DECEMBER 2016 theactuary.com
Interview Andrew Brem The magazine of the Institute and Faculty of Actuaries
A digital revolutionary on the business of disruption
BUILDING BRITAIN Assessing the impact of Brexit on infrastructure investment
Pandemic risk and modelling approaches
Technology Taking advantage of innovation in insurance
Insurance A shared-value approach to healthy living
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“Infrastructure is the pillar of economic development and therefore subject to changes in the economic, political and investment landscape after Brexit”
18 30 UP FRONT 9
IFoA news The latest news, updates and events from the Institute and Faculty of Actuaries
Editorial Richard Purcell looks back at the events of 2016 and forward to new industry innovations
President’s comment Colin Wilson discusses the review of the composition of Council
CEO’s comment Derek Cribb explains how partnering with the SOA has promoted the CAA Global qualiﬁcation
AT THE BACK
14 Interview: Andrew Brem
Richard Purcell and Stephen Hyams talk to the chief digital oﬃcer of Aviva about the challenges of digital transformation
22 Technology: Innovation boom InsTech is growing at a rapid pace, says Paulo Cuomo, as he outlines how ﬁrms are taking advantage of technology
26 Pensions: Ready for robo
Richard Silveira says it is reasonable and necessary to question the tenets of central banks’ mandates
MORE CONTENT ONLINE Additional content can be found at www.theactuary.com
COVER: BORIS LYUBNER / ALAMY
34 Student Jessica Elkin turns Christmas angel, spreading seasonal joy to those who would rather say ‘bah humbug’
35 Puzzles The latest cryptic crossword and Mensa puzzles
David Stevens examines how roboadvice could change the face of consumer ﬁnancial planning
36 People/society news
28 Insurance: Joined-up thinking
38 Actuary of the future
As technologies to monitor health improve, shared-value insurance is beginning to shape the future globally, says Andrew Scott
38 Appointments and moves Jennifer Sanders of PwC
30 Health: The inﬂuenza agenda 13 Soapbox: Missing a hot ticket?
Sonal Shah reviews Big Data in Practice by Bernard Marr
Matthew Edwards and Richard Marshall investigate whether pandemic modelling approaches are keeping pace with the wider body of knowledge available
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A deﬁning year Richard Purcell looks back at the events of 2016 and some of the developments and innovations bringing the industry forward
of quantitative easing to respond to economic shocks is causing an existential crisis for central bankers (p13). In terms of technology, we have also seen some signiﬁcant developments in 2016. The inventor and entrepreneur Elon Musk set out his vision to send humans to Mars in the next six years, while augmented reality has gone mainstream following the launch of Pokémon GO. Closer to home, insurers and other ﬁnancial organisations are waking up to the threat and opportunities that technology poses. Paulo Cuomo, co-founder of InsTech London, explains why we are beginning to see more innovation in insurance (p22). Meanwhile, Andrew Brem, Aviva’s chief digital oﬃcer, talks to The Actuary about how he is driving digital transformation across their business to stay ahead (p14). Certainly, one digital technology that is already changing distribution is robo-advice, as David Stevens explores (p26). Embracing the beneﬁts that technology can bring, Andrew Scott advocates a new category of insurance that shares with customers the value created (p28). Perhaps we will look back on 2016 as a deﬁning year, with innovation beginning to transform ﬁnancial services.
Another year draws to a close, and it’s certainly been an eventful one. There were a few big events we knew were coming, like Rio playing host to the ﬁrst summer Olympics in South America, the US presidential election, and a referendum on Britain’s membership of the EU. However, there have been a few unexpected developments along the way; in the world of sport, Leicester City deﬁed the odds to win the Premier League. Then there were the results of the EU referendum and US presidential election, unexpected by many and creating market uncertainty. This month in The Actuary, Francisco Sebastian reﬂects on what Brexit means for infrastructure investment (p18), while Richard Silveira questions whether the use
“There have been a few unexpected developments along the way”
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PartnerRe brings clarity to uncertain times.
p06_ACT.12.16.indd Partner Re FP.indd 1 6
15/11/2016 14:53 11:50 08/11/2016
Colin Wilson is the president of the Institute and Faculty of Actuaries
It’s your profession
The announcement of the joint venture with the US Society of Actuaries has led to the creation of CAA Global, the new accrediting body for the Certiﬁed Actuarial Analyst examination, which will help the qualiﬁcation reach its true global potential. We are now in dialogue with other actuarial associations around the world in the hope that they too will embrace this initiative and become destination homes for qualiﬁed Certiﬁed Actuarial Analysts. This and other recent events have crystallised in my mind the importance of working together as a profession, for the beneﬁt of the whole profession. As our refreshed strategy document published earlier this summer states, as a profession we are small, but through working together we are stronger. That has to be right, but it doesn’t just relate to how we interact with our sister organisations and other professions around the world. It is also true for the IFoA and its members. As an organisation we will be stronger if we work together, and by working together we will remain relevant too – relevant not just to you, but to those who use your services now, or will do so in the future. Of course, Council has a critical role to play here in setting the strategic direction for our profession and ensuring we fulﬁl our Royal Charter objective. So we need to be conﬁdent that this body operates as eﬀectively as possible and is constituted appropriately to meet our objectives. This is not to say that Council is not working well already – I believe it is. And it is certainly a committed and passionate group of volunteers. But there are questions over whether Council is fully representative of the diversity of our profession, and succession planning is a recurring issue.
Colin Wilson on the review of the composition of Council and how it presents an opportunity to have a say in how it serves your profession
This is why I have instigated a review of the composition of Council. I believe that it is critical that it reﬂects the diversity of the membership, both now and in the future. Allied to this, it is important that the governing body attracts the right people with the right skills and experience to fulﬁl its responsibilities. As a Council we have already started to think about these important issues – looking to the future and what this should mean for a modern, forward-thinking, progressive governing Council. But Council does not have a monopoly on great ideas. This is, after all, your profession. That is why I want to hear from you about what you want from your governing body, and how it should lead the profession into the future to ensure our relevance and our long-term sustainability. All too often in life, it is easy to stand on the sidelines and criticise decisions and actions that have been taken that you don’t necessarily agree with. Now I’m not saying it’s wrong to hold an opposing view. On the
“I believe it is critical that the composition of Council reﬂects the diversity of the membership, both now and in the future”
contrary, I welcome constructive challenge and aim to promote environments that encourage this, as I ﬁrmly believe that it leads to better decisions and outcomes. So please don’t stand on the sidelines; this is your opportunity to have a say in what is important to you and in what you believe Council can do for your profession. Ask yourself, should we continue to elect the whole of Council from a vote of the membership? Should the method of election be modiﬁed to help ensure that Council is truly representative of our members and where they work? Should Council look to appoint members to some seats around the Council table, or should these be given to lay people who could add a diﬀerent perspective? I do not underestimate the challenge that I have set myself and Council. I am also sure that there is no perfect answer; no silver bullet. But it is a challenge I believe we must rise to if we are to have a Council that is best placed to deal with whatever the future holds. Many of you belong to regional societies. I encourage you to discuss these issues and feed back your thoughts to me. If you don’t belong to a regional society, then please email me directly with your thoughts. Email firstname.lastname@example.org December 2016 • THE ACTUARY 7 www.theactuary.com
Derek Cribb is the chief executive of the Institute and Faculty of Actuaries
You will have read in Colin Wilson’s president’s comment column (p7) about a joint venture with the US Society of Actuaries (SOA) to promote the Certiﬁed Actuarial Analyst (CAA) qualiﬁcation on a global scale. We are proud to introduce the new enterprise, CAA Global, to the actuarial community. Its arrival has been the culmination of many months of hard work between the volunteers and Executive, and we’re all very proud of the outcome. CAA Global is a great example of our strategy in action. Globally, the actuarial profession is a small one, with fewer qualiﬁed actuaries across all the world’s bodies than in any one of the larger UK accounting bodies. It follows, therefore, that to ensure the sustainability of our profession, we are best when working together, across geographic boundaries. This is particularly evident when we can work together to broaden opportunities for the application of actuarial science in the workplace. I am delighted that all the hard work that has gone on behind the scenes in establishing this not-for-proﬁt, joint-venture organisation has helped it materialise oﬃcially. We had always planned that the CAA would be a recognised qualiﬁcation globally, and, with North America possessing the largest proportion of qualiﬁed professionals within the profession, ﬁnding a regional partner was key to success. So we are delighted that the SOA has joined us as that partner. The CAA is designed to give those working alongside actuaries, and in the broader ﬁnancial services sector, a path to acquire sound technical skills and membership of a professional body. It brings those who are using actuarial skills into a regulatory framework that will help them develop in their careers, and assure public conﬁdence in the work that they are doing. The CAA has also been promoted by the World Bank and non-governmental organisations as a key tool in growing actuarial capacity in emerging markets. In the two years since the CAA was launched, we have grown to having 400 candidates spread across 40 countries, and with this new venture we hope to further strengthen the CAA community.
Derek Cribb explains how partnering with the US Society of Actuaries has enabled promotion of the CAA qualiﬁcation globally Key to delivering on our public interest promise is our future sustainability. With initiatives such as CAA Global, we can look forward to a future where we are opening up new opportunities to promote actuarial science and to regulate its practitioners at all levels. Having an actuarial-based qualiﬁcation will be an attractive option, not only for those that wish to specialise but also for those working across the business world – from technicians to CEOs. CAA Global is an independent entity, with its own board of directors at the helm, who will run the company independently from the shareholders – the IFoA and SOA. The joint venture is not, however, a new professional body. It is a qualifying body to ensure that we can maintain a global standard for those professionals reaching CAA status. Wherever you are in the world, as a CAA your level of qualiﬁcation will be of a guaranteed standard and not subject to the variances seen at other levels. We have learnt from the Chartered Enterprise Risk Actuary (CERA) experience, and have set up CAA Global in such a way as to enable, indeed encourage, other actuarial
“I would encourage you to advocate actuarial skills as widely as possible; engage your HR directors, CFOs and CEOs in discussion”
bodies to join and help promote the profession together. The next step will be to accredit a number of other high-quality actuarial associations to be able to provide homes for those who have passed the requirements to claim the CAA title, and hope that in time these associations will join CAA Global as full partners. The creation of CAA Global sends a powerful message that, in our small profession, collaboration and consistency in our oﬀering is key to success. This must be heard not just through the actuarial world but also more widely by business and stakeholders. If we are to keep the profession in good health, we must all work hard to promote the profession, and the business and technical skills that those with actuarial training can bring. As your professional body, we are stepping up our promotional activity. But it is you – our members – who are best placed to carry this message. I would encourage you to advocate actuarial skills as widely as possible; engage your HR directors, CFOs and CEOs in discussion as to where else actuarial skills can be applied. The IFoA has recently invested in capability to develop new opportunities for our members to apply their skills. If you would like to help your profession grasp these opportunities, please contact us at email@example.com
THE ACTUARY • December 2016 www.theactuary.com
News ARIAL PROFESSION
Upfront Curriculum 2019 transition: what the changes mean for you replaced by personal and professional development (PPD).
With the September exam session results due to be released, now is the time for you to start planning what you should sit over the next four exam sessions, and which subjects to tackle next on your route to qualiﬁcation. Information on the Curriculum 2019 transition arrangements was published in October 2016, and a summary of the changes are as follows.
Qualifying To qualify as an Associate under the new curriculum, you will be required to complete all Core Principles and all Core Practices subjects, in addition to two years of PPD. To qualify as a Fellow under the new curriculum, you will be required to complete all Core Principles and all Core Practices subjects, two Specialist Principles subjects, one Specialist Advanced subject and three years of PPD.
Curriculum 2019 The curriculum covers the three main components to an actuarial qualiﬁcation: examinations, professionalism and work-based experience. We’ve designed it to ensure that our members are well prepared for the future, and it sees a number of changes to the structure, content and delivery of the IFoA’s examinations. Stages There are still four key stages to our examination structure. However, there have been some changes to better reﬂect what is required at each stage. ● The Core Technical (CT) series becomes the Core Principles series and focuses on three modules: statistics; mathematics; and business. ● The Core Applications (CA) series becomes the Core Practices series and also has three key modules: actuarial practice; modelling; and communication.
CPD: do it your way As the CPD scheme focuses on your own learning, when attending an event, it is left to your discretion to determine the learning gained and time spent doing so. Each member will gain something diﬀerent from an event attended, therefore we rely on you to record the actual time spent engaged in learning, ensuring that it is relevant to your work or role, and meets a personal development need. CPD 2016/2017 scheme: bit.ly/2f4OTCL
● The Specialist Technical (ST) series becomes the Specialist Principles series, and continues to require you to demonstrate a thorough understanding of the concepts of the speciﬁc specialist subject. ● The Specialist Applications (SA) series becomes the Specialist Advanced series, and continues to require you to apply speciﬁc knowledge of actuarial practice to the provision of deﬁned practice areas. Alongside the outlined changes to the four examination stages, the work-based skills (WBS) requirement of your study path will be
Dates The ﬁrst exam session of the new curriculum will take place in April 2019. This gives current and future students over two years to continue sitting exams in the current system before the transition to the new subjects. The exam dates for the 2017 and 2018 exam sessions have already been published on the IFoA website, and should be used to aid in any planning. Exam booking for the next session opens at the end of January 2017. Before booking, you should consider the new curriculum carefully and take into account the choice of subjects you sit and the corresponding study hours. Detailed information on the new curriculum, the 2017 and 2018 exam dates, and the recommended studying hours can all be found on the IFoA website. Curriculum 2019: bit.ly/2fcgYbu Exam dates: bit.ly/2fdvTTp Study hours: bit.ly/2fDW20p
‘Guinea Pig 1’ exam reviewers required Congratulations to students who have recently qualiﬁed and are now in a unique position to help support the IFoA in the review of the new session exams. As a ‘Guinea Pig 1’ exam reviewer, you will review and comment on the content and accuracy of exam papers before they are delivered to our students around the world for the 2018 session.
Past reviewers have commented on how rewarding the role is and how it contributes to the work of the teams that create and deliver the IFoA’s exam papers. Are you interested in applying? All our new qualiﬁers are invited to apply to join our bank of professional development and responsibility (PDR) supporters. You can ﬁnd full details about the role at bit.ly/1RRfthI, or email firstname.lastname@example.org
December 2016 • THE ACTUARY 9 www.theactuary.com
Don’t forget to pay your 2016/2017 subscription To avoid default of your membership, please ensure you pay your 2016/2017 subscription by 31 December. Log into your members’ area of the website at www.actuaries. org.uk and select ‘my account’, then ‘my subscriptions’. If you wish to cancel your membership, please let us know. Overseas members who wish to apply for partial regulation (bit.ly/1IW6z9G) should send their completed certiﬁcate of eligibility (bit.ly/1HCKY6R) to the membership team ASAP. For reduced rate subscription application forms visit (bit.ly/2fCE0bM) and return by 31 December 2016. If you have any questions or require help, please email membership@ actuaries.org.uk or call 0131 240 1325
Disciplinary tribunal hearing At a disciplinary tribunal panel hearing on 14 September 2016, the panel considered a charge of misconduct that Mr Tarun Grover (student) and Ms Tripti Gulati (lapsed member) had cheated on the Institute of Actuaries of India (IAI) CT2 Finance and Financial Reporting examination and that this behaviour had been dishonest. The panel found the facts proven on the basis of the respondents’ respective admissions to the IAI and also Ms Gulati’s admission to the IFoA. In respect of the allegation of dishonesty, the panel also found that matter proven by applying the legal test of dishonesty to the evidence submitted. The panel found that the respondents’ actions were in breach of principle 1 of the Actuaries’ Code and, in any event, constituted misconduct in terms of rule 1.6 of the disciplinary scheme. As a result of the ﬁnding of misconduct, the panel imposed the following sanctions: ● Expulsion from membership of the IFoA for two years for Mr Grover; and ● Exclusion from membership of the IFoA for two years for Ms Gulati. The full determination, including the panel’s reasoning, is available at bit.ly/2dRPsBW
Changes in how to determine SMPIs The Financial Reporting Council (FRC) has published a revised version of Actuarial Standard Technical Memorandum 1 (AS TM1), which sets out the basis on which to determine annual statutory money purchase illustrations (SMPIs) should be determined. It includes two amendments, following changes by the IFoA’s Continuous Mortality Investigation (CMI) to the mortality tables speciﬁed in AS TM1. These are the same as those made by the Financial Conduct Authority (FCA) for point-of-sale and in-force business projections in PS16/12: Pension reforms – feedback on CP15/30 and ﬁnal rules and guidance. The revised standard is eﬀective from 6 April 2017. The revised standard and rationale for the changes can be found at bit.ly/2ﬂ7lqb
CAA Global: creating a truly global qualiﬁcation On 20 October 2016, the IFoA and the Society of Actuaries (SOA) joined together to form a not-for-proﬁt, joint-venture body, CAA Global, to deliver the Certiﬁed Actuarial Analyst (CAA) qualiﬁcation around the world. This is a truly exciting opportunity for the actuarial profession, as we seek to establish actuarial techniques, training and experience not just in the traditional actuarial sectors but in the broader ﬁnancial markets around the world. Since launching CAA Global, we have seen over 200 people register their interest from over 20 diﬀerent countries. This builds on the widespread interest in the qualiﬁcation that has developed since the CAA was launched by the IFoA in 2014. This positive early response to CAA Global paints a bright picture for the future of the qualiﬁcation. It also demonstrates that, as a professional community, we are stronger when we are working together for the beneﬁt of the whole profession. The CAA qualiﬁcation is designed to give those working alongside actuaries, and in the broader ﬁnancial services sector, a path to
acquire sound technical skills, and to bring them into a regulatory framework that will help assure public conﬁdence in the work that they are doing. The CAA also facilitates the growth of actuarial capacity in emerging markets, where it is just starting to develop. If you are a current Student Actuarial Analyst (SAA), changes are being made to your membership category, so ensure that you check out our FAQs (bit.ly/2fduGM0). One of the key audiences for the UK has been school leavers, as evidenced by the introduction of actuarial apprenticeships. In October, the IFoA’s careers team launched a campaign called Careers that Count to raise awareness of actuarial apprenticeship opportunities for school leavers. We are proud to work with employers through these apprenticeship schemes, as they have been instrumental in developing the qualiﬁcation for this market. Read about the Careers that Count campaign at www.actuaries.org.uk/careersthatcount For more on the CAA qualiﬁcation, please visit www.caa-global.org Email us at: email@example.com
BDM achieves QAS accreditation We are pleased to announce that Bradshaw, Dixon & Moore Ltd is the latest organisation to be awarded the IFoA’s Quality Assurance Scheme (QAS) accreditation. The QAS is a voluntary scheme for organisations (or identiﬁable parts of) that employ one or more members
of the IFoA. Whether applying for the whole business to be accredited or just one department, it is a strong statement of quality that will be recognised throughout the industry. For further information on how to submit an application, please visit the IFoA website at www.actuaries.org.uk/ QAS. There are some helpful videos and FAQs to talk you
through the application process and preparation. If you’d like to have an informal chat about QAS, contact quality compliance manager Sarah MacKenzie. Email: sarah.mackenzie@ actuaries.org.uk Phone: 0131 255 0286
THE ACTUARY • December 2016 www.theactuary.com
CPD: separating facts from ďŹ ction Lifelong learning is one of the hallmarks of a professional: it demonstrates commitment to excellence, supports development and has the potential to mould us into more rounded professionals. As members of the IFoA, your overarching Actuariesâ€™ Code obligation to maintain your competence is directly supported by the principles embedded in our continuing professional development (CPD) scheme. In the sixth, and ďŹ nal, instalment of this series, which focuses on the practical aspects of the CPD scheme and challenges common misconceptions, our general counsel, Ben Kemp, is in conversation with ďŹ ctional member Zeedan Khan, a life actuary in Wales, planning a period of shared parental leave.
Khan I am a Category 2 member and hope to take around ďŹ ve months of shared parental leave next year, following the birth of my child. The date isnâ€™t set in stone, as much depends on when my partner feels ready to return to
work â€“ thereâ€™s a chance that the leave will be split over two CPD years. Will that be aÂ problem? Kemp Weâ€™ve recently made changes to the CPD rules, designed to make sure that it applies fairly to members in Categories 2 and 4. So long as you are absent for at least one month in each CPD year and the total absence is three months or more, you can apply for a partial exemption from the full requirements for each aďŹ€ected CPD year, which runs from 1Â July to 30 June. Khan Thatâ€™s good news. I was wondering how I might manage to ďŹ t learning around the time away from the oďŹƒce. I donâ€™t like the idea of cramming in activities just to achieve the required 15 hours. Kemp We agree â€“ itâ€™s much more important that you engage in learning that oďŹ€ers a real beneďŹ t to you and is relevant to the work you do. Equally, we donâ€™t expect you to be trying to do CPD while you are looking after your child â€“ we recognise that you will have your hands quite full enough during this period! Khan What will a partial exemption mean
for me in practice and how do I go about getting one? Kemp Simply ďŹ ll in the exemption application form (bit.ly/2ew48mI), available on our website, and return it to the membership team at cpd_feedback@ actuaries.org.uk. Weâ€™ll then be able to conďŹ rm your CPD requirements for the year. The required number of hours of activities will be reduced according to the length of time youâ€™re away from work. If you have any questions, the team will be happy to help you. Khan Although I have dates in mind for the leave, it is possible they might change. Should I wait until my plans are conďŹ rmed? Kemp Itâ€™s a good idea to keep the membership team up to date â€“ Iâ€™d make the application now on the basis of the dates you are planning, then update them if anything changes. Remember to let us know how to get in touch with you away from the oďŹƒce â€“ a personal email address or mobile number, so we can pass on important news orÂ updates. Khan Thank you â€“ Iâ€™ll do that. Kemp No problem, and congratulations!
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The IFoA Autumn Lecture 2016 7 December, 17.30, EICC, Edinburgh
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December 2016 â€˘ THE ACTUARY 11 www.theactuary.com
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The IFoA Asia Conference 2017 11-12 May 2017, Hong Kong
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2016 Conference attendees by practice area: Pensions 1%
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Dr Konstantinos Drakos is Richard works for associateSilveira professor at Athens Deloitte’s markets group Universitycapital of Economic
Crisis for central bankers? Since the 1970s, central bankers have conducted their business with two aims in mind; stable economic growth and low retail price inﬂation. But is the current mandate too restrictive? The shock of 2008 instilled an extreme aversion to risk. Central bankers and investors are locked in a perennial staring contest. Rumours of a rate increase spook the market and policy is re-assessed, creating a bizarre paradox whereby central bankers have become the movers of markets and not their safety buﬀer. The trend originated with the tenure of Alan Greenspan at the Federal Reserve in the late 1980s, continuing throughout and since the ﬁnancial crisis. The ‘Greenspan put’ is the set of policies enacted to deal with ﬁnancial crises, generally through cutting rates and increasing liquidity to support falling asset prices and the economy.
Unintended consequences of policy From a UK perspective, a worrying aspect of recent unconventional monetary policies is the impact on house prices and pensions, and the seemingly indiﬀerent attitude of some policymakers in government and the BoE. The former pensions minister Ros Altmann has voiced concerns, recently echoed by William Hague and others, while the economist John Kay succinctly describes the eﬀect of monetary policy since 2008 as having been “to transfer wealth to those who already hold long-term assets – both real and ﬁnancial – from those who never will.” It should be acknowledged that ﬁscal and monetary objectives and policies are not mutually exclusive. To the extent that monetary policy prevents a global meltdown as it did in 2008, great. But to the extent that it keeps asset prices inﬂated above fundamentally sound valuations and placates investors, ﬁscal stimulus could be more eﬃcient. To illustrate the point, investment in infrastructure is overdue and needed. Government borrowing to invest could produce tangible growth in the economy without the toxic side eﬀects, and borrowing costs for the government are near to an all-time low.
Richard Silveira says that it is now reasonable and necessary to question the tenets of central banks’ mandates Granted, there will always be political aversion to signiﬁcant investment, since elected governments are generally averse to running up the national debt for projects that will not yield short-term beneﬁts (votes). So what is the right level and type of inﬂation to target? Globally, the issue of inﬂation is complicated by the rapid expansion of technology in new and innovative ways that continues to reduce the price of goods and services. So what is the sweet spot that optimises aggregate demand? The widely used ﬁgure of 2% was conceived when negative rates were fantasy. With rates stagnating near to zero and realised inﬂation falling below expectations, do inﬂation targets need to be re-assessed downwards? Few would wish for deﬂation, so a positive target is sensible, but if the target cannot be met even with continuous QE then perhaps it’s time to look again. There is retail price inﬂation, but what of other assets including house prices and pensions? They are central to the economy, yet no explicit mandate is given to the central bank in respect of them. It is risible to suggest that unabated house price growth well beyond salary growth is good for the economy, yet that is exactly what
“From a UK perspective, a worrying aspect of recent unconventional monetary policies is the impact on house prices and pensions”
has precipitated in the UK in recent years. While the impact on deﬁned contribution schemes could be viewed as broadly neutral (increased asset prices but reduced annuity rates), a continued policy of near-zero rates is likely to mean that the few remaining deﬁned beneﬁt schemes still open to accrual will close.
Change is needed It is reasonable and necessary to question the tenets of central banks’ mandates. The extent to which they intervene in ﬁnancial markets has a material impact on the long-term economy that is, by their own admission, largely unknown. The traditional metric of targeting retail price inﬂation is too restrictive, and the danger of asset price bubbles has to be recognised and included in the mandate. In his 1977 thesis, Alan Greenspan wrote: “There is no perpetual motion machine which generates an ever-rising path for the prices of homes.” Thirty years later, as chairman of the Fed, he implemented policies that incubated the sub-prime mortgage crisis. The dangers were apparent and yet ignored. Some will argue that central bank independence precludes political interference or oversight. Yet in the UK and elsewhere, QE can be tantamount to monetary ﬁnancing a country’s deﬁcit through the purchase of government bonds. An honest discussion needs to be had in apportioning responsibility for the economy. Pragmatism not dogmatism should be the way forward. December 2016 • THE ACTUARY 13 www.theactuary.com
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Andrew Brem is no stranger to business disruption. During his time as managing director of commercial and product development at British Gas, he launched the Hive app, a smart thermostat for digitally and remotely controlling home heating and lighting. In his current role with Aviva, he is able to draw similar parallels, explaining: “You’ve got a business which is respected but not loved, and a product which is required but not loved.” Brem’s retail background was instrumental in his appointment as chief digital oﬃcer at Aviva. As he recalls: “For me, what was so compelling was the sense that the insurance and related ﬁnancial services industry is ripe for massive transformation. It’s an incredibly un-retail experience, in that you have to answer a load of questions, at the end of which you just beg for a quotation and then you go back and forth. The revolution in customer experience is for us to say – we already know you and can infer most of the other things we need to know.” He continues: “We see digital as both a business and a set of capabilities that we can apply across the entire business. Our interpretation is that it is about customer engagement; customers making smart decisions about the things that they buy.” He adds ﬁrmly: “We are aligned with our consumers in that we want to help them prevent bad things happening rather than ﬁx them when they do happen. Our purpose is to free people from the fear of uncertainty.” We meet Brem in Aviva’s Digital Garage in the heart of London’s Tech City in Shoreditch. The trendy location is in keeping with Brem’s desire to move away from the more traditional culture of the insurance industry. He explains: “We’ve got digital activity in all sorts of places, but our garages in London, Singapore and Toronto are where we bring together all our key digital skill sets. We also run businesses from our garages and that’s a cultural point. Yes, we stretch our thinking, but I remind colleagues that it’s not all about tomorrow’s consumers, it’s about today’s and yesterday’s ones; we are late to the party, so I really want this to be a very practical place.” He says they also partner with or make investments in start-ups, “which is more complicated in
The digital revolutionary Andrew Brem, chief digital oﬃcer of Aviva, talks with Richard Purcell and Stephen Hyams about the challenges of digital transformation to create a better customer experience
THE ACTUARY • December 2016 www.theactuary.com
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PHOTOGRAPHY: TOM CAMPBELL
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December 2016 • THE ACTUARY 15 www.theactuary.com
On my agenda email@example.com
ﬁnancial services because of the regulation, underwriting and the way the industry is set up”.
Customer engagement Brem is excited about the opportunities of mobile phone technology. “The barrier for engagement is lower, in that mobiles are great for nibbling at things, spending a few minutes here or there. Some of the digital experiences that we’ve launched might only take 10 minutes, but they start you on a journey of intelligent engagement.” He sees this as particularly helpful for some of the complex decisions around savings and investments. “For me, app and mobile are morphing into the same thing; the mobile internet is rapidly becoming as good as a native app.” He is keen to explain the power of providing useful things to customers, such as the Aviva Drive app, which measures driving skills. “The purpose is serious because we want people to drive safely. You can think of that as a theme; socially engaging experiences that on one level are just interesting, funny or sharable, but on another level are educational and deadly serious. That’s what’s been lacking in ﬁnancial services.” Home Checker is another innovation, informing homebuyers about their new neighbourhood. Brem says: “I don’t want anything back, apart from people saying, ‘those Aviva guys are thinking about us for once’. If we do that 100 times, we will fundamentally change the role of our business in consumers’ lives.” Brem explains how most of the tools available are based on numbers, like how much money will you need after retirement. “That’s not how most people think, but if you say what kind of a house or apartment you might live in, what sort of support do you want to give your children, then people can make meaningful choices.” In Shape My Future, they have a mobile experience to help people plan how much they need to save to achieve their lifestyle aspirations in retirement. There is also a little quiz to determine savings behaviour, “at the end of which you’re matched to one of nine superhero behavioural types, funny and quirky but based on a statistically signiﬁcant survey”. Their chief designer previously worked for the video game franchise Call of Duty, relevant since “gaming psychology can be really useful; behavioural tools used for good rather than evil, but without them people are just not doing anything at all”. Inevitably, we turn to robo-advice, which Brem believes means diﬀerent things to diﬀerent people. “For me, it is using a well designed set of behavioural questions to ﬁgure out a consumer’s risk appetite, designing an investment portfolio to meet that appetite and then auto-rebalancing it.” However, he adds: “I think that where it is less developed is around the complex choices between savings accumulation and decumulation, and I do believe that digital in its many guises has a role to play in helping consumers make good choices around that period of their lives.” 16
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“We talk about pre-merchandising; on the shelf are the things you already have and then the things that you don’t have but could do. In other industries that is just convenience, but for us it’s cleverer than that because we’re trying to answer the questions that we would otherwise have to ask customers. We call it ultimate tailoring and one-click convenience.” Brem considers this as being more about engagement rather than cross-selling. “By giving consumers things that are genuinely useful, along with good propositions at the right price, why would they not choose us in due course? “Our industry has been quite traditional in terms of marketing and cross-selling, but consumers now expect you to pop up at the most relevant point and in the most relevant way to them, which is not necessarily on your own website.” He clariﬁes that this targeted approach to customer engagement uses customer analytics and internal or external data. The other aspect of data analytics relates to risk and pricing, where they ﬁnd interesting correlations of risk between apparently unrelated products, such as savings behaviour and motor insurance. Brem explains: “There are companies other than insurers that have access to third-party or public data, are brilliant at analytics and may have well trusted brands. This could be questioning the role of insurers existentially, and that’s why I want to be part of that.”
Opportunities and challenges Internationally, Brem is equally ambitious and eﬃcient. “We plan for global deployment, but we don’t deploy the same things everywhere. More to the point, our strategy is not identical everywhere.” He points out that in the UK the digital strategy is focused on direct-to-consumer sales, whereas in other markets they work through tied agents or with aﬃnity partners. “What surprises me the most is that the things people buy are really rather diﬀerent. I don’t think it’s because the consumers are so diﬀerent, but more that there are other interventions in the industry that has caused it to be diﬀerent. “Aviva has a very interesting presence in Asia, and this is where I see the most groundbreaking digital behaviour. It is partly because you have a whole generation of consumers that never had ﬁxed internet and they do everything on their phones.” Brem adds: “It’s interesting that there is not one place that has it all, but with us being in Silicon Valley, London and Asia, we are hooked into the key digital ecosystems of ﬁnTech.” Brem comments more generally on the role of technology: “Like many big insurance companies, we have a myriad of back-end systems that until recently didn’t talk to each other, so we had to connect them up. More revolutionary is the way our front-end digital developers work.” He explains that they work in multidisciplinary teams and in short sprints, typically one to two weeks, so they can quickly test and
This could be questioning the role of insurers existentially, and that’s why I want to be a part of that” obtain feedback from consumers. He also describes how application programming interfaces (APIs) have been digital enablers, “making it much easier for people to connect up systems without opening the bonnet”. This leads us neatly onto the introduction of the pensions dashboard, collating people’s pension savings across multiple providers. Brem is enthusiastic: “The fundamental idea is brilliant for consumers and one that we embrace.” However, he thinks in focusing solely on pensions it does not go far enough, noting that there are several similar options in the US and UK that connect multiple credit and debit card accounts. He believes the industry could do more to combine products of diﬀerent types, such as general and life assurance. Having diﬀerent regulators does not help, but to consumers the distinction is not important. The challenges involved in the digital transformation are not underestimated by the CEO, Mark Wilson, who in the early days told Brem in all seriousness “I haven’t had nearly enough complaints about you” – reinforcing how digital is expected to disrupt the business. Brem says they talk of the transformation as being 2% complete; the ﬁrst step being for all 33 million customers to have a digital relationship with the company and “for them to ﬁnd that experience relevant, engaging, entertaining and educational, so they come back frequently”. He adds: “Many consumers are more open to trusting new brands than in the past, so it’s incumbent on us to do a damn good job pretty fast to get loved.” We ﬁnish by asking Brem what advice he has for aspiring entrepreneurs. “Have no fear of failure, try and try again. A lot of us are perfectionists and think we’ve got to get it right before it goes out there, but that’s not the spirit of an entrepreneur. It’s also going to take longer than you think. Because you can build an app in a weekend, people think that you can build a great business in a weekend.” Good advice from a maverick who knows what it takes to succeed in a fast-moving business world. December 2016 • THE ACTUARY 17 www.theactuary.com
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Francisco Sebastian explains the possible impact of Brexit on infrastructure investment in the UK
n o g n i k n i n a g B ildin bu
Domestic investors, notably pension funds and insurers, have been adding UK infrastructure to their portfolios in the past few years, as the asset class provides longer duration cashﬂows to match liabilities and its liquidity premium enhances yield. Infrastructure is a pillar of economic development, and therefore will be subject to the changes in the economic, political and investment landscape that are expected to materialise following the result of the Brexit referendum. Moreover, as infrastructure represents a large fraction of total ﬁxed capital formation and is a primary vehicle for public expenditure, it will play a crucial role in shaping the UK’s economy during and after Brexit implementation. This complex, dynamic environment provides an intellectual challenge that makes some actuaries feel like a child in a sweetshop. Brexit will most likely entail an unprecedented change in the UK’s regulatory and institutional environment, which aﬀects internal economic growth and the relationships with the EU – the UK’s main trade partner (accounting for 43.8% of exports of goods and services in 2015) – and with the rest of the world. The growing political and social tension in Scotland and Northern Ireland has also boosted the (already high) level of uncertainty, as the economic policy uncertainty index shows. In the aftermath of the Brexit referendum, gilt yields reached historical lows. This is the combination of increased perception of risk with
T I X E n R i B rita B BORIS LYUBNER / ALAMY
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the Bank of England’s subsequent expansionary reaction and additional measures, which are intended to pre-empt potential disruption in lending markets. Along with interest rates, and with the increased uncertainty, the British pound has declined around 10% and 14% versus the US dollar and the euro respectively, reaching multi-decade lows. With policy uncertainty soaring, real investment is likely to be subdued, which would dent economic growth in the short term. Furthermore, the erosion in purchasing power from the decline in the currency is expected to bolster inﬂation in the coming months. The combination of policy and institutional uncertainty, lower economic growth, higher inﬂation expectations, lower yields and weaker currency aﬀects valuations of both existing and planned infrastructure assets.
Implications on valuations In the base case scenario of short-term economic slowdown and lower yields, most infrastructure assets are likely to preserve or increase value relative to other investments, for several reasons:
Cashﬂow resilience: In most cases, infrastructure services are oligopolistic, with high-entry barriers, and cover basic household and business needs. These features make demand for infrastructure services, such as energy, communications, lodging or transportation, partially stable during periods of general economic slowdown. ● The overall inﬂationary environment may strengthen the case for infrastructure operators competing in domestic markets to increase fees. ● Furthermore, for ports, airports and certain energy operations competing at international level, the currency depreciation boosts their competitiveness. ●
Lower funding cost: As most infrastructure projects are heavily reliant on borrowed funds for long periods of time, the lower interest rate environment is also positive. ● Although it is reasonable to expect that uncertainty increases risk premia, funding is likely to continue to be widely available, because mature projects’ revenue stability underpins their credit quality; and monetary policy will most likely continue to be supportive. ●
In summary, existing infrastructure projects should be able to withstand the economic slowdown and uncertainty spike scenarios. Valuations may be positively aﬀected, owing to the combination of steady cashﬂows and lower interest rates, with contained risk premia. However, some sub-sectors that bank on the UK economy’s openness may be an exception to the aforementioned positive eﬀects; commercial real estate valuation growth started gaining momentum in 2013 and peaked at the end of
December 2016 • THE ACTUARY 19 www.theactuary.com
2015. International demand was a catalyst for London. transaction price growth, especially in London These investors did not always seek to capture the economics of the property, but rather used the assets as means to preserve value and for their relatively high liquidity. The downturn in valuations started in early 2016, triggered by the changes to Stamp Duty in the March 2016 budget, which introduced an extra transaction cost that made these assets less competitive internationally. Legal uncertainty from Brexit is amplifying this eﬀect, as London’s status as a global ﬁnancial hub is questioned, which could eventually lead to weaker demand, lower rents and more scarce liquidity. Furthermore, Brexit may also have negative consequences on valuations of future infrastructure projects:
Figure 1: Economic uncertainty policy index 1200
0 1 1 1 7 8 7 7 8 9 2 2 3 3 3 4 5 9 6 9 6 4 4 5 6 00 00 00 00 200 200 200 200 200 200 200 200 2010 2010l 201r 201 201 t 201 l 201 201 201 201 l 201 201 201 201 2020 t t r r t u l l l n n n t n n2 t2 l2 r2 t r r Ja Oc Ju Ap Jan Oc Ju Ap Jan Oc Ju Ap Ja Oc J Ap Ja Oc Ju Ap Ja Oc Ju Ap Ja Oc Ju Source: policyuncertainty.com
Less competitive funding cost: Although the lower interest rate environment contributes to the decrease of the overall funding cost, the combination of systemic policy uncertainty from Brexit and projectspeciﬁc cashﬂow uncertainty may increase risk premia for projects in greenﬁeld stage.
Higher construction cost: Infrastructure often requires importing materials and specialised technology. The UK’s longstanding goods trade deﬁcit is a sign of dependence, especially on imports of basic materials, semi-manufactured, intermediate and capital goods. In most cases, these inputs cannot be replaced with domestic ones swiftly, because either they physically do not exist in the country, or developing the expertise to manufacture them would take years. Therefore, the UK will continue to depend on the rest of the world to develop infrastructure, and the currency depreciation will increase the cost.
Since 1997, the number of non-UK nationals working in the UK has increased from 928,000 to 3.34 million, with about two-thirds being EU nationals. Immigration from the EU has been crucial to sustain the high levels of activity in the construction sector, which is structurally understaﬀed. As the construction sector is crucial for future infrastructure development, any demographic changes from restricted immigration as a consequence of Brexit could further increase the labour shortage in the construction sector, increase the cost of new investments and the time required for completion.
Implications on capital supply Although the post-Brexit policy, institutional and economic framework is yet to emerge, the reaction from some investors is to postpone upcoming investment projects and to reevaluate ongoing ones. This is particularly critical for foreign investors, which are generally more sensitive to regulatory changes that may aﬀect their ﬁxed investments in the UK. The UK has historically developed strong ties in 20
investment with EU countries, which represent a large fraction of both direct and portfolio investments. The most evident implication on capital availability of Brexit is the potential discontinuation of the European Investment Bank’s funding programmes. The EU has developed a number of budget and ﬁnance programmes for infrastructure development.
Although the post-Brexit policy, institutional and economic framework is yet to emerge, the reaction from some investors is to postpone upcoming investment projects”
The European Investment Bank (EIB) and the European Fund for Strategic Investments (EFSI, aka Juncker Plan) are worth noting for the large size of resources available and their focus on infrastructure: ● The EIB is a ﬁnancial institution funded by the EU member states, with a mandate to invest in infrastructure and sustainable projects that contribute towards EU policy goals, notably environmental and climate change. The UK is one of the largest shareholders of the EIB, with a 16.11% stake, along with France, Germany and Italy, which have identical stakes. In 2015, the EIB lent EUR 7.7 billion to UK projects and businesses, which represents about 11% of total annual UK infrastructure investment from 2010/11 to 2014/15. Although the EIB provides capital for projects outside the EU, its primary business is within the EU. Therefore, funding from the EIB for UK projects would be subject to the terms of the relationship between the UK and the EU resulting from the negotiations. ● The EFSI is an initiative approved in 2015, under which a portion of the EU budget is used to guarantee ﬁnancing provided by the EIB. The plan targets projects in diﬀerent sub-sectors, with energy and transportation attracting about half of the funds. Prior to the Brexit referendum, the UK was the second largest recipient of funds approved for projects under the EFSI, with around EUR 1.4 billion. The Brexit negotiations will also aﬀect ﬁnancing available for the UK under the EFSI. In a Brexit scenario in which the UK no longer has access to the schemes above, the UK government could set up comparable ones domestically. However, in the meantime, funding available for new infrastructure projects will most likely be reduced. Furthermore, as those new schemes would be subject to the UK’s ﬁscal constraints (as opposed to the broader EU ones), availability of funding in the long term would
THE ACTUARY • December 2016 www.theactuary.com
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most likely be less stable and more correlated with the dynamics of the domestic economy. Domestic investors, notably pension funds and insurers, have been adding UK infrastructure to their portfolios in the past few years, as the asset class provides longer duration cashﬂows to match liabilities and its liquidity premium enhances yield. The outcome of the Brexit referendum, with lower yields, has made liabilities of deﬁned beneﬁt pension funds grow in excess of their assets, enlarging the size of the historical funding gap. Furthermore, the lower yields also trigger second-round eﬀects on the pension funds’ and insurers’ asset-liability management programmes, as duration from liabilities increases and these investors often struggle to ﬁnd non-government investments that can meet their long-duration requirements. As a consequence, the lower-yield environment has increased long-term investors’ need to search for yield, which is increasing demand for infrastructure investments. Capital supply for infrastructure from the public sector is also likely to become increasingly available as the UK government may continue with the infrastructure investment plans that the former leadership had deﬁned. Prior to the referendum, the UK
government had made infrastructure investment one of its priorities. In March 2016, the government released the National Infrastructure Delivery Plan (NIDP), which identiﬁes projects currently being developed and planned for the 2016-21 period. The total size of the investment is around £300 billion over the period, with nearly 50% of it coming from private sources. Although the NIDP stretches over diﬀerent sub-sectors, it is worth noting that the bulk of the investment focuses on transportation (rail, roads, airports and ports) and energy projects. From the public side, a major obstacle to the execution of the NDIP could be funding. Although the chancellor of the exchequer announced after the referendum that the deﬁcit reduction goals are likely to be relaxed, the slower economic growth and potential tax cuts may absorb part of the resources that could be allocated to infrastructure development. The Brexit referendum has made the growing discomfort with the EU re-emerge, which may also threaten new infrastructure development. Although the NDIP focuses on England and acknowledged devolution plans for Scotland, Northern Ireland and Wales, the risk of Scottish secession could jeopardise
certain large-scale, countrywide projects. The high degree of uncertainty that Brexit has created has had a positive eﬀect on valuations of existing infrastructure. However, it will most likely have a negative eﬀect on the expected returns of future projects, as well as investment dynamics. This creates a more challenging environment for investors (including insurance and pension funds), which have additional pressure to get returns from an asset class that is expected to be fundamentally less yielding. As international investors retrench, the UK government and domestic investors may ﬁnd it easier to get access to the asset class and continue to support infrastructure development.
is a Fellow of the Institute and Faculty of Actuaries and a member of the Infrastructure Working Party
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Risk. Reinsurance. Human Resources.
December 2016 • THE ACTUARY 21 www.theactuary.com
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‘InsTech’ is growing at a rapid pace, says Paolo Cuomo, as he outlines what companies are doing to take advantage of the innovations in technology available in the industry
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What do drones, a robot called Boris, start-ups with names such as SPIXII, Trov and Sweatcoin, the London Market Innovation Exchange, Blockchain, machine learning and a bootcamp for startups have in common? They’ve all played a part in this year’s meteoric growth around the topic of ‘insTech’ in London. But this is not just some trendy new idea in EC3. InsTech as a topic is le mot du jour globally, sitting at the top of insurance conference agendas across the globe, from the usual London, Zurich and Monte Carlo, to very ‘non-insurance’ locations such as Las Vegas, Barcelona and Cologne.
So, what is insTech? InsTech or insurTech is shorthand for ‘insurance technology’ or the topic of technology-driven innovation in insurance. It mirrors the term ﬁnTech, one that’s been in use for a number of years. It became common parlance with start-ups and innovators in 2015 and hit the mainstream at the start of 2016. InsTech covers a whole range of technologies and their applications, but one of the main strands involves data, creation of more data, collection of more data, analysis of that data and data-driven decision-making. For those who like hyperbole, there’s plenty of irrational exuberance to get excited about, but the more cynical among you should not forget Amara’s law, which states: “We tend to overestimate the eﬀect of a technology in the short run and underestimate the eﬀect in the long run.” As you may be aware, 27 October this year was the 30-year anniversary of the ‘Big Bang’. That change was as much about regulation as technology, but as Iain Martin details in his new book, Crash Bang Wallop, there were plenty of people who didn’t believe a computer-based data exchange could ever replace the traditional ways of working. Those most bullish about disruption are saying the combination of almost inﬁnite, real-time data from telematics, smart homes, social media and the internet of things (IoT) will fundamentally change the way we understand and price risk in classes as diverse as personal motor, med-mal and marine cargo. Not just the ability to better understand the risk at the start of the policy year but also the ability to consider the change in the risk on a near-real-time basis throughout the year. How many of us are set up to do that? Two of Munich Re’s recent investments have been in Trov and Slice Labs. Both oﬀer types of UBI (usage-based insurance) for personal goods and property cover. Cuvva (a Glasgow-based start-up) oﬀers a similar service with by-thehour motor cover. How many of us have systems (or mindsets) that allow us to price, communicate and bind instantly on an app for a four-hour camera, a one-hour motor or a two-day home cover?
Taking it one stage further, what will happen when we apply machine learning to risk analysis and pricing? Many insurance regulators require the ability for the carrier to explain the rationale behind pricing – if a blackbox machine learning tool, pulling in thousands of data elements, is able to more accurately understand and price risk, what does that mean? Take telematics – companies such as The Floow now have data about how people apply their brakes at every road junction in the UK (and increasingly in the US and China). Then there is the IoT, where companies such as Neos or Domotz are gathering staggering amounts of data about how you use your home. Satellites now take super-hi-res photos of much of the earth’s surface dozens of times a day – allowing companies such as Sky-Futures to let a claims manager ‘see the past’. Dtex Systems can build a near-perfect image of how every employee in a company is interacting with its hardware and software. These are companies you have never heard of doing things you never imagined you were interested in.
We’re not even talking about this in our organisation. Why not? As with many changes, things that feel big when you’re in the middle of them are not necessarily that large in the grand scheme of things. $1bn of insTech investment in the ﬁrst half of 2016 may seem large compared to the tens of millions in 2012 or 2013, but it’s still almost irrelevantly small in the context of other insurance industry investments and the current wave of mergers and acquisitions. As such, in most carriers and brokers there will be few people formally considering the technology innovation topic. The conversation is shifting however, as boards and leadership teams realise that technology innovation is part of the answer to many of their strategic challenges, rather than simply a distraction. The relevance of the change also varies by what your company does. Much of the initial change is happening in the business-toconsumer space, where diﬀerent ways of engaging with personal lines products, such as UBI, robo-broking and mobile-based knowyour-customer can get immediate traction. Those working in commercial lines or the Lloyd’s market may not be aﬀected so soon. Similarly, change happening deep in the back-end – where, for example, machine learning is helping to improve fraud detection in motor and health insurance – may not be immediately visible to someone working in a reserving or capital team. The warning, of course, is that if you wait until a new topic is front-of-mind before you engage in it, you’ll be starting with a distinct disadvantage compared with your peers and competitors. One young reinsurance buyer approached me recently, saying: “I’ve no idea December 2016 • THE ACTUARY 23 www.theactuary.com
PAOLO CUOMO is COO of Charles Taylor Managing Agency and co-convenor of InsTech London
A wave of tech-related new insurable risks – driverless car liability cover, drones – has forced underwriters and brokers to better understand technology” how all this insTech stuﬀ will impact what I do, but I’d prefer to be the one working that out, rather than simply have it done to me in ﬁve years’ time.” But is this just talk or is something actually happening? A year ago, this might have been harder to answer. Now it is an unequivocal: ‘yes – there is genuine traction’. Venture Scanner is now tracking well over 1,000 insTech companies, conferences focused on insTech are two-a-penny, and many of the large carriers have an accelerator or insTech investment arm (Allianz and Munich Re appear to have two accelerators each). According to this summer’s Pulse of FinTech report, from KPMG International and CB Insights, VC-backed insurTech investments hit $1 billion across 47 deals in the ﬁrst half of 2016, building oﬀ $2.5 billion of investments in 2015. At this year’s GIRO conference, the term insTech may not have been in broad use, but the theme of technology ran deep. Similarly, looking at the lead articles on the www.predictions2016.com website oﬀers up the words digital, data science, machine pricing, telematics, robo-investors and Blockchain.
Investors and innovators who cut their teeth in the banking sector have been looking for the next opportunity as the ﬁnTech space starts to ﬁll up Software suppliers, driven by changes in other, faster-moving industries, have moved beyond simply selling a software package for an annual licence fee to thinking about how new technologies can help their clients The general ‘tech upskilling’ of society has made us demand smarter tech usage in the workplace – we run our lives through smartphones, give our godchildren drones for Christmas, and see our kids doing 3D printing at school, for example A wave of tech-related new insurable risks – driverless car liability cover, drones, cyber and more – has forced underwriters and brokers to better understand technology and its implications The ‘big data hangover’ has ﬁnally worn oﬀ, so even though most of us are carefully avoiding the term big data, we are absolutely looking at what the new data sets can do for us – big, small, public, proprietary The whole ﬁnTech concept has now entered the mainstream, with tech start-up news moving beyond the specialist press to regular articles in the FT or The Economist (and The Actuary), as well as industry and political leaders such as Inga Beale and Sadiq Khan regularly referring to its importance.
Why now? Eighteen months ago, when I co-founded InsTech London, there were very few people talking about the insTech space. The growth has been driven by a combination of factors, including:
The actuarial singularity The term ‘technological singularity’, brought to prominence by American futurologist Ray Kurzweil, refers to the point at which machines becoming smarter than humans and so can start upgrading themselves faster than we could, leading to a runaway cycle of selfimprovement. The general consensus is this point could be around 2040. We are already seeing the combination of IoT-supplied data and basic machine learning making huge strides in supporting actuaries to do their work. Which year will it be that Edward Tredger or Alex Marcuson does a GIRO keynote speech convincingly showing the robot replacing the human? To avoid people drowning in the deluge of new ideas and terms, InsTech London has turned to a simple mnemonic as a starting point. TRAMBID identiﬁes seven technologies, which, in very diﬀerent ways, will dramatically impact the insurance industry: telematics; robotic process automation; augmented reality; machine learning; Blockchain; IoT; and drones. Each of these is aﬀecting diﬀerent aspects of the insurance value chain in diﬀerent ways and at diﬀerent speeds, but using this list as a starting point allows you to start thinking about what change is coming. For those of you who care most about data and data analytics, the ﬁrst, fourth and sixth items in the mnemonic are the ones to start understanding better.
Join the conversation Various initiatives are under way in all the usual insurance hubs. Here in London, we are blazing a very healthy trail. The InsTech London community now stands at well over 1,500 people, while the London Market TOM programme has recently launched its Innovation Exchange initiative, aimed at everyone operating in and around EC3. Signing up at www.instech.london is the simplest single way to engage with the conversation in London and further aﬁeld. For those of you based outside EC3, who’d like to get more involved, the insTech ecosystem would embrace ideas and activities from around the UK and abroad.
Figure 1: Frequency of ‘insurTech’ as a Google search term
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For discussion on technology-driven insurance innovation, sign up at www.instech.london Twitter: @pgc_at_work
THE ACTUARY • December 2016 www.theactuary.com
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David Stevens examines how roboadvice could change the face of consumer financial planning and the ramifications for the pensions industry and UK as a whole
The virtue of increasing consumers’
engagement in their ﬁnancial planning and self-provision, for individuals, our industry and UK plc is an obvious one. Indeed, the raft of recent market stimulus such as autoenrolment, extending ISAs, pension freedom reforms and the Financial Advice Market Review (FAMR) has been nudging and shoving consumers into action, energised by their increased choice and ﬂexibility. This all sounds good in theory, but there are three critical challenges that require attention if these changes are truly going to work:
1. Confused customers Paradoxically for many consumers, the joy of choice only serves to create complexity, confusion and resulting disengagement. And, sadly, the resulting inertia or poor decision-making could leave them with a feeling of under-achievement and disaﬀection with the whole point of saving in the ﬁrst place. Research consistently illustrates this – for example, the FCA reported in 2014 that 80% of customers purchasing an annuity lost signiﬁcant value by not shopping around.
2. Regulator’s role The regulator continues to unstintingly focus on fair outcomes for consumers. Unfair outcomes could arise from an asymmetry of knowledge or low consumer risk awareness. Although a strong regulatory presence is essential in ﬁnancial markets, the fear and consequences of getting it wrong can play out as a major inhibitor to innovation for providers and distributors, and so a balanced approach to bringing innovation to market is required.
3. Safe distribution from product and investment fund manufacturers These, playing their part in generating vast
PRODUCTS p26-27_dec_robo_advice_FINAL•CT.indd 26
DAVID STEVENS has
worked for LV= in a variety of senior positions across GI and life
However, in the world of ﬁnTech, things move fast and there is a breed of increasingly more sophisticated players emerging. These new ‘advice platforms’ construct a full fact-ﬁnd of the customer’s circumstances and preferences (assessing attitude to risk, ﬂexibility, investment experience). Through The need for expert and objective help to their reﬁned algorithms they automatically guide customers to good savings, product and generate regulated advice suitable for investment decisions and build consumer complex needs, such as an optimum conﬁdence has never been greater. This is retirement income, by presenting personal exactly the purpose of ﬁnancial advice and is recommendations of blended product the essential component that can serve to solutions sourced across both diﬀerent balance the interests of customers, product provider and product options. complexity and selection risk, enabling the Closely replicating what a human ﬁnancial market to function eﬀectively. adviser does today, it becomes apparent that This is a problem of a limited ‘human advice’ the more information robos learn about the supply in the UK today, owing to a sharp customer, the broader the range of advice drop-oﬀ in the number of ﬁnancial advisers to they can generate for substantially limited serve this increased need for expert help. So incremental eﬀort. using technology innovation to automate some While most of the current debate is or all of the complex processes, decision understandably framed around the extent to selection and documentation associated with which robo-advice can replicate or augment ﬁnancial advice has become a desirable and existing services, there is a more fundamental logical solution. consumer-, data- and technology-enabled revolution gathering on the horizon. It’s advice, but not as we If we dare to re-imagine how today’s know it consumers want to engage in their ﬁnancial The ﬁnTech phenomenon of so-called aﬀairs – that is, with elegant simplicity ‘robo-advice’ has created a hyperbole a Live links aand supported with trusted expertise of debate on whether it’s really on our possible for algorithms to safely – this revolution has the potential to p! replace what an experienced ﬁnancial app! rradically change on a mass scale how consumers make informed adviser does. And if so, can these h product selections that help lower-cost automated advice p them get the most from their solutions actually have the power to th hard-earned savings. generate user propositions that will help ha Bear with me. persuade customers to pay for advice to ﬁll the much-reported ‘advice gap’? The challenges for algorithms to eﬀectively Back to the future replicate a regulated service are undoubtedly So, imagine a world where the management of complex. They include accurate, digitalised your ﬁnancial aﬀairs is decluttered. Where data collection, turning human decisions into your personal ﬁnancial data, needs and ‘zeros and ones’, and creating the risk and preferences are securely aggregated through a governance controls to validate the systemic single expert app that enables you to quality of the automated advice. In addition, conveniently and holistically manage your the extent of seamless integration with banking, debt, savings, protection and human advisers (referral scenarios), an pensions decisions. The app, with ﬁve-star engaging user journey and smart software customer recommendations and from a brand engineering are all crucial sub-components you trust, analyses your data in-depth and of innovation. pro-actively streams expert personalised Robo-advice is a ﬁrm reality now, with ﬁnancial information, tips and, importantly, over 40 participants in the sector. Closer advice, which includes shopping around and examination reveals that most of these recommending products and solutions that aren’t fully ‘robo’ (and many don’t actually take account of your short- and long-term ‘advise’). Most to date focus on generating goals. An intuitive, interactive digital ‘simple’ discretionary investment fund experience, perhaps for a low-cost monthly solutions, typically from new direct-tosubscription, that also provides access to real consumer brands. But, increasingly, existing experts when you want them. In short, your advisory practices are seeking to adopt own personal ﬁnancial adviser ‘in your advice automation, integrating it with pocket’ helping you get the most from your their existing business models to gain the hard-earned savings. advantages of eﬃciencies and extended Other ﬂavours of imagination are customer reach oﬀered. also available. consumer choice, need to ensure their products are correctly participating in safe distribution, conﬁdent that the selection of their products represents fair value and good outcomes for their end-customers.
A load of old Hogwarts? It’s much nearer reality than fantasy than you might perhaps think, as many of the component technologies are already ‘out there’ or imminent. For example: ● Applications exist today that enable bank and credit card data to be consolidated, and with the ‘Open Banking Standard’ due to be in place by 2019, the ease with which customers can aggregate their data and move services will substantially increase. ● The FCA has launched Project Innovate and FAMR, which are now implementing a number of practical measures to encourage and support ﬁnTech and other solutions that make it easier for customers to access advice. Importantly, this includes the ‘Pensions Dashboard’, providing UK savers with an annual statement on all sources of pension savings accrued, commencing in 2017 and expected to be fully implemented by 2019. ● And, inevitably, social media and other data sources will increasingly empower customers to allow smart apps of their choice to use their information to tailor useful solutions relevant to them without any signiﬁcant eﬀort on their part.
Will robo be any cop? Practising robo-advisers are a reality today. As a result, customers can now beneﬁt from a fully regulated advice recommendation from the comfort of their own technology at a fraction of the price of a traditional advice service. Early adopters also hold the critical advantage from their ability to rapidly learn from the data and insights gained and develop the nextgeneration solutions. The emergence of sophisticated advice platforms that support a breadth of customer needs and integrate neatly into back-oﬃce applications opens up multiple ‘white label’ partnering options, fuelling new ‘help and advice’ propositions from trusted brands (not necessarily traditional ﬁnancial services players). Indeed, the availability of real choice of modernised help and advice apps or services may become the key distribution platform as customers learn to trust and value the speciﬁc provider and product recommendations they provide. The automation of high-quality, aﬀordable and convenient advice has the real potential to help UK consumers secure better outcomes with their complex savings and retirement decisions on a mass scale not achievable today. Whatever your views, the march of robo cannot be ignored and should be harnessed as a transformational opportunity for providers and distributors who wish to connect with consumers in a way that was perhaps, until now, unimaginable. December 2016 • THE ACTUARY 27 www.theactuary.com
Insurance Shared-value insurance
Joined-up thinking Andrew Scott shows how, as new technologies emerge with potential to monitor and encourage healthy living, shared-value insurance is beginning to shape the future of insurance globally
Shared-value insurance is emerging as a product category that is shaping insurance structures around the world. The business model simultaneously provides material beneﬁts to members, insurers and society; and is being scaled through a network of leading global insurers who are using the model in their markets to transform their oﬀerings, and the health of their members. We make profound cognitive errors about how long we will live, how healthy we are and what will kill us. While people seek better health, many do not act accordingly. The reason lies in a simple paradox: people over-consume healthcare but under-consume prevention. This is because at the point of care (with insurance or single payer systems), the total cost of healthcare is hidden, while many beneﬁts are immediate and evident, leading to over-consumption. On the other hand, with prevention, the price is immediate and evident (go for that dreaded run, avoid that desirable food), whereas the
beneﬁts are only evident in years to come, leading to under-consumption. Behavioural economists now know well the power of instant gratiﬁcation and our inherent over-optimism. We tend to be our own worst enemies when it comes to decisions about our health, with signiﬁcant implications for the societal cost of healthcare. Insurance also faces new opportunities in the form of disruptive technologies and increased customer expectations of the role of institutions in society. New technologies are emerging, with potential to enable individuals to live longer, healthier and more independent lives. In addition, social expectations of institutions have increased, given the ﬁnancial crisis and the growing inﬂuence of millennials. This generation demands that organisations act not only as proﬁtable entities but as purpose-driven ones too. Innovative approaches are required to take advantage of the emerging technologies and to build businesses with social impact. Of all industries, the insurance industry has a unique opportunity to align its commercial interests with making society healthier. Insurers, with government, are the only stakeholders that directly ‘monetise’ better health, reduced sickness and fewer deaths, because all of these translate into higher proﬁts. Yet traditional insurance models do little to recognise the behavioural nature of risk, let alone to be proactive in promoting and incentivising better health. Indeed, existing life insurance systems are based on the idea that risk is static, with underwriting taking place once, at policy inception. But, with sickness and mortality now overwhelmingly caused by lifestyle choices that are dynamic over a customer’s lifetime, this approach no longer makes sense. The case for disruption is strong.
28 THE ACTUARY • December 2016 www.theactuary.com
Live links on our app! p!
A virtuous cycle What does make sense is to make people healthier, and since this leads to increased proﬁts, some of these proﬁts could be used to provide incentives to customers to make healthier choices, fuelling a virtuous cycle of value creation and health improvement. This requires a business model that addresses the shortcomings of human behaviour and insurance design, integrating the two into a powerful form of insurance that actively promotes health. Vitality shared-value insurance, now used by a network of leading insurers across the globe, is one such approach. Vitality shared-value insurance supports, incentivises and rewards people for improving their health and prices insurance risk dynamically over the course of the policy, which results in material beneﬁts that are shared between members, insurers and society. The result is a structural transformation of insurance – additional economic value is unlocked, creating beneﬁts for the member (less risk, more years of life), the insurer (reduced claims over time) and society (healthier, more productive citizens). What makes the model unique is that there are no trade-oﬀs. This form of shared-value insurance is accepted as an exemplar of what Harvard management guru Michael Porter coins a “shared-value” business model – addressing social needs, proﬁtably. Porter argues that business models such as these are less a “nice to have” than an imperative for long-term growth, particularly in today’s age, where civically minded millennials will only endorse institutions that respect both proﬁt and purpose. The World Economic Forum contends that we are on the cusp of a fourth industrial revolution. This will build on previous technological
leads strategic initiatives across the Vitality Network
inventions and will be characterised by cognitive computing advancements in artiﬁcial intelligence and predictive analytics, and smaller, more powerful and cheaper sensors. These advancements underpin many new innovations, including self-driving cars, robots, virtual reality and connected homes. Shared-value insurance is uniquely positioned to incorporate these technologies, so that new technology is a positive catalyst to, rather than a disruptor of, an established business model. One leading example is the explosion of wearables and smartwatches in the marketplace. Often linked to a smartphone, these devices allow people to passively quantify their health status. With the technologies becoming more personal and predictive, tailored and context-speciﬁc recommendations can be delivered to individuals to facilitate healthy behaviours.
Implications for actuaries Since its inception, insurance has played an important social role through the pooling of resources to protect against uncertainty, from the exchange of information in Edward Lloyd’s coﬀee house to the more specialised and sophisticated varieties of protecting people’s health, life and property. In this tradition, shared-value insurance responds to new challenges with a deﬁnite social purpose. Actuaries have always been at the forefront of industry innovation and are ideally positioned to engineer these products for maximum impact. Already, shared-value insurance has been extended from life and health insurance to short-term insurance, where it promotes and incentivises better driving behaviour; as well as showing promising applications in investments and banking. From an actuarial perspective, shared-value
insurance products are characterised by three key attributes: they promote, track and incentivise positive risk behaviour; capture actuarial surplus from better risk behaviours; and share part of the actuarial surplus with policyholders to incentivise better risk behaviour. Given the combination of these attributes, the model calls for new analytical methods in shared-value insurance, which relate morbidity and mortality outcomes not only to static rating factors but also the relationships between incentives, behaviour, risk outcomes and uplift in economic value (see Figure 1 for a case example). In shared-value insurance, the economic value created per member is a function of the incentive for a member, which is associated with a change in behaviour for the given incentive, which is further associated with an improved risk outcome given the change in behaviour, which is ﬁnally associated with a valuation uplift given the improved risk outcome. This should more than oﬀset the cost of the incentive to reﬂect a ‘sharing’ of surplus between the insurer and the member. Optimal product design and pricing requires that diverse insights from behavioural economics, epidemiology, psychology and actuarial science be brought together in models designed speciﬁcally for shared-value insurance. To enjoy the triumph of longevity and address the cognitive biases that prevent us from making healthy choices, innovative approaches are required that suit 21st-century customer expectations. Shared-value insurance enables this, and presents a tremendous opportunity to the industry to establish a new model that is appropriate to the evolving role of technology in insurance and business in society.
Figure 1: Case example of the mathematics of Vitality shared-value insurance: Vitality active rewards with Apple Watch
Figure 1: Estimates of R0 for pandemic and seasonal inďŹ‚uenza
inﬂuenza agenda Insurers perennially cite a pandemic as one of the major risks they face, but are the industry’s modelling approaches keeping pace with the wider body of available knowledge? Matthew Edwards and Richard Marshall investigate
Live links on our app! p!
It has been a long and widely held belief that the
Prevention and treatment
most plausible pandemic scenario is an inﬂuenza pandemic. This is largely due to the rapid evolution of diﬀerent strains of the inﬂuenza virus and the ease and speed of transmission of certain strains of the virus. Estimates of the transmissibility of diﬀerent strains of inﬂuenza virus vary greatly across populations and studies. The base reproductive number is a measure of the number of new cases that one case of a virus may generate and is denoted ‘R0’. If a virus has an R0 less than one, it will eventually die out, since there will be fewer new cases with each generation of infection. Figure 1 (opposite) shows the medians, interquartile ranges and full ranges of estimates of R0 for the main pandemic strains of the past 100 years, along with those for seasonal inﬂuenza. Note that a few outliers widen the overall ranges signiﬁcantly. The interquartile ranges are a better indication of the spread of the estimates for R0. Historically, pandemic strains have often occurred in at least two waves. The 1918 H1N1, the 1968 H3N2 and the 2009 H1N1 strains all unfolded in this manner. The factors underlying this characteristic are thought to include school holidays and weather conditions, since the inﬂuenza virus has been estimated to have a higher base reproductive number in children than in adults, and humidity is believed to aﬀect how the virus is transmitted. Infection attack rates, base reproductive numbers and wave structures are important in determining the size and timing of the impact of a pandemic on diﬀerent age groups and therefore in quantifying the impact on an insurance portfolio. For this reason, a comprehensive approach to pandemic modelling should allow for single- and double-wave pandemics, age-speciﬁc infection rates and rates of transmission that can vary for treatment status, seasonality and patterns of social contact, in each case parameterised using the latest national statistics and medical data. This approach gives more robust estimates of the eﬀect of a modern pandemic on a particular portfolio.
One of the challenges faced by vaccine developers is ‘antigenic drift’, whereby accumulated mutations in the virus lead to a new virus strain that is impervious to existing treatments. Cell-based and recombinant methods of vaccine production have cut the delay from identiﬁcation of a strain of inﬂuenza to the availability of vaccines for distribution over the past few years. Vaccine eﬃcacy against antigenically matched strains of inﬂuenza virus has been shown to be almost 84%. But while vaccines may provide protection against existing strains, eﬀectiveness against novel strains is materially lower. Some strains of the 2009 H1N1 virus have been observed to be resistant to Tamiﬂu®. In the UK, 45 out of 5,587 viruses tested were resistant, and further resistant cases emerged in the 2010/11 inﬂuenza season. Antigenic drift could cause rates of resistance to increase dramatically, especially when a drug is widely used in response to an outbreak. While the technologies becoming available to ﬁght pandemics show promise, the nature of the inﬂuenza virus is that it presents something of a moving target. A suitable model calibration must devote equal attention to the subjects of virus virulence and spread to those of antiviral eﬀectiveness and response.
UK preparedness for a pandemic The current UK pandemic preparedness strategy was last published in 2011 and proposed that the nation should hold a stockpile of antiviral medicines to treat pandemic inﬂuenza, but not to protect against infection prior to exposure. The ﬁve phases of the UK’s response are shown in Figure 2. The UK’s Scientiﬁc Pandemic Inﬂuenza Advisory Committee has published a ‘reasonable worst case scenario’ for the purpose of emergency planning in the UK. This shows the likely infection rates, peak illness rates, case hospitalisation rates, intensive care requirements and case fatality ratios in the event of a severe December 2016 • THE ACTUARY 31 www.theactuary.com
pandemic inﬂuenza outbreak. The national response to a pandemic is crucial to the progression and impact of a viral strain. The UK’s preparedness plan gives an indication of the range and severity of action that may be taken, and the reasonable worst-case scenario provided by the UK’s advisory committee oﬀers an insight into the parameterisation that might be considered in determining capital requirements.
MATTHEW EDWARDS is
head of mortality and longevity in Willis Towers Watson’s life insurance practice
is senior analyst at Willis Towers Watson
Figure 2: The ﬁve phases of the UK pandemic response programme
Industry approaches The Standard Formula Life Catastrophe risk sub-module speciﬁes a level uplift to mortality rates of 15 basis points applied over a period of 12 months, which gives excess mortality of 1.5 deaths per mille owing to a combination of diﬀerent potential catastrophic events, of which one is a pandemic. This approach, however, poorly represents the actual risks faced by any company with exposure to pandemic risk. This is because it speciﬁes excess deaths per year, not their time distribution. Pandemics can be concentrated within a period of a few weeks and in one or more waves. The Standard Formula approach also assumes excess deaths are distributed evenly across all ages. In reality, certain age groups are aﬀected more than others. The Standard Formula also fails to adequately allow for: ● Operational risks – for example, the eﬀect of a pandemic on absentee rates ● Increases in temporary income protection policy claims ● Changes in policyholder behaviour ● Impacts on non-life products – for example, travel insurance or business interruption insurance ● Eﬀectiveness of reinsurance programmes. As to the overall level of the calibration, the Standard Formula speciﬁes 1.5 deaths per mille across a year, but a variety of models with diﬀerent structures and a range of historical estimates of mortality from previous pandemics suggest excess deaths ranging from 0.1 to 4 per mille based on inﬂuenza alone. As progress is made towards the development of a universal inﬂuenza vaccine, the focus for future pandemic modelling may even shift away from inﬂuenza, so it is important to have an understanding of a wider range of possible pandemic scenarios. Given the threats of emerging resistance to antibiotics, it is not beyond the realms of possibility that bacterial infections – for instance, extensively drugresistant tuberculosis – could be responsible for a future pandemic. Where companies have a signiﬁcant exposure to a wide range of possible risks from pandemics, models need to progress beyond 32
benchmarked calibrations of excess deaths alone in order to determine the impact on a company’s overall portfolio.
Overcoming shortfalls of the Standard Formula For insurers with material pandemic risk, understanding the nature of their exposure requires a more sophisticated internal model approach. The impact on capital might be small, but the information and understanding gained will improve preparedness and allow
For insurers with material pandemic risk, understanding the nature of their exposure requires a more sophisticated internal model approach
more eﬀective risk mitigation approaches to be employed. Typical approaches to pandemic modelling in academia have included SIR models (“Susceptible”, “Infected”, “Recovered”/”Removed”), possibly with additional states for latent infections and complications. Some sophisticated models break with the Markov assumption and allow for time-inhomogeneity in incubation periods and recovery rates. Industry models have generally lagged behind, however; curve ﬁtting and factor-based models (eg severity and lethality) are typical approaches among those known to be modelling pandemic risk at all. To implement eﬀective risk management, insurers should ideally be able to understand the wide range of potential impacts of government policy, social distancing and limitations of healthcare provisions on the outcomes of a pandemic. As well as capturing key viral characteristics (transmission rates, incubation periods, infectious durations and complication rates), models will need to have regard to: ● The availability of, and strain on, medical care ● Time to vaccine production and vaccine eﬃcacy ● The impacts of changes in patterns of travel on geographical spread. It will also be important to understand the sensitivity of the results to changes in the population and health-care assumptions. These insights could come from a sophisticated multi-state approach, building on the strengths of those models from the world of academia. Medical approaches to tackling the threat of pandemics have moved on; modelling of the ensuing insurance risks should do likewise.
THE ACTUARY • December 2016 www.theactuary.com
Sonal Shah is a freelance actuary specialising in documentation
Big Data In Practice: How 45 successful companies used big data analytics to deliver extraordinary results Author: Bernard Marr Publisher: John Wiley & Sons ISBN-10: 1119231388 Price: £29.99
When oﬀered the opportunity to review a book from a few available options for The Actuary magazine, I settled upon this, and it has proved to be an interesting and informative read, covering the topical and fast-moving area of big data analytics. It presents case studies of diverse companies embracing the use of big data analytics, leading to gaining valuable insights that are used to enhance their product and service oﬀerings, with clear beneﬁts for both customers and the companies. Some examples of the beneﬁts of big data mentioned in the book include the provision of more personalised service, performance optimisation, safety enhancement, crime identiﬁcation, and natural disaster prediction. Marr introduces big data as “a movement that will completely transform any part of business and society”. He makes the bold statement that: “I am convinced that big data, unlike any other trend at the moment, will aﬀect everyone, and everything we do.” The case studies are well laid out in the form of narratives of the big data projects undertaken within the studied companies, and Marr has successfully managed to write each case study in a succinct and engaging manner. For each company, he provides background information, outlines the problem that big data helps to solve, explains how big data is used in practice, describes the results of the project, and outlines the data used. In addition, technical details of the platforms and systems used are provided, along with comments on challenges that had to be overcome. Each case study ends with the key learning points and takeaways, and references for further reading. Rather disappointingly, none of the case studies were of companies (such as insurers) that make extensive use of actuarial analysis and are early collectors and users of large
datasets. This absence is not a reﬂection of the lack of diversity in Marr’s selected studies, but it perhaps demonstrates that data analytics is more passionately publicised elsewhere and has progressed so far and fast such that, regrettably, some of the earliest data-centric industries and professions like ours were not considered or did not make the cut for a case study. Could this be a reﬂection of actuaries not being as visible and vocal as we could be in the data science space, which is acutely closely connected with actuarial science? As has been discussed before in this magazine, it may be that other professions market their skill sets better, and there may be a case for us to raise our proﬁle and image. After all, many actuaries and non-actuaries would say our work is pioneering at the heart of the ﬁeld of data science. One wonders whether a diﬀerent compilation on the same theme of the use of big data analytics would acknowledge actuarial work and actuaries’ prolonged penchant for data. Marr points out that improvements in technology and techniques mean that there is
now an increased ability to capture, store and analyse data. Some of the companies he writes about are taking big data very seriously and investing heavily in this area, with machinelearning platforms and large teams of data scientists dedicated to providing analysis that can be translated to meaningful actions, some of which are deployed in real-time. Marr talks about the key data issues connected with privacy and the need to gain customers’ trust, and his narrative highlights companies acknowledging data protection; however, privacy is described as “a murky area in the big data world” and not all companies are transparent about what data they hold. While there is some mention of the danger of placing too much blind faith in data itself, I feel that this point is mentioned too infrequently and does not get the emphasis it deserves. What determines the usefulness of data is not the raw data itself, but rather how it is used and analysed, and the subsequent decisions made. Given that this book is not an academic text, the author has focused on success stories and has not needed to balance these with a set of case studies of failed uses of big data, which would make for an interesting read. Finally, big data analytics necessitates clear communication. It is valuable to be able to articulate technical work to adequately convey the analysis carried out, the insights gained from it, and make recommendations, while also expressing the limitations and judgements applicable to the work. As an actuary working in the actuarial documentation arena, I am very pleased to note that Marr often highlights the importance of communication. He emphasises that “pure number-crunching talent is not always enough... communication ability is also a vital skill”.
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December 2016 • THE ACTUARY 33 www.theactuary.com
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Student Jessica Elkin turns Christmas angel, spreading some seasonal joy to those who would rather say ‘bah humbug’ to Noel
HOW CHRISTMAS STOLE THE GRINCH I’m sure we all know a Scrooge or two when it comes to Christmas. Those awful miseryguts, constantly complaining about how it’s a trick by consumer capitalism to get us spending. Sitting in the corner, arms folded, grumbling about all the usual traditions. They refuse any glad tidings you send their way, they do not partake in goodwill to all men, and they don’t believe in Father Christmas. I bet you know at least one person like this. I have taken it upon myself to re-educate one anti-Christmas actuary – let’s call him the Grinch – this year. It’s a challenge, but I’m up to the task. My love of the season is Herculean in strength and more constant than a ﬂat discount rate. What you have to do is ﬁnd out what they don’t like about the season, avoid that stuﬀ, and expose them to more things in tune with what they do like. This might be as simple as plying them with baked goods shaped like Santa, or jazz renditions of Christmas classics. Maybe they like mulled wine and twinkly lights. In my case, it’ll be Christmas tree chocolates, a good cuppa and a roaring ﬁre. He’s sure to come around. Once you’ve done the groundwork, you must gradually introduce extra things that will slowly ingratiate Christmas with them and melt their ice-cold hearts. On a crisp winter day, ‘accidentally’ happen upon a Christmas market. Alternatively, take a trip to an inviting ice rink. (The latter won’t work for my Grinch. Apparently, he has the grace of a drunk giraﬀe). Gradually, the sheer magic of 34
THE ACTUARY • December 2016 www.theactuary.com
it all will overtake them, and eventually they’ll submit wholly to festive cheer, tears running down their face – like Winston at the end of 1984, if the book had been about the joy of Christmas and not a terrifying dystopian nightmare.
Bittersweet sympathy I went to a talk on soft skills and networking once, where the speaker said: “Don’t treat people how you want to be treated. Treat them how they want to be treated.” The speaker was a bit of a schmoozer, kind of unctuous, someone who may have been a recruiter or estate agent in a former life, but
I’ve always remembered that as a nice bit of wisdom. That’s why I’m convinced that my Christmas machinations will work. You reel them in with the things they like ﬁrst, make them feel at home, then BAM! – whack them with glad tidings. It’s all about empathy, I suppose. Relating to people, understanding what concerns them, adapting to their needs. Empathy is something I can’t help wishing the ‘powers that be’ had more of regarding the holiday season. They love to slip in judgment day as late as possible, enabling us to fret about exams, even while we wrap presents and drink eggnog (one of the most unappealingly named substances there is). This year, the event falls just a few days before Christmas. So it’s certainly going to be on our mind. Rumour has it that your loyal student editor might even become unqualiﬁed for the job, if you get my meaning. So fear not, comrades! I am wringing my hands with the best of you.
Last Christmas It is a little cruel of the IFoA to leave the sword of Damocles hanging above us, however bedecked in holly and mistletoe, until so close to 25 December. I’m guessing you and I might ﬁnd ourselves becoming somewhat Grinchy ourselves should things not go our way. The cure for me, which I can recommend to everyone, is to ensconce oneself further in everything Christmassy. It would be a trial, but nothing can quell my love of Christmas. However, if it doesn’t happen for us, you’ll move on, and I’ll move on. You keep trying, don’t you? I won’t give up on the Grinch until I reach my end goal, which will be to get him into a Christmas jumper. And maybe some tinsel. Dr Seuss thought it possible, so I do too. The main thing is that we’re all in the same boat, and most of us have someone willing to do whatever underhand, sordid activities it takes to manipulate us into happiness. Those people are to be valued, in my opinion. The other thing is to have patience – eventually, in the words of the late great Dr Seuss himself, “will you succeed? Yes! You will, indeed! (98 and three-quarters per cent guaranteed.)” Here’s wishing you the best Christmas and exam results possible, and for the chance of my being ﬁred before the next festive season comes around.
At the back
Coffee break 7
Among the clues for the crossword this month are some festive references Across
22 Railway initially presented together with trademark (5)
Publisher gets axe in call from France (8)
24 Discovery by Queen leads to small price to pay as reward (7,3)
Collapse from apex of pile losing current surplus (6,4)
Waste is contained in deliberate…… (6)
25 Actor standing tall in forest? (4)
….cut covering quarters of sect member (6)
26 Second person (French) trapped in den reﬂected on convention (6)
13 Confused posh element with rudimentary nose (10)
27 Tip of eel grass seen at sea? (8)
16 Gaps ﬂared in heated environment (8)
18 Swindle to get old investment from noblewoman (8)
15 Modest gathering; politician with a new business (7)
Rapid ﬁre upsets animals supported by Roman (8)
19 The old split recycled fuel in butchers? (6)
17 Commencement of court proceedings? (7)
Could be housemaid’s keen to renovate (4)
20, 23, 14 My energy steered long-term development at 11 15 12 17, perhaps (3,4,2,5,9)
Colour ban when argument supercedes answer (5)
Message sent back to switch locks? (4,4)
Hunk taking liqueur during party? No, the opposite (6)
10 Sacred component of port (4) 11 How to propel a boat backwards – a large boat almost brimming with feelings of respect (10) 12 Oral rendition after celebratory opening (5) 14 See 20 Ac
Follow the star Mensa puzzle 671 www.mensa.org.uk Use the letters given to complete the star so that two ﬁve-letter words, one four-letter word and two words of two letters can be read. What are the words?
21 Viola is distressed about one Shakespearean countess (6) 23 See 20 Ac 25 One who secures bank? (4)
Snow fun Mensa puzzle 672
S R K
A E F I I N O R T
What number should replace the question mark?
FOR PUZZLES SOLUTIONS Answers and more can be found online. Please go to www.theactuary.com/puzzles
December 2016 • THE ACTUARY 35 www.theactuary.com
News NEWS UPDATES FROM THE ACTUARIAL
Creating a buzz By Craig Rychlewski
A bouncing barbecue By Dr David Baker The Zurich UK actuarial reserving team hosted a barbecue and fun day at the Royal Victoria Country Park for the KIDS Young Carers Project on 11 August. The day included a bouncy castle, face painting, gladiator batons, board games, rounders and cricket. But by far the most popular activity involved the relentless pursuit of adults with water guns and water cannons. The Fareham and Gosport-based charity supports children who have caring responsibilities for a close family member who has a short- or long-term illness or disability. Zurich managed to fundraise over £2,000 this year for the charity through a mixture of activities, including a Euro 2016 sweepstake, bingo and a dress-down day. David Baker from the actuarial team at Zurich said: “The day was a great success. These events are always very rewarding and seeing the impact is very fulﬁlling. Zurich is committed to supporting our local communities, and we are constantly looking for ways to make a positive diﬀerence.” The Zurich team has already started on plans to carry out a similar charity event next year. Corniche Plumridge from the KIDS Young Carers Project said: “The day was amazing, we are so so grateful for the work that the team at Zurich do for us.”
On Saturday 3 September, 20 bees from the JLT Exeter oﬃce turned up for Force Cancer Charity’s ‘It’s a knockout’ fun day at Topsham Rugby Club. Both teams – ‘The bee’s knees’ and ‘Bee the best’ – were buzzing in anticipation as they lined up against other teams of ﬂamingos, Jedis, superheroes and Ketchup bottles. The day was split into two, with dry games in the morning followed by wet games in the afternoon. The bee’s knees ﬂew into action and took an early lead but were soon caught and overtaken on points by Bee the best. This would be how the teams would sit for the rest of the morning, but, by lunch time, the lead held by Bee the best had been reduced to just four points. The dry games were a series of inﬂatables combined with basketball shooting, blind dragons, jumbo darts and more. Shortly after the lunch break was called, the heavens opened and the JLT bees scattered for cover. Much like honey bees’ inability to ﬂy in the rain, this proved to be the teams’ downfall
throughout the afternoon. As the afternoon began, the already sodden bees began diving through obstacles, transporting jugs of water in a human caterpillar and collecting anything from balls, jokes and puzzle pieces, all the while getting wetter and wetter, struggling to ﬂy on, with their wings limp but heads still held high. Surviving with only scrapes and bruises, the day came to its extremely drenched end. The ultimate sting in our tail was the ﬁnal position of 10th and 12th out of 42 teams, but we were thrilled to have been part of the challenge, which had managed to raise over £15,000. Force is a local cancer charity based in Exeter, which aims to give anybody diagnosed with cancer the best possible treatment and support close to home. Daily they provide physical, emotional psychological and practical support to those in need. For more information, please visit
Cass students win prizes for 2016 By Kyla Njoku Cass Business School is delighted to announce the prize winners of the NMG Consulting prize for actuarial science in 2015-16. Krishna Mepani (left) and Aditya Sanghvi (right), scored the highest marks in the actuarial risk management modules in the last academic year, and will share the £2,000 NMG Consulting prize. This award, judged by Cass academics and sponsored by NMG Consulting, was open to students studying on the MSc in actuarial management. Speaking at the recent prize-giving breakfast, NMG consulting partner David Burns said: 36
“We’d like to congratulate the two winners on their outstanding success in the examinations. NMG greatly values its association with Cass and is delighted to conﬁrm that we will be continuing this in 2017.” Professor Ben Rickayzen, head of the faculty of actuarial science and insurance at Cass, congratulated the two prize winners, saying: “This is a highly sought-after honour, and the competition was strong this year, so well done. I would also like extend my thanks to NMG Consulting, which has sponsored these prizes since 2012. I look forward to our continued relationship.”
THE ACTUARY • December 2016 www.theactuary.com
Gene-eggtics at the autumn livery dinner By Alan Smith The Worshipful Company of Actuaries’ autumn livery dinner was held in the grand and artistic surroundings of Painters’ Hall on 6 October. Master Sally Bridgeland was delighted to introduce 10 new members to the assembled company, and we all enjoyed the customary delicious dinner with ﬁne wine. A particular treat was a private musical interlude, performed by award-winning acoustic guitarist Will McNicol, which took us on a virtuoso musical journey. The music continued with immediatepast Master Thompson back at
the piano to accompany us for the traditional City grace and toasts before the evening’s speeches. Liveryman Ronnie Bowie welcomed the Company’s guests with humour, using Harry Potter language to pay tribute to our “pureblood” guest, the Master Framework Knitter, the ﬁrst Master who is the daughter of two past Livery Company Masters (a Farmer and a Framework Knitter). His theme of genetics ﬁtted the expertise of Sir John Chisholm, executive chair of Genomics England, who spoke with passion about his involvement with the 100,000 Genomes Project.
Master Bridgeland shared her thoughts on life as a lady Master and the social and charitable programme for the Company’s year. Her thank you gift to Sir John and his wife Lady Kitty, echoing the egg-timer emblem of the Livery badges, was personalised egg cups and eggs from her own chickens, as well as a cheque for the Marie Curie cancer care charity from the Company of Actuaries Charitable Trust Fund (CACT). The Master closed proceedings
by touching on the research project that is being sponsored by CACT into the life expectancy of residents of Whiteley Village (one of the oldest charitable retirement communities in the UK). She also took the opportunity to remind everyone about the Charity Masquerade Ball on 8 February at the Globe. Find out more about the Company and forthcoming events at www.actuariescompany.co.uk. Follow us on Twitter:
SAAX: Brexit panel discussion
Pooling our talent
By Richard Cohen
By Kateryna Katyukha
On Friday 14 October, the Southern African Actuarial ConneXion Group (SAAX), a member interest group of the IFoA, held a panel discussion at Staple Inn. The group was joined by Adam Levitt (Ashurst), Paul Brett (MetLife), and Dick Rae (BMO Global Asset Management), and was expertly moderated by Chris Cundy (InsuranceERM). The event was sponsored by Muller Beukes Edvardsen (MBE).
The SIAS pool tournament took place on 20 October, with 23 teams competing for the top prize. The teams were divided into eight groups of three or two teams. The best from each of the groups proceeded to the knockout tournament. The standard of pool skills is very high in the actuarial profession, and the top three teams were: ﬁrst place – Paul Murphy and Eddy Martin; second place – Dara Fahy and Patrice Gluck; and third place – Greg Ip and Nishan de Silva. Congratulations to them. After the tournament, the players carried on playing and drinking into the night. Many discussions were heard on how it could have been diﬀerent if only their partner had potted an easy ball. We hope that you all had an enjoyable evening and look forward to seeing you next year for a re-match.
Hard Brexit It was the consensus that the UK was heading toward a ‘hard’ Brexit, which would be likely to result in limited access to the single market. Alternative model EU trade agreements do exist, although each of these has its own pros and cons and requires time to negotiate – a luxury the UK might not necessarily have – with each being focused on goods rather than services.
Market uncertainty and passporting A hot topic in the ﬁnancial services industry is around the implications of Brexit on
passporting. One should consider not only current arrangements but also the opportunity cost of lost future endeavours. What is clear is the immediate impact Brexit has had on the ﬁnancial markets and the value of the GBP. This could result in an extended period of low growth, including low interest rates. The real threat remains the impact of inertia and the loss of investments in the short and medium term.
Opportunities It was made clear that Brexit may also provide some opportunities to the ﬁnancial services markets, including the prospect for the UK to review Solvency II capital requirements and
methodology. It was made clear that equivalence does not necessarily mean exactly equal, and that the UK could maintain a level of proportionate response in establishing this. Other opportunities discussed include the ability of the UK to negotiate individual trade deals with foreign countries, which might be better than those attained by the EU, although this depends on whether one thinks the EU has a stronger or weaker bargaining position. Other areas of consideration would be around data protection, freedom of movement of people, including both skilled and unskilled, and EU laws.
We would be delighted to hear from you if you have any newsworthy items for these pages. Please contact Yvonne Wan at firstname.lastname@example.org
December 2016 • THE ACTUARY 37 www.theactuary.com
Moves Punter Southall has named Colette Christiansen (above) as head of de-risking solutions. She had previously held this role between 2014 and February 2016, and now returns after a six-month stint at Scottish Widows, where she was head of propositions for bulk annuities. Christiansen was also chairman’s fellow and a senior consultant for Towers Watson between 2010 and 2014. Prior to that, she was a partner at the Pension Corporation.
Hymans Robertson has appointed Beenesh Googoolye to its investment consulting practice. A senior investment consultant at LCP since 2007, Googoolye will focus on developing existing client relationships and new deﬁned beneﬁt business as a senior investment consultant. He was previously a performance and risk analyst at Capital Group.
for the day-to-day running of the company. Cuﬀ was partner and head of the London pensions team at KPMG. Jo Kite (below) has been appointed managing director of LifeSight UK, taking over from Fiona Matthews, who will become global head of LifeSight; Willis Towers Watson’s deﬁned contribution master trust
Paul Cuﬀ has been appointed Xaﬁnity managing director. Cuﬀ, who joins from KPMG, is responsible for the consultancy’s marketing and sales eﬀorts. He shares the role with existing managing director Ben Bramhall, who is now responsible
business. With 20 years’ leadership experience in the pensions and insurance industry, Kite has led Willis Towers Watson’s business in Scotland since she joined in 2014. Prior to this, she ran a leading provider’s workplace pensions and savings programme. Willis Towers Watson has promoted Sara Rejal and Karen Dolenec to two newly created positions. Both previously senior investment consultants, Rejal is now head of liquid alternatives, while Dolenec is head of real assets. Willis Towers Watson has also
appointed Colin Forrest (above) to lead its life team in the UK. Forrest has over 25 years of industry experience and joins from Deloitte, where he most recently was the partner leading the ﬁrm’s Swiss actuarial practice in Zurich. Previously, he was a director in the actuarial and insurance management solutions practice at PwC, as well as holding a variety of senior
ACTUARY OF THE FUTURE
Employer and area of work
What’s your most ‘actuarial’ habit?
Greatest risk you have ever taken?
PwC, reward and employment.
There is a calculator in my bag at all times.
How would your best friend describe you?
I put Mahrez and Vardy on my fantasy football team from the start of last season.
Favourite Excel function?
“Good collection of jumpers and has an unwillingness to get higher prescription glasses. It’s frustrating because she often can’t see.” – Best friend; “Meh.” – Buddy/former actuary of the future.
What motivates you? Fear of failure.
What would be your personal nal motto? ‘You know nothing, Jon Snow’. now’.
Name ﬁve dream companions ons to be stuck on a desert island with? Jon Snow, Selasi from ‘Bake ke Oﬀ ﬀ’ to cook food for everyone, Tommy mmy Shelby (from Peaky Blinders) rs) for protection, and actors Richard hard Ayoade and Danny DeVito..
roles at Royal Liver and Guardian Royal Exchange/Aegon. Willis Towers Watson has also announced that Chris Massey (above) will join its UK consultancy team as a senior strategic adviser, based in Edinburgh. Joining from PwC, where he was a partner, Massey spent 12 years with the ﬁrm in a variety of strategic consulting roles.
How do you relax away from the oﬃce? Seeing friends, going for drinks, watching series and I once went to the gym.
What is the funniest thing thin that has recently? happened to you rece A senior member of the team c recently made me climb into a McDo bush outside McDonald’s.
Alternative career cchoice?
If you could go back in history, who would you like to meet? Alan Turing.
If there was a movie produced about your life, who would play you, and why? Jennifer Saunders as my name is often mistaken for hers, which causes people to be disappointed when I show up to things instead of her.
If you could be anyone else, who would it be? Mary Berry.
Captain of a boat.
What song be best describes your wor work ethic? 7 dayss – Crai Craig David.
Do you know an actuary destined for greatness? You can nominate an Actuary of the Future by emailing
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Â‡Â…ÂŠÂ?Â‹Â…ÂƒÂŽÂ…Â–Â—ÂƒÂ”Â‹ÂƒÂŽÂ?ÂƒÂŽÂ›Â•Â–ÇŚ Â‰ÂŽÂ‘Â‘ Í‹ÍœÍ˜Â?ÇŚÍ‹ÍžÍ?Â?ÇĄÂ‘Â?Â†Â‘Â?
We have an opportunity for a validation actuary/analyst within one of the UKâ€™s largest specialist insurers. The role reports into the risk manager and involves working alongside other risk specialists who help assess all parts of the internal model. You will be responsible for leading the validation work and with time will grow with the role. For more information please contact: firstname.lastname@example.org REF: DC1203
Our client, a leading Lloydâ€™s insurer are looking to hire an actuarial ÂƒÂ?ÂƒÂŽÂ›Â•Â–Ç¤ ÂŠÂ‡ Â”Â‘ÂŽÂ‡ Â™Â‹ÂŽÂŽ Â™Â‘Â”Â? Â…ÂŽÂ‘Â•Â‡ÂŽÂ› Â™Â‹Â–ÂŠ Â•Â‡Â?Â‹Â‘Â” Â…Â‘Â?Â’ÂƒÂ?Â› Ć¤Â‰Â—Â”Â‡Â• Â–Â‘ improve and develop the current reserving and capital processes. Prior working knowledge of Igloo and good SQL coding skills are highly desired. For more information please contact: email@example.com REF: PF1201
We are helping our client with a number of niche actuarial hires. You should ideally have prior experience of capital and reserving processes within either the London market or the personal lines space in the UK. This role requires a very strong communicator, good organisational Â•Â?Â‹ÂŽÂŽÂ•ÇĄÂƒÂ?Â†ÂƒÂ? Â‘Â”Â‡Â“Â—Â‹Â˜ÂƒÂŽÂ‡Â?Â–Â“Â—ÂƒÂŽÂ‹Ć¤Â…ÂƒÂ–Â‹Â‘Â?Ç¤ For more information please contact: firstname.lastname@example.org REF: PF1202
This growing personal and commercial lines insurer are looking to hire a manager to lead the actuarial team. The current team comprises Âƒ Â?Â—Â?Â„Â‡Â” Â‘Âˆ Â?Â‡ÂƒÂ”ÂŽÂ› Â“Â—ÂƒÂŽÂ‹Ć¤Â‡Â† ÂƒÂ…Â–Â—ÂƒÂ”Â‹Â‡Â• Â•Â‘ Â›Â‘Â— Â™Â‹ÂŽÂŽ Â„Â‡ Â…Â‘Â?Ć¤Â†Â‡Â?Â– Â‹Â? delegating work and developing their capabilities. You should have previous managerial experience to be suitable for this role. For more information please contact: email@example.com REF: PF1203
Í‹Í™Í˜Í˜Í˜ÇŚÍ‹Í™ÍšÍ˜Í˜Â’Â‡Â”Â†ÂƒÂ›ÇĄ Â‘Â—Â–ÂŠÂ‡Â•Â– My client is urgently looking for an expert Igloo contractor to help support the IMAP and deliver the submissions. S2 experience would be desirable and to be considered you must be an Igloo expert and immediately available For more information please contact: firstname.lastname@example.org REF: RP1201
Í‹Í Í˜Í˜ÇŚÍ‹Í™Í˜Í˜Í˜Â’Â‡Â”Â†ÂƒÂ›ÇĄ Â‘Â?Â†Â‘Â? This leading LMKT insurer is looking for a strong reserving actuary, with a wealth of Lloydâ€™s/LMK experience. You will be responsible for developing the technical provisions under S2, as well as taking responsibility for the reserving process. You must be comfortable being Â…ÂŠÂƒÂŽÂŽÂ‡Â?Â‰Â‡Â†ÂƒÂ?Â†Â„Â‡Â…Â‘Â?Ć¤Â†Â‡Â?Â–Â™ÂŠÂ‡Â?Â†Â‡ÂƒÂŽÂ‹Â?Â‰Â™Â‹Â–ÂŠÂ•Â‡Â?Â‹Â‘Â”Â•Â–ÂƒÂ?Â‡ÂŠÂ‘ÂŽÂ†Â‡Â”Â•Ç¤ For more information please contact: email@example.com REF: RP1202
+44 (0) 207 337 8800
Â™Â™Â™Ç¤ÂŠÂˆÂ‰Ç¤Â…Â‘Ç¤Â—Â? December 2016 â€˘ THE ACTUARY 39 www.theactuary.com
ACT Rec Dec16.indd 39
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ACT Rec Dec16.indd 40
London : Chicago : Hong Kong : Singapore : Shanghai : Zurich
Syndicate Actuary Up to £140, 000 Base Salary + Bonus & Generous Pension
– City of London
dŚŝƐŝƐĂƵŶŝƋƵĞŽƉƉŽƌƚƵŶŝƚǇƚŽďĞƚŚĞĮƌƐƚĂƉƉŽŝŶƚĞĚĂĐƚƵĂƌǇĨŽƌĂŶĞǁƐƚĂƌƚͲƵƉƐǇŶĚŝĐĂƚĞ͘/ŚĂǀĞƚŚŝƐŽŶĂƌĞƚĂŝŶĞĚ ƐĞĂƌĐŚďĂƐŝƐ͕ƐŽĐƵƌƌĞŶƚůǇƉƵƫŶŐĂƐŚŽƌƚůŝƐƚƚŽŐĞƚŚĞƌŽĨƉƌŽƐƉĞĐƟǀĞĐĂŶĚŝĚĂƚĞƐƚŽƐƉĞĂŬƚŽ͘DǇĐůŝĞŶƚŝƐůŽŽŬŝŶŐĨŽƌ ĂŶĞǁůǇƋƵĂůŝĮĞĚĂĐƚƵĂƌǇƵƉǁĂƌĚƐǁŝƚŚĂƚůĞĂƐƚϱǇĞĂƌ>ůŽǇĚ͛Ɛͬ>ŽŶĚŽŶDĂƌŬĞƚĞǆƉĞƌŝĞŶĐĞƚŽĚŽĂŚĂŶĚƐͲŽŶƉƌŝĐŝŶŐͬ ƌĞƐĞƌǀŝŶŐƌŽůĞƚŽďĞŐŝŶǁŝƚŚǁŽƌŬŝŶŐǀĞƌǇĐůŽƐĞůǇƚŽĂŶƵŵďĞƌŽĨĞƐƚĂďůŝƐŚĞĚĂŶĚǁĞůůƌĞŐĂƌĚĞĚƵŶĚĞƌǁƌŝƚĞƌƐ͘
Contact: firstname.lastname@example.org Tel: +44 207 481 8686 ϯDŽŶƚŚWƌŝĐŝŶŐĂǇZĂƚĞŽŶƚƌĂĐƟŶŐƌŽůĞ Up to £650 a day
– City of London
ϯ ŵŽŶƚŚ ĚĂǇ ƌĂƚĞ ĐŽŶƚƌĂĐƟŶŐ ŽƉƉŽƌƚƵŶŝƚǇ ǁŝƚŚ Ă ůŝŬĞůǇ ƉŽƐƐŝďŝůŝƚǇ ĨŽƌ ĞǆƚĞŶƐŝŽŶ͘ >ŽŽŬŝŶŐ ĨŽƌ ĂŶ ŝŶĚŝǀŝĚƵĂůǁŚŽŝƐĂƉĂƌƚͲƋƵĂůŝĮĞĚĂĐƚƵĂƌǇŽƌŶŽƚƉƵƌƐƵŝŶŐĞǆĂŵƐ͕ǁŚŽŚĂƐƐƚƌŽŶŐƉƌŝĐŝŶŐŵŽĚĞůůŝŶŐ ƐŬŝůůƐĨƌŽŵĂƉĞƌƐŽŶĂůůŝŶĞƐŽƌĐŽŵŵĞƌĐŝĂůůŝŶĞƐďĂĐŬŐƌŽƵŶĚĂŶĚŚĂƐƐŽůŝĚ^^ƐŬŝůůƐ͘
Contact: email@example.com Tel: +44 207 481 8686 ^ǇŶĚŝĐĂƚĞ,ĞĂĚŽĨZĞƐĞƌǀŝŶŐWŽƐŝƟŽŶ άϭϰϬ͕ϬϬϬĂƐĞнŽŶƵƐΘĞŶĞĮƚƐ
'ƌŽǁŝŶŐ>ůŽǇĚ͛ƐƐǇŶĚŝĐĂƚĞŝƐůŽŽŬŝŶŐĨŽƌĂŶ&/ƚŽŚĞĂĚĂƌĞƐĞƌǀŝŶŐĨƵŶĐƟŽŶǁŝƚŚƉƌŽǀĞŶŵĂŶĂŐĞƌŝĂů ƐŬŝůůƐ͕ƉƌĂŐŵĂƟĐĂŶĚŚĂƐƐŽůŝĚďƵƐŝŶĞƐƐĂĐƵŵĞŶ͘ŽƵůĚďĞƐƵŝƚĞĚĨŽƌĂŝŐϰĐŽŶƐƵůƚĂŶĐǇĂĐƚƵĂƌǇŽƌ ĂŶŝŶĚŝǀŝĚƵĂůǁŚŽŝƐǁŽƌŬŝŶŐǁŝƚŚŝŶĂůĂƌŐĞŝŶƐƵƌĂŶĐĞĐĂƌƌŝĞƌǁŚŽŝƐůŽŽŬŝŶŐĨŽƌĂƐŵĂůůĞƌďƵƚŵŽƌĞ ĞŶƚƌĞƉƌĞŶĞƵƌŝĂůĞŶǀŝƌŽŶŵĞŶƚ͘
Contact: firstname.lastname@example.org Tel: +44 207 481 8686 Pricing/Mixed Actuary- Lloyd’s Syndicate £75,000 - £100, 000 Base + Bonus & Package
– City of London
DǇ ĐůŝĞŶƚ ŚĂƐ ŐŝǀĞŶ ŵĞ Ă ƉŽƐŝƟŽŶ ŽŶ Ă ƌĞƚĂŝŶĞĚ ƐĞĂƌĐŚ ďĂƐŝƐ ƚŽ ĮŶĚ Ă ƐŽŽŶ ƚŽ ďĞ Žƌ ƋƵĂůŝĮĞĚ ĂĐƚƵĂƌǇǁŚŽĐĂŶǁŽƌŬĂƵƚŽŶŽŵŽƵƐůǇ͕ƚŽƐŝƚŝŶĂŐƌŽǁŝŶŐƵŶĚĞƌǁƌŝƟŶŐĨƵŶĐƟŽŶĂŶĚďĞĂŵĂŝŶƉŽŝŶƚ ŽĨĐŽŶƚĂĐƚĨŽƌĂůůƉƌŝĐŝŶŐĂĐƚƵĂƌŝĂůƌĞƐƉŽŶƐŝďŝůŝƟĞƐ͘ƐƚŚŝƐĂŶĂůǇƟĐƐĨƵŶĐƟŽŶŐƌŽǁƐ͕ƚŚĞƌĞǁŝůůďĞ ĞǆƉŽƐƵƌĞƚŽŐĞƚŝŶǀŽůǀĞĚŝŶƌĞƐĞƌǀŝŶŐĂŶĚĐĂƉŝƚĂůĂŶĚĂůƐŽƚŚĞŽƉƉŽƌƚƵŶŝƚǇƚŽŐƌŽǁĂƚĞĂŵ͘
Contact: email@example.com Tel: +44 207 481 8686
>ŽŶĚŽŶKĸĐĞ͗/W^'ƌŽƵƉ͕ĞǀŝƐDĂƌŬƐ,ŽƵƐĞ͕ϮϰĞǀŝƐDĂƌŬƐ͕>ŽŶĚŽŶϯϳ: Telephone:нϰϰϮϬϳϰϴϭϴϭϭϭ ŵĂŝů͗ĂĐƚƵĂƌŝĂůΛŝƉƐŐƌŽƵƉ͘ĐŽ͘ƵŬ tĞďƐŝƚĞ͗ŚƩƉ͗ͬͬǁǁǁ͘ŝƉƐŐƌŽƵƉ͘ĐŽ͘ƵŬ dǁŝƩĞƌ͗Λ/W^'ƌŽƵƉh< >ŝŶŬĞĚŝŶ͗/W^'ƌŽƵƉ ACT Rec Dec16.indd 41
December 2016 • THE ACTUARY 41 www.theactuary.com
CATALIN LEONARD POPA Catalin joins us to establish our presence as actuarial recruitment specialists across Europe.
SENIOR LIFE ACTUARY, SWITZERLAND
SENIOR NON-LIFE PRICING ACTUARY, GERMANY
Excellent opportunity to join a global insurer as a member of their global team. To be considered for this position you need to have experience of SST, M&A, ESG, internal model, risk modelling and strong IT skills. Good communication and analytical skills and an ability to develop innovative solutions are also essential.
One of the world’s largest reinsurance companies is looking for a non-life actuary to join their pricing team. In this role, you will provide actuarial support for pricing, risk assessment and will develop actuarial assumptions and will support further development of pricing tools. If you are more experienced, opportunity to train junior staff exists.
For more information please visit our website at www.fenassociates.com
For more information please visit our website at www.fenassociates.com
+44 (0)20 7256 9777 |
FOLLOW US ON LINKEDIN
Specialising in High Performance Selection ACTUARIAL ANALYST Up to £35,000 Kent Opportunity for a CT based student to contribute to the success of this small actuarial team by being responsible for the production of a wide range of reporting metrics using actuarial software. Ideally experience of model set-up/runs and model development, attention to detail. Role has full study support with bonus and beneﬁts.
For more information please contact Clinton on 0207 621 3771 or firstname.lastname@example.org
ASSISTANT ACTUARY (WITH PROFITS) £60,000 - £90,000 North London M25
HEAD OF WITH PROFITS Salary very competitive plus bonus and beneﬁts Edinburgh
Seeking an actuary between newly qualiﬁed to 5 years PQE to ultimately become the right hand person to the Head of Valuation and Reporting.
Well known ﬁnancial services group currently has a high proﬁle requirement for a Head of With Proﬁts to report directly to Group Chief Actuary.
The Head of With Proﬁts will lead in the management of with-proﬁts business, providing advice direct to the With-Proﬁts Committee, Chief Actuary and Board and Great opportunity for career development to fulﬁl all requirements of the PRA /FCA and leadership. SIMR function. Ideally valuation / ﬁnancial reporting / Solvency II background including with proﬁts experience.
For more information please contact Clinton on 0207 621 3771 or email@example.com
For more information please contact Lloyd on 0207 621 3758 or firstname.lastname@example.org
KNOCK KNOCK … Who is there? OPPORTUNITIES KNOCKING!! Darwin Rhodes have various opportunities across all levels… If you are seeking a new opportunity in the New Year please contact a member of our team
THE ACTUARY • December 2016 www.theactuary.com
ACT Rec Dec16.indd 42
www.theactuaryjobs.com Life ή͜͜ȋ͘Ȍ͚͙͛͛͘͘͟͟͠͠ ̻Ǥ Ǥ
ή͜͜ȋ͘Ȍ͚͚͚͙͙͛͘͘͘͟ Ǥ̻Ǥ Ǥ
GI Perm ή͜͜ȋ͘Ȍ͚͙͚͙͛͛͘͘͟͟ ̻Ǥ Ǥ
Ƭ ή͜͜ȋ͘Ȍ͚͙͚͛͛͛͘͘͟͟ Ǥ̻Ǥ Ǥ
Life, Investment & Pensions roles Investment Actuary
£60k - £80k basic, Edinburgh Ƥ ȀȀ Ǥ Ƥ Ǥ Ǥ ǣ̻Ǥ Ǥ ǣ͙͚͙͘
£55k - £75k basic, London/Edinburgh Ǥ Ǥ Ǥ ȀƤ Ǥ ǣ̻Ǥ Ǥ ǣ͙͚͚͘
£30k - £40k basic, London ͙ Ǧ ͚ Ǥ ǡ
ơ Ǥ ǣ̻Ǥ Ǥ ǣ͙͚͛͘
Senior Reporting Actuary
Life Actuarial Analyst
Manager / Senior Manager
£50k - £70k basic, London
͜ Ǥ ơ Ƥ Ǥ ǡ Ǥ ǣ̻Ǥ Ǥ ǣ͙͚͘͝
Capital Optimisation Actuary
£70k - £100k basic, Cirencester
͙͘͘ Ƥ Ƥ Ǥ Ƥ ǡ ǡ Ǥ ǣ̻Ǥ Ǥ ǣ͙͚͘͜
£35k - £50k basic, Birmingham Ǥ Ȁ Ǥ ȋǡǦȌǤ ǣ̻Ǥ Ǥ ǣ͙͙͘͞
Actuarial Technician - Product Review
£65k - £95k, London Ǥ ͙ Ǥ Ǥ ǣǤ̻Ǥ Ǥ ǣ ͙͚͘͜
£25k - £40k basic, London Ƥ Ǥơ ǯǤ Ǥ ǣ̻Ǥ Ǥ ǣ͙͚͘͜
Underwriting Risk Analyst
£100k + bonus, London Ǧ Ǧ Ǥ Ǥ ǣǤ̻Ǥ Ǥ ǣ͙͚͙͘
Lead Data Scientist
£70k + bonus, London ǡ Ƥ ǡ ǡ ǡ ǡ Ǥ ǡ ǡ Ǥ ǣǤ̻Ǥ Ǥ ǣ͙͚͛͘
+44 (0) 207 337 8800 ACT Rec Dec16.indd 43
£130k + bonus, London ȋǡ ǡ ǡ ƤȌ Ǧ Ǥ͙͘ ǡ Ǥ ǣǤ̻Ǥ Ǥ ǣ͙͚͚͘
Head of Analytics EMEA
£70k + bonus, London ǫ Ȁǫ Ǧ ǫ ͙͘͘Ƥ ǡ Ǧ Ǥ ǣǤ̻Ǥ Ǥ ǣ͙͚͘͜
Actuarial Data Scientist
December 2016 • THE ACTUARY 43 www.theactuary.com
www.hfg.co.uk 21/11/2016 16:16
PENSIONS & INVESTMENTS NON-LIFE LIFE & HEALTH NEARLY/NEWLY QUALIFIED ACTUARY, London, £80k-£90K
PRODUCTS ACTUARY & SENIOR PRODUCTS ACTUARY
A growing Lloyd's syndicate are currently seeking a nearly/newly qualiﬁed actuary to join their growing team and work within a mixed role. Reporting directly into the Chief Actuary, the role will be responsible for capital modelling, pricing and reserving across their multi-line portfolio. Candidates will need to have strong London market experience, ideally with mixed backgrounds. All skillsets will be considered however those with exposure to capital modelling would be highly desirable. Igloo modelling skills would be beneﬁcial.
A leading global life insurer are recruiting for a Products Actuary and a Senior Products Actuary to join their team on a permanent basis. The roles will involve the development and maintenance of costing tools and models as well as assessing and validating new deals. This is an exciting role working for a new business unit and as such you will have a chance to develop the direction of the product pricing. The position offers a highly competitive salary, bonus and an outstanding beneﬁts package. You will be a qualiﬁed actuary with signiﬁcant work experience in life costing/pricing.
Contact: email@example.com | 0207 092 3239
Eames listed as the #1 insurance recruitment & search ﬁrm in the UK in Recruitment International’s Top 500 Report
Contact: firstname.lastname@example.org | 0207 092 3289
CLAIMS ACTUARY, South East, £100k + beneﬁts
INVESTMENT PARTNER, UK Wide
A non-traditional actuarial role within an award winning personal and commercial lines insurer. Leading an international team, this role will provide insight and analysis in regards to claims activity. Looking for someone who can be creative and take this area to the next level. Areas of work could be fraud analysis, text mining and claims inﬂation; but also to come up with other ideas. Applicants must be experienced within the GI market and have dealt with senior stakeholders.
Our client is a provider of investment consulting services to major pensions schemes. In response recent growth, the business has created a new role that will sit on the UK leadership team. We are seeking innovative and commercial senior investment professionals with experience advising UK pension schemes from £500m aum to £bn aum. The role will be a key ﬁgure within the business and instrumental in developing proposition and building new business.
Contact: email@example.com | 0207 092 3287
Contact: firstname.lastname@example.org | 0207 092 3232
If you are looking for your next career move or to discuss other opportunities, get in touch with us today for a conﬁdential discussion. Contact: email@example.com | 0207 092 3200
London | Zurich | Singapore | Hong Kong
Jason Sykes Managing Director EA Reg: R1333193 +65 6829 7154 firstname.lastname@example.org
Tong Yu Life Actuarial & Risk +44 (0) 207 337 8853 email@example.com
Shuyu Lim GI Actuarial EA Reg: R1433780 +65 6829 7153 firstname.lastname@example.org
Christina Chua Life Actuarial EA Reg: R1546910 +65 6829 7158 email@example.com
APAC Actuarial Assignments SGD$150k - SGD$160k, Singapore
A multinational reinsurer is looking for a seasoned pricing actuary to join their SEA regional team. This role is responsible for client pricing quotations, developing pricing bases, product development initiatives Ǥ Ƥ ͙ ǯ Ǥ Should you be interested, please contact: firstname.lastname@example.org REF:JS1201
$Competitive salary, Singapore
Ǧ / portfolio management / reinsurance experience to sit in their regional team. The incumbent should be specialised in either motor or critical illness exposure across the APAC region. Ideally, he / she should have at least four years of relevant Ǥ Should you be interested, please contact: email@example.com REF:SL1201
Life Actuaries relocating to Thailand
USD$60k basic, Thailand
SGD$160k - SGD$180k, Singapore
of its North Asian operations. As a pricing director, you are responsible for ǡ technical trouble-shooter on pricing guidelines and methodologies. Candidates ͙͘Ǧ͙͚ Ǥ Should you be interested, please contact firstname.lastname@example.org REF: JS1202
$Competitive salary, Singapore / Malaysia
A global reinsurer is expanding its analytics team in the SEA region and is seeking ǯ Ǥ ǡ Ǥ Ǥ Should you be interested, please contact email@example.com REF:CC1202
Chief Valuation Experience
USD$110k basic, Indonesia
I am running several vacancies (assistant manager - head of department level) in Ǥ ȀȀ of the fastest developing markets in Asia please do not hesitate to get in contact. A-PAC market experience is desirable. For more information please contact firstname.lastname@example.org REF: TY1201
A global life insurer is urgently seeking an experienced life actuary to join their
ƥ Ǥ strong actuarial valuation / reporting background and excellent communication ǡ Ǥ Ƥ ǡ Ƥ Ǥ For more information please contact email@example.com REF: TY1202
EA Licence Number: 14C7034
www.hfg.com.sg | +65 6829 7153
THE ACTUARY • December 2016 www.theactuary.com
ACT Rec Dec16.indd 44
School of Mathematical Sciences
Professor of Actuarial Science Reference: QMUL9951 About us
The School and Athena SWAN Charter for Women in Science
Queen Mary is one of London and the UK’s leading research-focused universities and a member of the Russell Group. With over 20,000 students, it is amongst the largest of the colleges of the University of London. Queen Mary’s 4,000 staff teach and research across a wide range of subjects in Science and Engineering, the Humanities, Social Sciences and Laws, and Medicine and Dentistry.
The School holds a departmental Bronze Athena SWAN Award and is a registered supporter of the LMS Good Practice scheme. We are committed to the equality of opportunities and to advancing women’s careers. We have policies to support staff returning from long-term absence, for ﬂexible arrangements for staff with parental responsibilities and for child-care support for the attendance of conferences. As part of the School’s commitment to the Athena SWAN and the LMS Good Practice principles we strongly encourage applications from women.
The School has large and popular undergraduate and graduate programmes. In 2016/17 academic year, the School introduced a new BSc Mathematics with Actuarial Science programme. This is part of the School’s strategy to further extend its expertise in actuarial and ﬁnancial mathematics, and expand the portfolio of modules and taught programmes in this area. The School of Mathematical Sciences has an exceptionally strong research presence across the spectrum of areas within Pure and Applied Mathematics, and is currently organised into six research groups, namely: Algebra, Combinatorics, Complex Systems and Networks, Dynamical Systems and Statistical Physics, Geometry and Analysis, and Probability and Applications.
About the role Applications are invited for a Professor of Actuarial Science to lead the future development of the actuarial undergraduate and postgraduate programmes. The successful candidate will lead on the development of the School’s portfolio of taught modules and programmes in actuarial science. S/he will have teaching experience appropriate to the level of appointment and extensive industrial experience relevant to actuarial science. The successful candidate will be expected to have the knowledge and ability to teach across a range of topics in actuarial mathematics. S/he will also be expected to develop links with industry to foster research and work experience opportunities for students (including a placement programme for actuarial students). The successful candidate will have a track record of actuarial research, the ability to attract funding for future research and an interest in exploring opportunities to work with academics from the School of Mathematical Sciences and other faculties at QMUL.
Please visit www.maths.qmul.ac.uk for information about the School and www.maths. qmul.ac.uk/equality/athena-swan for our family friendly policies and parental leave.
Pay & Beneﬁts The post is full-time and permanent. Starting salary will be negotiable. Beneﬁts include 30 days annual leave, childcare vouchers scheme, deﬁned beneﬁt pension scheme and interest free season ticket loan. The successful candidate will be expected to start the post on September 1, 2017, or as soon as possible thereafter. Candidates must be able to demonstrate their eligibility to work in the UK in accordance with the Immigration, Asylum and Nationality Act 2006. Where required this may include entry clearance or continued leave to remain under the Points Based Immigration Scheme. Further information Informal enquiries may be made to Professor Thomas Prellberg (firstname.lastname@example.org) To apply, please visit the Human Resources website on www.jobs.qmul.ac.uk and search for reference QMUL9951. Please ensure you include with your application a curriculum vitae, a list of publications, a teaching statement and a research statement. The closing date for applications is Wednesday 4 January 2017. Interviews are expected to be held shortly afterwards.
Valuing Diversity & Committed to Equality
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December 2016 • THE ACTUARY 45 www.theactuary.com
ACT Rec Dec16.indd 45
2nd Floor, 32 Cornhill, London, EC3V 3SG | 0207 332 5870 | email@example.com www.mansionhouse.co.uk
NON-LIF E NEARLY QUALIFIED ACTUARY – MIXED ROLE Up to £75,000 + bonus + beneƓts LONDON
NEARLY QUALIFIED PRICING ACTUARY c£70,000 + bonus + beneƓts LONDON
Excellent opportunity for a nearly or newly QualiƂed GI Actuary to join a highly regarded team in the Lloyd’s market. Working closely with the Chief Actuary and key stakeholders, the role will be varied covering reserving and capital modelling across all Syndicates. As a more senior member of the team you will be expected to lead less experienced members of staff on pieces of work and ad-hoc projects, therefore you must be a strong team player, in possession of good communication skills with evidence of prior stakeholder management. A desire to share technical expertise as well as the desire to move into more of a management focused role would be very attractive for my client. Excellent potential for career progression. Ref: pw25428
Senior Pricing Analyst required for a leading Specialty lines insurer. Working closely with underwriters, you will assist in developing and maintaining pricing tools and methodologies as well as assisting with technical pricing across multi lines. To be considered you must have a minimum of 3 years London Market pricing experience, be a competent user of Excel, VBA & SQL and be close to attaining your FIA designation. First rate communication skills are of the utmost importance as the successful candidate will work closely with key stakeholders across Europe and the US building rapport and gaining buy in within short time frames. As a result candidates with consultancy experience are encouraged to apply. Ref: pw25644
RISK MANAGER c£100,000 + bonus + beneƓts LONDON
SENIOR RISK ANALYST £75,000 – 85,000 + bonus + bens CITY OF LONDON
A leading insurance group is looking for a Risk Manager to work closely with the CRO, acting as the ‘go to person’ for the team and mentoring more junior staff members. Work will include Solvency II implementation, ORSA reporting, internal modelling and implementing risk management frameworks. To be considered you must; have a demonstrable track record of ERM within the Lloyd’s market; be highly analytical and educated to degree level with an appropriate risk qualiƂcation; possess a solid understanding of Solvency II, stress testing and risk modelling; be a strong communicator with equally strong technical and soft skills. Ref: dbw25628
A leading Lloyd’s syndicate is looking for a Risk professional to join the ERM team. This is a rare opportunity for a part qualiƂ ed actuary with a Capital background interested in moving over to the Risk space; to lead on the design and development of quantitative MI, as well as validations for the internal model. Communication is key as this person will be the bridge between the Capital and Risk teams. Ref: sy25347
P E NSIONS & I N VES T MEN T S INVESTMENT ANALYST Up to £55,000 + bonus + beneƓts SURREY
ACTUARIAL ANALYST c£35,000 + bonus + beneƓts ESSEX
Exciting opportunity for a bright and ambitious Investment Analyst to re-focus their career within a leading general insurer. Supporting the Head of Investments, work will include the production of monthly investment reports, contributing to Solvency II reporting requirements, assisting with investment strategy, analysing performance of new and existing fund managers and managing relationships. It is imperative that candidates are both technical yet commercially focused with strong communication skills. You will be making good progress with your CFA qualiƂcation with demonstrable experience of working in an analytical role within the Ƃnancial and/or insurance markets and be experienced at relaying technical concepts to a non-technical audience. You will have a penchant for interpreting Ƃnancial data and transforming your analysis into clear and meaningful commentary on results and trends. Ref: pw25691
Global Pensions and Life Insurer are currently seeking a junior Actuarial Analyst. You will be responsible for reviewing system speciƂ cations and test calculation functionality, developing excel based models, providing analytical support for ad-hoc projects and performing data analysis. To be considered you will have a minimum of a 2:1 in an analytical subject at degree level, Actuarial analysis experience within the Life and Pensions sector and be making steady progress with your actuarial exams. Experience of VBA and SQL would also be highly beneƂ cial. Ref: RP25379
E UR OP E
THE ACTUARY • December 2016 www.theactuary.com
ACT RecHouse Dec16.indd Mansion FP.indd46 1
INVESTMENT MANAGER €60-80k + bonus + beneƓts PARIS
H&P ACTUARY €50-65k + bonus + beneƓts PARIS
Individual with strong expertise in investment and ALM required for a leading international Ƃrm. You will work on various projects such as ALM, strategic asset allocation, pension funds structuration, as well as Ƃnancial accounting, reporting and asset data in order to take the investment decision for companies. You will manage a dynamic and international team. ProƂciency in English is required. You must be curious, have good communication and interpersonal skills. Ref: ehth25688
Actuary with expertise in H&P required for a consulting Ƃ rm. You will be in charge of the pricing, the product development, the risk modeling and assist with Solvency II implementation. You will be able to participate in R&D projects and develop your technical skills. Excellent opportunity to grow professionally in a Ƃ rst rate working environment. You must be autonomous, curious, have good communication and interpersonal skills. Ref: ehth24577
PRICING ACTUARY €50-65k + bonus + beneƓts PARIS
EMPLOYEE BENEFITS CONSULTANT €Negotiable + bonus + beneƓts PARIS
Actuary with strong expertise in pricing and GLM modeling for personal lines required for a leading Ƃrm. You will be in charge of the development of pricing models, proƂtability analysis as well as the anticipation of new market trends and pricing innovation using Big Data. You must be autonomous, curious, pro-active and have strong experience in Emblem or Pretium. Ref: ehth24550
Individual with strong expertise in employee beneƂts required for a leading worldwide consulting Ƃrm. You will be in charge of actuarial valuation and implementation of pension plans, ALM and work on assignments such as retention or total rewards as well as M&A projects. You will grow in a dynamic team and must be proactive and have good communication skills. Ref: ehth23714
21/11/2016 10:19 16:17 18/11/2016
www.theactuaryjobs.com ACTUARIAL POST RECRUITER OF THE YEAR 2012 . 2013 . 2014 . 2015
PENSIONS LEADERSHIP ROLES EXCLUSIVE: HEAD OF PENSIONS ACTUARIAL £ to attract exceptional talent PENSIONS LOCATION UPON APPLICATION
Market-leader seeks a qualiﬁed pensions actuary, with entrepreneurial ﬂair, industry presence and a vision for the future of deﬁned beneﬁt pensions, to build, develop, and lead a new pensions actuarial consultancy. The successful candidate will believe that things can be done differently, be considered in their views and robust to challenge, and be committed to maintaining a high level of trust and integrity. You will also have the appetite to take a leap into the unknown.
Adam Goodwin ASSOCIATE DIRECTOR +44 7584 357 590 firstname.lastname@example.org
Please contact Adam Goodwin to discuss this unique opportunity.
CONSULTING SCHEME ACTUARY £ excellent package PENSIONS LOCATION UPON APPLICATION
Market-leading pensions consultancy has a fantastic opportunity for a qualiﬁed actuary to take up a leadership position and contribute to the strong growth of the ﬁrm. The successful candidate will hold a Scheme Actuary certiﬁcate and have proven consulting skills employed in business development and client relationship management, alongside strong technical skills.
Irene Paterson FFA PARTNER +44 7545 424 206 email@example.com
Please contact Irene Paterson to discuss this exciting role.
Antony Buxton FIA MANAGING DIRECTOR +44 7766 414 560 firstname.lastname@example.org
Louis Manson MANAGING DIRECTOR +44 7595 023 983 email@example.com
ACT Rec Dec16.indd 47
PLEASE CONTACT STAR ACTUARIAL FUTURES TO DISCUSS YOUR EXECUTIVE RECRUITMENT NEEDS FOR M ORE VACA N2016 C IES VISIT December • THE ACTUARY
www.staractuarial.com 21/11/2016 16:17
Appointments N ON - L I F E L IFE R IS K P E N S IO NS I NVESTM ENT HEALTH PRICING INNOVATION - EXCLUSIVE
DATA EMPIRE - EXCLUSIVE
GROUP CAPITAL ACTUARY
£ competitive salary and beneﬁts package
£ dependent on experience
NON-LIFE LIFE INVESTMENT LONDON
Innovative and growing international business, looking to hire a business-minded actuary with personal lines pricing expertise to support pricing activities, whilst also assisting with actuarial support in other areas.
A unique business seeks a specialist to develop, drive and shape data strategy and insight. The role requires creating a data infrastructure, as well as validation and enrichment through utilising optimal sources.
Leading insurer seeks qualiﬁed actuary to support the consolidation of Group Solvency II forecasts and projections for business planning, and to manage the delivery of timely and accurate ﬁnancial results.
BUSINESS DEVELOPMENT ACTUARY
COMMERCIAL PRICING MANAGER
£ excellent package
£ competitive + bonus + beneﬁts NON-LIFE LONDON
NON-LIFE SOUTH EAST
Global business wishes to hire a forwardlooking actuary to join its head ofﬁce team in a wide-ranging role encompassing pricing, project management, research and development.
Leading London Market company seeks a partqualiﬁed or qualiﬁed non-life actuary to provide support for independent pricing governance through higher level “thematic” reviews around pricing and portfolio performance.
Leading international insurer is currently seeking a qualiﬁed non-life actuary to contribute to its business pricing strategy and roadmap and develop new algorithms, rating structures and parameterisations.
TECHNICAL PRICING MANAGER
NON-LIFE PRICING ANALYTICS
LEAD THE ACTUARIAL WAY
£ excellent + bonus + beneﬁts NON-LIFE SOUTH EAST
£ very attractive STAR3626
NON-LIFE LIFE HEALTH LONDON
Leading international insurer seeks a qualiﬁed non-life actuary with personal lines technical pricing experience to be responsible for the delivery of the technical pricing basis. Emblem, Radar, SAS knowledge essential.
Leading specialist insurer seeks a partqualiﬁed or qualiﬁed non-life actuary with strong computer skills (particularly Excel, VBA & SQL) to develop and maintain pricing tools for underwriting risks.
Our client is looking to hire an expert in actuarial reporting and modelling. The ideal candidate will have a successful track record of leading a team, together with excellent technical skills.
PROPERTY & CASUALTY RESERVING
SENIOR MANAGER - INVESTMENT
£ dependent on experience
£ excellent package
NON-LIFE SOUTH WEST
NON-LIFE LIFE INVESTMENT FLEXIBLE
£ very competitive package STAR3552
An exciting opportunity for a part-qualiﬁed or qualiﬁed actuary with non-life reserving experience to develop market-leading technical provision methodologies and provide key business planning insights.
Leading insurer seeks a qualiﬁed actuary (or CFA) with signiﬁcant ALM experience in an insurance context and an understanding of risk management. Awareness of industry developments and best practice is essential.
Research-led consultancy, experiencing signiﬁcant growth, seeks a qualiﬁed investment consultant (Actuarial or CFA) with strong project management skills to strengthen its practice.
HEAD OF INVESTMENTS - NON-LIFE
MAKE A DIFFERENCE IN PENSIONS
£ excellent package
£ excellent package
INVESTMENT LOCATION UPON APPLICATION STAR3609
Major insurer seeks a qualiﬁed investment expert, with experience in an insurance investments environment, to provide continuous oversight of the Group’s investment holdings across various entities.
Leading investment ﬁrm has an exciting opportunity for a qualiﬁed actuary (or CFA) to contribute to cutting-edge investment advice and strategy. Modelling skills and ALM experience essential.
An exciting opportunity for a part-qualiﬁed or qualiﬁed actuary to join a leading independent consultancy in the North and work with the directors to provide solutions to a wide range of clients.
CALLING PENSIONS MANAGERS
£ excellent package
£ dependent on experience
STARVACANCIES PENSIONS LEEDS
Unique role in the North for a qualiﬁed pensions actuary, working on a variety of schemes in a growing company. Previous client-facing experience and the ability to communicate at all levels required.
We are currently working on a unique opportunity for a qualiﬁed pensions actuary with exceptional interpersonal skills to take up a leadership position. Please contact us for more information.
Multiple opportunities for qualiﬁed pensions actuaries to join a leading consultancy in client-facing roles, providing cutting-edge advice on pensions strategy.
Antony Buxton FIA
Irene Paterson FFA
MANAGING DIRECTOR +44 7766 414 560 firstname.lastname@example.org
MANAGING DIRECTOR +44 7595 023 983 email@example.com
PARTNER +44 7545 424 206 firstname.lastname@example.org
OPERATIONS DIRECTOR +44 7739 345 946 email@example.com
Lance Randles MBA
ASSOCIATE DIRECTOR +44 7889 007 861 firstname.lastname@example.org
A ASSOCIATE DIRECTOR + +44 7740 285 139 email@example.com
SENIOR CONSULTANT +44 7432 791 061 firstname.lastname@example.org
DIRECTOR - INSURANCE SEARCH THE ACTUARY+44 • December 2016 7870 181 444 www.theactuary.com email@example.com
ACT Rec Dec16.indd 48
ACTUARIAL POST RECRUITER OF THE YEAR 2012 . 2013 . 2014 . 2015 BUSINESS ACTUARY
PROTECTION STRATEGY & PERFORMANCE
SENIOR CAPITAL PLANNING ACTUARY
£ excellent package
£ excellent package
LIFE FLEXIBLE LOCATION
LIFE YORK OR BRISTOL
Seeking a qualiﬁed life actuary with experience of calculating performance metrics under a range of bases (including IFRS, Solvency II and MCEV) to manage the actuarial activity of our client's retirement lending actuarial team.
Major insurer requires a qualiﬁed life actuary to lead the modelling, analysis and potential optimisation of its reinsurance arrangements, maintaining a robust process to ensure accurate modelling.
Leading insurer seeks a qualiﬁed life actuary with a thorough understanding of capital metrics to manage the delivery of the annual SST exercise, providing analysis and insight into the output.
FTC: HEAD OF PROTECTION PRICING
PRODUCT DEVELOPMENT ACTUARY
£ dependent on experience
LIFE SOUTH COAST
LIFE SOUTH EAST
LIFE SOUTH EAST
Leading insurer seeks a qualiﬁed life actuary with strong technical pricing skills to support the pricing, development, and optimisation of all new protection products for a 12-month contract.
Leading client wishes to hire a qualiﬁed life actuary with strong stakeholder management skills to manage the pricing of its US Care products and retirement lending business and to develop new products.
Our client seeks a part-qualiﬁed or qualiﬁed life actuary to provide actuarial support to product development, bulk deals, systems development and corporate projects.
DIVISIONAL PRICING OPPORTUNITY
REPORTING AND ANALYSIS ACTUARY
SENIOR MODEL GOVERNANCE MANAGER
£ depending on experience
£ excellent + bonus + beneﬁts
LIFE LONDON OR SOUTH EAST
£ excellent + bonus + beneﬁts STAR3611
Leading reinsurer is seeking a part-qualiﬁed or qualiﬁed life actuary with strong technical and analytical skills to support division-wide pricing activities. Experience working with and analysing large data sets required.
Our client, a specialist ﬁnancial services ﬁrm, has an exciting opportunity for a qualiﬁed life actuary to lead the delivery of its actuarial reporting requirements for Solvency II, IFRS, EV and risk-based capital metrics.
We are currently working with a leading insurer in the search for a qualiﬁed life actuary with experience of dealing with senior management and the ability to co-ordinate across various teams.
REINSURANCE - ACTUARIAL MODELLER
SENIOR ACTUARY – ZURICH
GROUP FINANCE MANAGER
£ excellent + bonus + beneﬁts
CHF excellent package
£ excellent + bonus + beneﬁts STAR3604
LIFE RISK LONDON OR SOUTH COAST
Leading reinsurer seeks a part-qualiﬁed life actuary with coding experience (C++ or Visual Basic) to assist in the development and maintenance of modelling tools and processes across all Business Units.
Multinational insurer requires a qualiﬁed life actuary to play a major role within its Zurich-based team. Experience in Prophet modelling and ﬂuency in both English and German are essential.
Leading insurer seeks a qualiﬁed actuary with gravitas and a wide skillset to support the delivery of a risk-based assurance programme (i.e. internal audits and advisory reviews) within the Finance, Risk and Capital domain.
FINANCIAL RISK ACTUARY
INSURANCE INVESTMENT STRATEGY
£ competitive salary + beneﬁts
£ competitive salary + beneﬁts package
£ excellent package
LIFE RISK EDINBURGH
LIFE INVESTMENT RISK EDINBURGH
LIFE RISK EDINBURGH
Large insurer is looking to hire a part-qualiﬁed actuary to contribute to internal model validation work. A good knowledge of Solvency II is required, along with understanding of risk and capital management.
Our client is looking to hire an actuary with a depth of knowledge and understanding of ﬁnancial risks, capital management, and Solvency II to support internal model validation and further develop a robust framework.
FOR MORE VACANCIES VISIT ACTUARY - ACTUARIAL ASSURANCE
£ very competitive
£ excellent + bonus + beneﬁts
LIFE INVESTMENT LONDON
Qualiﬁed actuary with risk management skills sought to review and challenge key results from 1st line actuarial teams across pricing, valuation, capital management, experience monitoring and ALM teams.
LIFE INVESTMENT SOUTH COAST
Our client is seeking a qualiﬁed actuary with strong knowledge of structured business to support the rapidly evolving insurance investment strategy, optimising the return on the annuity investment portfolio.
www.staractuarial.com ALM ACTUARY £ very competitive STAR3613
Star Actuarial Futures is currently working alongside a major insurer in the search for a part-qualiﬁed or qualiﬁed actuary (or CFA) to support the design, implementation and oversight of its investment strategies.
LIFE INVESTMENT LONDON
Specialist ﬁnancial services group is seeking a qualiﬁed actuary with excellent problem analysis and resolution skills to support the development and implementation of its ALM framework.
JJan Sparks FIA
ASSOCIATE DIRECTOR +44 7950 419 115 firstname.lastname@example.org
A ASSOCIATE DIRECTOR + +44 7477 757 151 email@example.com
ASSOCIATE DIRECTOR +44 7584 357 590 firstname.lastname@example.org
ASSOCIATE DIRECTOR +44 7860 602 586 email@example.com
Margaret de Valois FIA
ASSOCIATE DIRECTOR +44 7786 992 802 firstname.lastname@example.org
SENIOR CONSULTANT +44 7714 490 922 email@example.com
SENIOR CONSULTANT +44 7492 060 219 firstname.lastname@example.org
ACT Rec Dec16.indd 49
Star Actuarial Futures Ltd is an employment agency and employment business
LIFE SOUTH EAST
December 2016 • THE ACTUARY 49 www.theactuary.com
Looking for your next step? Embrace new opportunities with Oliver James Associates We have been successfully guiding and shaping the careers of actuaries since 2002. Our consultants are experts in their vertical markets with an unrivalled network across the insurance, pensions and investments sectors. We partner ^P[OSLHKPUNPUZ\YHUJLĂ„YTZHUK consultancies in the UK, Europe, USA and Asia, enabling our teams to access the best and most exclusive career opportunities in the market today.
50Oliver THE ACTUARY â€˘ December 2016 James Associates www.theactuary.com Delivering with Excellence
ACT Rec Dec16.indd 50
Snapshot of Live Actuarial Vacancies
LIVE UK JOBS
www.theactuaryjobs.com LIVE GLOBAL JOBS
Life, Pensions & Investments Capital Management Actuary London )VU\Z)LULÄ[Z
Senior ALM Actuary London )VU\Z)LULÄ[Z
Solvency II Contractor Dublin €700 /day
Leading insurance organisation is looking MVYHX\HSPÄLKHJ[\HY`[V^VYR^P[OPU[OLPY Capital Management team. The role will have high visibility across the group and require excellent stakeholder management skills.
-HU[HZ[PJVWWVY[\UP[`MVYHX\HSPÄLKHJ[\HY`[V join the Capital Solutions team of this leading organisation in London. The role will provide exposure to capital optimisation, investments and ALM. Looking for experience across a number of asset classes.
We are working with a Dublin based life insurer to recruit a contractor to improve [OLLɉJPLUJ`VM[OLPY:VS]LUJ`00YLWVY[PUN Prophet development skills are essential. 3 - 6 month contract.
Life Insurance Consultant London Up to £80,000 + Package
Validation Actuary West Midlands £70,000 - £80,000
Reporting & Systems Contractors London £300 - £1,000 /day
Mutil award-winning, London based JVUZ\S[HUJ`PZZLLRPUNHUL^S`X\HSPÄLK actuary to join their life insurance team. The position focusses on ALM and transaction projects for new and existing business.
Excellent opportunity for a Validation Actuary to join the Risk and Actuarial function of a composite insurer. Our client, the Chief (J[\HY`PZZLLRPUNHX\HSPÄLKHJ[\HY`^P[O experience in Solvency II, risk management and model validation.
We are working with a major life insurer going through a migration project to recruit reporting and systems (Moses, Mo.net, prophet) contractors at all levels.
Reserving Manager London )VU\Z)LULÄ[Z
Pricing Actuary London )VU\Z)LULÄ[Z
Pricing Actuary London £600 - £800/ day
Opening for a Reserving Manager to join a large, very well respected, market leading London Market business. You will be a X\HSPÄLKHJ[\HY`V\[Z[HUKPUNJVTT\UPJH[VY and technically excellent in the reserving arena. Exceptional career opportunites.
A well known London Market Syndicate PZSVVRPUNMVYH558HJ[\HY`[V[HRLVUH ZPNUPÄJHU[YVSLPUHOPNOWLYMVYTPUN[LHT You will need to be comfortable working very closely with the underwriters and be happy working across multiple lines of business.
A London market client is seeking a pricing actuary on a contract basis. You must have London market pricing experience, preferably WYVWLY[`;OLYVSLPZ558SL]LSI\[^PSS consider FIA.
Senior Reserving Actuary Gloucestershire / London / Kent £50,000 – £80,000
Capital Modelling Analyst London )VU\Z)LULÄ[Z
Reserving & Capital Manager London Fixed Term Contract
We have three clients based in London, Kent and Gloucestershire who have a variety of reserving roles available working on personal SPULZ>LOH]LYVSLZ]HY`PUNMYVTWHY[X\HSPÄLK ¶[^V`LHYZWVZ[X\HSÄJPH[PVU4\Z[OH]L9LZ8 must have worked within general insurance.
A growing Lloyd’s syndicate is seeking a part X\HSPÄLKHJ[\HY`[V^VYRVUH^PKLYHUNL of capital modelling activities. This is a high WYVÄSLL_WHUKPUNHYLHVM[OLI\ZPULZZ^P[O challenging work and regular exposure to senior management.
>LOH]LHTVU[OÄ_LK[LYTJVU[YHJ[ to manage the reserving and capital teams for a personal lines insurer. We are seeking somebody with strong knowledge of Solvency II, reserving and capital.
Contact Us Benjamin Moses - Contract +44 207 310 8793 email@example.com
Richard Howard - Life +44 207 649 9356 firstname.lastname@example.org
www.ojassociates.com @OJAssociates oliver-james-associates
John Bleasdale - GI +44 207 649 9361 email@example.com November 2016 • THE ACTUARY 51 www.theactuary.com
ACT Rec Dec16.indd 51
The Actuarial Recruitment Company
A fresh approach
Head of Strategy, Pricing London
General Insurance Competitive
Varied Role London
General Insurance To £85K
In this role you will be responsible for driving forward the development of pricing processes and tools across the pricing team and hence throughout a global business. The role will cover all lines of business underwritten including Commercial and Specialty Lines. The successful candidate will be aware of market best practice in pricing across a number of lines of business and have a track record of taking ownership of new initiatives and seeing them through to implementation in a collaborative way. Ref: ARC26327
A senior student up to a newly qualified actuary is needed for this
Reserving Actuary/Senior Analyst General Insurance South West £Excellent
Validation Analyst London
A qualified or part qualified actuary is required by this domestic
This major London Market and retail business is looking for a part qualified
insurer writing both personal and commercial lines to work within their
actuary with hands on capital experience who wants to move more into
small reserving team. The role will involve interaction with other areas
a risk management environment. The role will include model testing,
of the business, and cover all lines of business underwritten. It will
challenge and validation, support and improvement of stress and scenario
report into the Head of Reserving. The role responsibilities will depend
testing and risk appetite monitoring as well as supporting production of
upon the level of experience of the person joining the team and prior
regulatory submissions including the ORSA. Very good communications
reserving experience is essential. Ref: ARC26324
skills will be important. Ref: ARC26321
specialist insurance and reinsurance business to provide pricing governance, rate monitoring and reporting support. In addition the role will provide input to business planning and pricing strategy as well as reinsurance purchasing. The client is looking for a proactive individual who can provide pragmatic judgement and work in a flexible, open and collaborative way with the business. Ref: ARC26326
General Insurance To £60K
Call us anytime including evenings and weekends on 020 7717 9705 or email firstname.lastname@example.org Andy Clark BSc FIA Roger Massey BSc MBA FIA
0781 333 7891 0781 398 9016
email@example.com firstname.lastname@example.org The Actuarial Recruitment Company is an employment agency
THE ACTUARY • November 2016 www.theactuary.com
ACT Rec Dec16.indd 52 ARC FP.indd 1
18/11/2016 10:47 17:07 17/11/2016