuing other academic qualifications? Do you think that actuaries should look at others sources of education to advance their career?

Yes. I am thinking of enrolling in a MBA or marketing course but have not yet decided. I definitely believe actuaries should look at others sources of education to advance their career in this fast changing world.

As an actuary have you experienced any challenges, new opportunities and benefits of being qualified?

I very much enjoy being a qualified actuary.

In fact, the benefits of being qualified are enormous in countries like Vietnam where the number of qualified actuaries is very low.

I’ve been involved in a wide range of activities that a qualified actuary would not usually get to work on in a developed country.

What do you say when asked, “What is an actuary”?

People don’t generally ask me that question

I like exploring so I have tried many interesting actuarial roles throughout my career.

One of my first jobs was to write up a product brochure in which I had to think of creative ways to present complex benefits so that a layman could undertand it easily.

That was very good way to improve communication skills

as an actuary is not a popular job in Vietnam. Even my family don’t know what I do!

What was the motivation behind the decision to work overseas in the UK and how long did you stay?

The main motivation was to get overseas exposure. I stayed in the UK for five years and absolutely love the country. Strangely, I still miss the UK weather every now and then.

What do you think are the main professional differences between Vietnam and the UK? There are many differences working in developed markets like the UK and emerging markets like Vietnam: business, regulatory environment and career opportunities for actuaries are some of them. Qualified actuaries in Vietnam are generally in a better position to get senior roles.

What kind of support did you get during your research in moving abroad – from recruitment agencies and potential employers?

I was lucky to get the support from my employers. They provided very useful information and I did actually come to the UK for the interview to see how things were before I made my decision.

July 2016 • THE ACTUARY www.theactuary.com

Graham Watson is an actuary at HSBC, Hong Kong, and originally from the UK

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Graham Watson Outside the actuarial world I enjoy travelling and hiking. Being based in a different continent opens up a huge range of new and interesting places to visit; destinations that I may have not chosen when they previously involved a long-haul flight. Hiking in Hong Kong was probably one of the biggest surprises – being a city-state it’s not probably something you’d initially expect, but after a short journey you can be out of the city with nature in one of many country parks and hiking trails.

You specialise in life, why did you decide to work in this particular field?

This was the field that I joined following my graduation from university. However, it is something that I enjoy and so I’ve stuck with it.

Which actuarial society are you a member of?

The IFoA and the Actuarial Society of Hong Kong.

Which actuarial fields are most dominant in Hong Kong and why?

Life insurance is most common.

A large proportion of the multinational companies operating in Asia have their Asia-Pacific headquarters here, as well as their life offices manufacturing and distributing life insurance products.

Tell us a bit about the industry or market that you work in?

There are many similarities between the insurance market here to that in the UK, as a result of British rule here until 1997. The market is probably more savings-orientated as compared to protection, with products more geared to meeting needs that the state would play a much greater role in in the UK, through the provision of education, healthcare and retirement savings.

Are you involved in any actuarial activities outside of your day job?

Yes, I’m a career ambassador here in Hong Kong and I’ve spoken at local universities to actuarial students. This has been a great opportunity to engage with the next generation of actuaries and see their enthusiasm for the profession. I was also part of the organising committee for the IFoA Asia conference in Kuala Lumpur this year.

What do you believe are the social and economic drivers for actuarial work in your region?

The biggest change is likely to the implementation of a risk-based regulatory reporting system in Hong

Kong over the coming years. Hong Kong currently has a prudent ‘Solvency I’ approach, not too dissimilar to the regime that used to exist in the UK. A regulatory change that will occur more quickly will be the requirement to provide more extensive and regular illustrations to policyholders so that they better understand the contract they have purchased and their ongoing performance.

What is the reputation of actuaries and the professional body in Hong Kong?

They seem to be held in relatively high regard in Hong Kong. The professional body supports the regulator in the development of guidance notes to support the interpretation of the law.

How do you see the role of an actuary evolving in the future?

Actuaries will continue in their traditional fields, but as our numbers increase there will be an expanding number of actuaries in other areas.

The skills we have open up a huge range of sectors to be considered.

How often and in what way do you use social media?

I’d probably describe myself as an occasional user of social media, which I use to keep in touch with people that I probably wouldn’t otherwise stay in touch with.

What were the influences that shaped your career decisions to date?

Having a great mentor is probably the biggest factor.

Could you tell us about your immediate and longer term goals?

In the short term I’m looking to continue developing my career in Hong Kong. In the longer term I’m not sure if I’ll get wanderlust again and want to try working in another location.

Have you thought of pursuing other academic or CPD qualifications?

I’ve loosely thought about taking ST9 to obtain the CERA qualification, but then this does seem like a lot of hard work!

As an actuary have you experienced any challenges or benefits of being qualified?

The biggest opportunity that came after I qualified was the opportunity to work here in Hong Kong.

Having always enjoyed travelling, the opportunity to work overseas was always something that interested me. At times I thought this may be a pipedream, but after some research I found that it was possible.

Actuaries will continue in their traditional fields, but as our numbers increase there will be an expanding number of actuaries in other areas. The skills we have open up a huge range of sectors to be considered

I’ve set no limits on the length of my stay overseas.

I’ll stay for as long as I’m enjoying it and there aren’t other opportunities elsewhere that I want to explore.

When I first moved I thought it would maybe be for 5-10 years, but we’ll just have to see.

What are the main professional differences between the UK and Hong Kong?

The main difference is the willingness to challenge and debate different points. The culture is a little different and so saying too openly that you disagree with a point is not always done.

How did you find this opportunity?

I used a recruitment agency. The overall process, from receiving the job particulars to being given an offer, was around three months and I was in Hong Kong in another two to three months after this.

What kind of support did you get during your research in moving abroad – from recruitment agencies and potential employers?

I got lots of support from my employer and recruiter in the process, and it was also quite exciting to go and do my own research as I was about to embark on this new adventure. The main support I received was with regards to visa application and the physical process of moving overseas.

What do you say when asked, “What is an actuary”?

The response I provide depends on who I’m talking to. It could range from “like an accountant” to “a person who undertakes complex calculations to assess the value of payments that are uncertain in their timing and size”.

July 2016 • THE ACTUARY www.theactuary.com

Ian Brealey is an actuary at Allianz Australia, in Sydney and is originally from the UK

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Ian Brealey I moved to Australia in 2009 with my wife, who is also an actuary and from the UK. We both wanted to try living abroad and Australia was an obvious choice with its beautiful weather and no language barrier – well, only a little language barrier. When we first landed, I did wonder what on earth we were doing but on our second day, we took a walk to Manly beach and that was enough to convince us that we were in the right place. We now live here permanently with our two young daughters.

I have specialised in non-life ever since I started as a graduate with KPMG in 2006.

When I applied for my first actuarial job as a graduate, the intake was split into life and non-life teams. I actually chose life as my preference but was put into non-life. I enjoy the work so I am pleased it happened that way.

Which actuarial society are you a member of?

The Institute of Actuaries of Australia.

Which actuarial fields are most dominant in Australia?

Life, non-life and pensions, like the UK. Tell us a bit about the industry or market that you work in?

The work is very similar to the UK but there are fewer insurance companies. This means the actuarial industry is much smaller and most actuaries know each other.

Are you involved in any actuarial activities outside of your day job?

I am Allianz’s representative for a university actuarial student placement programme. Each student completes three job placements during their degree at different participating companies.

The students are usually the top performers from their university and it always impresses me how much knowledge and determination they possess.

Could you tell us about an interesting project you have worked on?

I recently undertook a project at Allianz to identify which of our online insurance quotes were real people and which were robots from companies attempting to identify our pricing. It was a really challenging and required innovative thinking.

What do you believe are the social or economic drivers for actuarial work in your region?

Customer information is increasingly being utilised

by Australian companies to improve their products and services. I have seen a number of examples of actuarial teams being created to this end.

What is the reputation of actuaries and the professional body in Australia?

The reputation of actuaries is very strong. When I moved here, I liked the fact insurance companies’ reserves are required to be best estimates signed off by a chief actuary, with no allowance for management or equalisation reserves. I think this puts more responsibility on the actuaries.

How do you see the role of an actuary evolving in the future?

I think we are already at that point, I see a number of actuaries working in non-traditional fields and think it will only increase. Some of the consultancies have actuarial teams dedicated to data analytics for companies outside the traditional areas.

How often and in what way do you use social media?

I am a relative technophobe compared to most people of my generation when it comes to posting on social media, however it is very helpful for keeping in touch with my friends and family overseas. From a professional context, I believe social media has huge potential to be used more in the future by insurance companies looking to utilise external data to differentiate risk for pricing.

What were the influences that shaped your career decisions to date?

The biggest influences have been the people who dedicated their time to mentoring me.

At work, I have been extremely lucky to have had some excellent managers.

My wife has also spent lots of time helping me make key career decisions and it has been really helpful to have her there to discuss ideas.

Could you tell us about your immediate and longer term goals?

I like to use data analytics and then apply real-world thinking over the top. This applies directly to my current role and I am always looking for ways to innovate in order to improve pricing. I don’t have any set plans for the future but see myself applying the same type of techniques, whether it’s in the insurance industry or something different.

Have you thought of pursuing other academic or CPD qualifications?

I feel the best learning I can do now is on the job and seeking out material specific to my areas of interest.

As an actuary have you experienced any challenges or benefits of being qualified?

As a student actuary, I certainly looked forward to

The reputation of actuaries is very strong in Australia.

When I moved here, I liked the fact that insurance companies’ reserves are required to be best estimates signed off by a chief actuary, with no allowance for management or equalisation reserves

getting my free time back, which hasn’t disappointed!

The qualification is important in securing a number of actuarial roles, however I believe the most important thing is your experience and skillset.

What was the motivation behind the decision to move and how long did you envisage staying?

I had always wanted to try living in Australia since I was a child. I liked the idea of a warmer climate and the more laid back way of life. Thankfully my wife had similar thoughts. We decided to treat the move as permanent, so we really threw ourselves into it.

What are the main professional differences between the UK and Australia?

I think there are relatively few differences. The first challenge was to understand the different regulations in Australia but I found the material from the Australian regulator APRA easy to understand.

What kind of support did you get in moving?

I contacted recruitment agencies both in Australia and the UK before I left, to find out about opportunities. Potential employers were keener to meet once I was in Australia in person. I entered on a backpacker visa, and contacted recruiters again to seek a job with visa sponsorship. One of the recruiters was kind and told me about an opportunity that wasn’t being advertised through any recruitment agency. This was the job I ended up in.

What do you say when asked, “What is an actuary”?

I use the example of my job: When you go online to get a car insurance quote and type in all your details, it is my team who come up with the price.

July 2016 • THE ACTUARY www.theactuary.com

Sharad Bajla is an actuary at Asia Capital Re in Singapore, and is originally from India

Sharad Bajla

I have lived most of my life in India. After spending four years with EMB/Towers Watson, I moved to Singapore with Asia Capital Re and have been here for about two years now. This is the first time I have lived away from home, and so I try to soak up every bit of the diversified culture in the region. Singapore is a brilliant place for vacations and I try to visit as many places as possible. I also love music and need lots of instruments buzzing in my ears at all times.

I specialise in non-life. More recently, I have been working in non-life reinsurance. It was a matter of chance that I decided to work in this field. As a fresh graduate, I was interested in actuarial fields but fairly indifferent between life and non-life. I was given a good opportunity at the start of my career in nonlife and haven’t looked at any other field since.

I am a Fellow of the Singapore Actuarial Society and partially regulated under the IFoA. Which actuarial fields are most dominant in Singapore and why?

Most actuaries here are involved in traditional roles of pricing, reserving and valuation.

Companies are however beginning to take an interest in more modern functions like enterprise risk management, capital modelling and strategic planning.

THE ACTUARY • July 2016 www.theactuary.com

Tell us a bit about the industry or market that you work in?

Singapore has established itself as the leading insurance hub in the region, catering to the whole of Southeast Asia and many markets in the wider Asia-Pacific region. The small city-state stands to benefit from the double-digit annual growth expected within the Asian insurance industry in coming years.

New rules from the regulator regarding risk-based capital are around the corner, with impact studies and consultations being carried out. It may take a few years, but the eventual implementation will significantly increase the demand for actuaries.

Are you involved in any actuarial activities outside of your day job? If so, tell us about the benefits and challenges?

I am involved in multiple volunteer roles with the IFoA – as an assistant examiner, exam counsellor and mentor. The roles help me stay in touch with the examination process. Through the counselling and mentoring roles, I get a chance to directly guide students towards the right approach to passing exams.

The most obvious challenge is that you cut down on your personal time. Sometimes, especially when the day job is already pressured, it is difficult to accept volunteer assignments.

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Could you tell us about a challenging or interesting project you have worked on?

I find my latest assignment interesting as well as challenging. I need to develop an in-house capital model. It is rare for such projects to be attempted in this region since data availability is quite limited. The best part is that as there is no existing model to work on, I have to be fairly creative in my approach.

What do you believe are the social and economic drivers for actuarial work in your region?

Actuarial work is strongly driven by regulatory requirements around valuation, audit and more recently, stress testing. Some markets are moving away from tariffs, which increases the demand for pricing actuaries.

Additionally, the risk of catastrophes in the region along with a soft market for reinsurers is pushing companies into careful analysis of their portfolios and accumulation risk.

What is the reputation of actuaries and the professional body in Singapore?

I believe actuaries are recognised in Singapore for the technical knowledge they bring to the industry. Most qualified members here are also fellow members of one of the globally recognised bodies like the IFoA, the Society of Actuaries or the Casualty Actuarial Society, since no exams are conducted by the regional society.

How do you see the role of an actuary evolving in the future – can you see actuaries working outside their traditional sectors?

We all agree that the role of actuaries is already evolving.

Many are getting involved in reserve variability, stress testing, enterprise risk management, capital requirement and allocation. These roles are fairly recent, especially in less mature insurance markets like Singapore.

In the future, I see actuaries playing a more strategic role in their organisation and having a bigger say in higher management. From what I have seen so far, actuaries in Singapore are still mostly involved in the traditional areas such as insurance firms.

How often and in what way do you use social media? How does it help your professional work as an actuary?

I probably use social media less than most people of my generation and most of this is for

personal use. LinkedIn is useful for building a network within the actuarial field. Sometimes, I stumble across interesting articles relating to the insurance market or actuarial work, but the impact is limited.

What were the influences that shaped your career decisions to date?

Like most readers, I always harboured a strong inclination for maths and statistics, which would explain why I joined this field. I love problem solving and enjoy projects that require me to devise customised solutions to each problem.

The Solvency II wave pushed me into building capital models, which I thoroughly enjoy.

Could you tell us about your immediate and longer term goals?

My short and intermediate-term goals are to learn from seniors and from a variety of experiences. Actuarial roles are fairly technical and specialised and the knowledge from actuarial exams is nowhere enough to succeed. I plan to use the initial phase of my career to grasp as much as possible.

Have you thought of pursuing other academic or CPD qualifications, or joining other professional bodies?

I heaved a sigh of relief when I qualified and decided that I am not going to do any more exams for the rest of my life. However, I have sometimes considered management programmes.

Currently, actuarial teams are small and the management expertise required is limited. However, actuaries have the ability to be heavily involved at the C-suite level in their company and management skills can be a strong asset.

Actuaries are recognised in Singapre for the technical knowledge they bring to the industry. Most qualified members here are also Fellow members of one of the globally recognied bodies like the IFoA, the Society of Actuaries or the Casualty Actuarial Society

London; but when I was offered an interesting role in Singapore, I accepted. Initially, I believed that this would only be a stepping stone in my career.

However, the longer I stay here, I feel more at home. Singapore is a wonderful place with such a wide mix of cultures.

What are the main professional differences between India and Singapore?

I think actuarial work is similar in most countries even though we have to adapt our methods to different markets.

As an actuary have you experienced any challenges, new opportunities and benefits of being qualified?

In the current environment, many countries are heavily discouraging hiring foreign workers.

A qualification marks the person as having a unique skill and places them in a limited pool of talent. As a result, it becomes a lot easier to be invited for opportunities in a different country.

What kind of support did you get during your research in moving abroad?

The recruitment agencies helped me understand the job market, salary levels and company reputation. My employer provided me with a clear picture of the working environment and the job specs. They also sponsored flight tickets, relocation expenses and put me up at a hotel for a month before I could find my own place. On the whole, the transition was unexpectedly easy.

What was the motivation behind the decision and how long do you envisage staying abroad?

I always wanted to work in a mature insurance market where advanced technical skills are an advantage. My first inclination was towards

What do you say when asked, “What is an actuary”?

An actuary is a super-genius mathematician (cue evil smile) who quantifies future financial risks. They are traditionally involved in the insurance industry.

July 2016 • THE ACTUARY www.theactuary.com