What you need to know
Actuaries use mathematics, statistics, and financial theory to assess the risk of potential events. They help businesses and clients develop policies that minimize the cost of that risk.
Most actuaries work at insurance companies, where they help design policies and determine the premiums that should be charged for each policy. Actuaries typically work on teams that often include managers and professionals in other fields, such as accounting, underwriting, and finance.
Some of the things an actuary might do:
- Decide what data are needed to answer specific questions or problems
- Apply mathematical theories and techniques to solve practical problems in business, engineering, the sciences, and other fields
- Design surveys, experiments, or opinion polls to collect data
- Develop statistical models to analyze data
- Interpret data and report conclusions drawn from their analyses
- Use data analysis to support and improve business decisions
- Analytical skills: Actuaries use analytical skills to identify patterns and trends in complex sets of data to determine the factors that have an effect on certain types of events.
- Communication skills: Actuaries must be able to explain complex technical matters to those without an actuarial background. They must also communicate clearly through the reports and memos that describe their work and recommendations.
- Computer skills: Actuaries must know programming languages and be able to use and develop spreadsheets, databases, and statistical analysis tools.
- Interpersonal skills: Actuaries serve as leaders and members of teams, so they must be able to listen to other people’s opinions and suggestions before reaching a conclusion.
- Math skills: Actuaries quantify risk by using the principles of calculus, statistics, and probability.
- Problem-solving skills: Actuaries identify risks and develop ways for businesses to manage those risks.
The average pay for actuaries in the United States ranges from $63,260 to $206,820 as of May 2021.
The specific pay depends on factors such as level of experience, education and training, geographic location, and specific industry.
Employment of actuaries is projected to grow 24 percent from 2020 to 2030, much faster than the average for all occupations.
Actuaries will be needed to develop, price, and evaluate a variety of insurance products and calculate the costs of new risks.
Actuaries must have a strong background in mathematics, statistics, and business. Typically, an actuary has an undergraduate degree in mathematics, actuarial science, statistics, or some other analytical field.
To become certified professionals, students must complete coursework in economics, statistics, and corporate finance.
Students also should take classes outside of mathematics and business to prepare them for a career as an actuary. Coursework in computer science, especially programming languages, and the ability to use and develop spreadsheets, databases, and statistical analysis tools, are valuable. Classes in writing and public speaking will improve students’ ability to communicate in the business world.