JANUARY/ FEBRUARY 2013 theactuary.com
The magazine of the actuarial profession
Interview: Gabriel Bernardino Building a new European regulatory authority
Modelling The power of long memory
Soapbox Cyber risk, a growing threat
Arts The Actuary
Death: A Self-Portrait
January/February 2013
THE WORLD IS NOT ENOUGH Finite resources and the impact on economic growth p01_jan_feb_cover FINAL•gc.indd 1
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What’s underneath? We look below the surface to spot trends early and show you what is really happening. Whether your need relates to risk management, capital, or strategy, our cutting-edge analysis techniques can help you see deeper than the competition.
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JANUARY/FEBRUARY 2013
Contents ALAMY
“The actuarial profession should recognise that resource constraints raise the possibility of a limit to economic growth in the medium term”
28
26
19
26 UP FRONT
FEATURES
AT THE BACK
10 Profession news
19 Interview: Gabriel Bernardino
34 Arts
14 Industry news 16 People/society news 18 SIAS events
OPINION 5
Editorial Actuaries can help find original solutions to environmental issues, says Deepak Jobanputra
6
Letters Purple prose, projections and dependency ratios
7
President’s comment Philip Scott is impressed at the advances made by the general insurance PEC
8
Soapbox Marie Gemma Dequae calls for improved data to counter the rapidly growing threat to information security
Nick Mann in discussion with the man at the centre of the wholesale overhaul of Europe’s pensions and insurance regulation and supervision
The Blind Spot by William Byers
MORE CONTENT ONLINE Additional content can be found at www.theactuary.com
37 Puzzle Win a £50 Amazon voucher
22 Modelling: Power of long memory Faisal Zai explains how long-term memory methods can better explain extended periods of market depression than standard econometric methods in common use today
26 Solvency II: Rise to the challenge Radu Popescu explores whether insurers can learn from investment bankers in the application of profit and loss attribution under Solvency II
38 Actuary of the future Pamela Neil of Aviva
39 Student Jessica Elkin ponders the chances of an actuarial amour
40 Appointments and moves
ONLINE
28 Environment: A finite world Dr Aled Jones looks at the impact of resource constraints on economic growth
30 Environment: Carbon omissions Can insurers overcome the constraints that come with carbon capture, asks Chris Gingell
32 Spotlight: Climate change 36 Book review
Nick Mann contemplates the universal, non-discriminatory element of life
Yves Guérard reports on the new the Actuarial Climate Risk Index
Our survey says... Members provide their views on The Actuary magazine
No limits to using Monte Carlo for modelling Game-changing technology could become the ‘new normal’ for the insurance industry, say Osmo Jauri and Timo Penttilä
Are ‘golden skirts’ the answer? Alana Paterson on gender quotas
WRITER OF THE MONTH Chris Gingell wins a £50 book token for his article on carbon capture and storage, courtesy of the Staple Inn Actuarial Society
January/February 2013 • THE ACTUARY www.theactuary.com
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Editorial DEEPAK JOBANPUTRA Redactive Media Group 17-18 Britton Street, London EC1M 5TP +44 (0)20 7880 6200 Editor, Redactive finance division Mike Thatcher Publishing director Joanna Marsh Chief sub-editor Caroline Taylor News editor Nick Mann +44 (0)20 7324 2794 nick.mann@theactuary.com Recruitment and display manager Katy Eggleton +44 (0)20 7324 2762 katy.eggleton@redactive.co.uk Recruitment sales Gill Rock +44 (0)20 7880 6234 gill.rock@redactive.co.uk Digital sales Leila Serlin +44 (0)20 7324 2787 leila.serlin@redactive.co.uk
Managing editor Sharon Maguire +44 (0)20 7880 6246 sharon.maguire@redactive.co.uk
Opinion
Editor Deepak Jobanputra editor@theactuary.com Editorial team Sarah Bennett health, international Jeremy Lee pensions, investment, ERM, banking
Actuaries can help find original solutions to environmental issues, says Deepak Jobanputra
Richard Purcell Richard Schneider, life, Solvency II, mortality/longevity, modelling and software
Earth’s natural wealth
Helen Lau, GI, reinsurance, environment, careers (UK) Aoife Martin, GI
Art editor Gene Cornelius
Profession news editor Alison Jiggins +44 (0)20 7632 2172 alison.jiggins@actuaries.org.uk
Picture editor Akin Falope Production manager Jane Easterman +44 (0)20 7880 6248 jane.easterman@redactive.co.uk
People/society news editor Yvonne Wan social@theactuary.com
Print Southernprint Ltd
Student page editor Jessica Elkin student@theactuary.com
Internet The Actuary website: www.theactuary.com
Arts page editor arts@theactuary.com SIAS representative Alvin Kissoon
SIAS website: www.sias.org.uk Actuarial Profession website: www.actuaries.org.uk
Circulation 22,733 (July 2011 to June 2012)
Editorial advisory panel Peter Tompkins (chairman), David Campbell, Matthew Edwards, Martin Lunnon, Marjorie Ngwenya, Sherdin Omar, Richard Purcell, Andrew Smith, Nick Silver
Subscriptions For subscriptions from outside the actuarial profession: UK, Eire and Europe: £55 a year/£5 a copy. For the rest of the world: £80 a year/£7.50 a copy. Please contact: Alison Jiggins, The Actuarial Profession, Staple Inn, High Holborn, London WC1V 7QT T +44 (0)20 7632 2100 E alison.jiggins@actuaries.org.uk Students on actuarial science courses at universities may join the Staple Inn Actuarial Society for £6 a year. They will receive The Actuary as part of their membership. Apply to: Membership Department, The Actuarial Profession, Maclaurin House, 18 Dublin Street, Edinburgh EH1 3PP. T +44 (0)131 240 1325 E membership@actuaries.org.uk Changes of address should be made known to the membership department as above. For delivery queries, please contact: Jane Easterman E jane.easterman@ redactive.co.uk Published by the Staple Inn Actuarial Society The editor, The Institute and Faculty of Actuaries and Staple Inn Actuarial Society are not responsible for the opinions put forward in The Actuary. No part of this publication may be reproduced, stored or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without prior written permission of the copyright owners. While every effort is made to ensure the accuracy of the content, the publisher and its contributors accept no responsibility for any material contained herein. Important information for contributors to The Actuary By submitting content for publication you confirm that: (a) You (and/or other named contributors) are the sole author(s) of the content submitted; (b) The content you submit is original and has not previously been published (unless you specifically advise us to the contrary); (c) You haven’t previously licensed the use of the content you submit; (d) So far as you are aware, the content submitted will not infringe any third-party rights, be defamatory or in any way illegal.
Welcome to the first issue of The Actuary in 2013. We start this year with a focus on the environment and resources. While the world is grappling with growth initiatives to feed the economic demands of society, there are other big trends that are well known to us all. Among these, the issue of our carbon footprint will shape the lives of future generations. We know we must act to prevent undue damage to Mother Nature and take a responsible stance in this area. The bigger question, however, is how. There are various estimates of the approximate number of years left for the commodities that we are so reliant upon, such as oil and key metals. These are accompanied by a vast number of global initiatives, with the world’s most powerful leaders meeting regularly to drive change. As an optimist, I firmly believe that big challenges provide us with an opportunity to draw out innovative solutions that we may otherwise not have been inclined to consider. I am sure we can all think of examples of unnecessary waste that can be averted. In many parts of the UK, we have been introduced to recycling as a matter of course – something we would not have considered on such a scale a few decades back. But governments and economic bodies will need a wide array of skills to address these challenges. Developing models that consider the potential outcomes resulting from the range of possible ways to deploy resources will be fundamental. Actuaries are well placed to contribute and lead these discussions with other professionals. Our blend of training, skills and experience puts us in a good position to assess risks and derive solutions – as shown in this month’s article on carbon capture (p30), which considers an innovative solution while deploying traditional actuarial principles. Our cover headline sums up quite nicely that the ‘world is not enough’. This may be the first and last analogy I draw between actuaries and the infamous James Bond in saving the world!
‘I firmly believe that big challenges provide us with an opportunity to draw out innovative solutions’
Deepak Jobanputra editor@theactuary.com
© SIAS January/February 2013 All rights reserved ISSN 0960-457X
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January/February 2013 • THE ACTUARY www.theactuary.com
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letters@theactuary.com
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Opinion Letters
LETTER OF THE MONTH
— ER RIT THE WLETTER E OF TH E MONTH OF TH EIVES A REC AZON M £25 A CHER VOU —
We are ‘railing against complacency’ Richard Chapman suggests in his letter (Railing against complacency, p8, December) that actuaries should have greater profile in risk management, citing the West Coast Main Line rail franchise as an example. Readers may be interested to know the latest developments in this matter and that actuaries are indeed involved. In response to the issues raised by the events surrounding the West Coast franchise, Sir Nicholas Macpherson was asked to lead a review of the quality assurance of analytical models that inform policy across government. His interim report (bit.ly/WmxnZx) was released in December. The government actuary is on the steering group, and I am part of the multidisciplinary team tasked with this review. Colin Wilson 18 January
Are we aiding Purple prose? I write this letter expecting to be derided by many actuaries. In December, The Actuary (Industry news, p14) reported that the Purple Book shows the aggregate funding level of UK defined benefit schemes dropping from 100% to 77% in the 18 months from March 2011. Well, if we reckoned in March 2011 that we held enough assets to provide all the promised accrued benefits over the next, say, 80 years, what has changed so drastically? Are future benefits payments going to be bigger than anticipated? No. Are the dividends and interest payments to be generated over the next 80 years now expected to be much less than in early 2011? No. If anything, the outlook for future investment return is more optimistic now than it was then. Has there been a further unexpected increase in future mortality rates? I am unaware of any such change. In my view, one of the two figures quoted by the Purple Book must be wrong. The actuarial profession appears to have followed a path during the past two decades where we now aid the production of meaningless figures that cause confusion rather than helping to shed light on the state of pension scheme funding. Robert D Garvin 24 January
Ageing Society debate: good reason for dependency ratios Although I could not attend ‘The Cost of our Ageing Society’ debate, I would like to respond to Terry Arthur’s letter on the event (No saving grace for our Ageing Society, p6) by pointing out that there is still good reason why support and dependency ratios should feature centrally in this debate. Saving for retirement is certainly important, but it does not insulate future pensioners from the dependency ratio, for the simple reason that the resulting pension pot is only worth what it can buy the pensioner in real terms in the future (for instance, food, housing, medicines etc). This in turn means there is still a reliance after retirement on prices of these things, and hence on the productivity of the economy, the size of the labour force and, in turn, the dependency ratio. Even the ability of future pensioners to import the necessities of retired life is affected, because the purchasing power of the domestic currency is based on the export capacity of the domestic economy, and therefore dependent on the number of workers and their productivity. The ageing of populations in trading partner nations will compound the issue if it means that global output is reducing (or growing less quickly) than is currently the case. Admittedly, the link to the dependency ratio is still far from direct – for example, the consequences mentioned above will be offset to some degree by increased labour productivity over time and by investing pension savings in the productive companies and economies of the future. Ultimately, however, the world’s population can only consume the same amount it can produce, with pensioners having to compete alongside everyone else for the goods and services on offer. Having pension savings is certainly better than the alternative, but is still no guarantee of protection from demographic and economic trends. Julian Ellacott 3 January
Projections predicament
MORE LETTERS ONLINE More letters are available online at www.theactuary.com/opinion
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ALAMY / REX
The industry news report (Reality check as FSA cuts projection rates for savers, p14) in the December issue of The Actuary reminded me of my time in South Africa in the mid-1970s. Our sales agents were issued with tables of projection factors for the most common situations, and from time to time I would receive requests from sales agents asking for projections for situations that weren’t provided for. Two of those situations neatly illustrated their attitude. One situation was in telephone calls beginning “We’re in competition...”, signalling that they wanted me to quote using a projection factor higher than the ‘high’ rate, which I would refuse to do. The other was in requests for projections not covered by the standard tables. Fair enough, but then callers would say “not to bother” with figures for the lower projection rates; of course, I always did. Is the attitude of sales people still similar to that? Peter Pook 29 November
The editorial team welcomes readers’ letters but reserves the right to edit them for publication. Please email letters@theactuary.com. The deadline for receiving letters for the March issue is 18 February 2013.
THE ACTUARY • January/February 2013 www.theactuary.com
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Opinion President’s comment
Philip Scott is the president of the Institute and Faculty of Actuaries
PHILIP SCOTT
Making great strides I have continued my visits to the practice executive committees (PECs) operating from the various areas of the Profession. Last month was the turn of the General Insurance PEC. It was a very enjoyable visit and I want to share the news of what they are doing and hope to achieve in the future. Meeting approximately every two months, the group comprises 14 members chaired by Duncan Anderson. What came across foremost in meeting the committee was the deep sense of camaraderie among its members. Although general insurance contracts have operated for centuries, it was only a working lifetime ago that general insurance was included in the Institute and Faculty’s actuarial syllabus. At the time, few actuaries were working in this area and this instilled a very collaborative atmosphere as new ideas and techniques were being developed. Within the PEC, members leave their day jobs behind and are free to speak as individuals and to express views that encourage open discussion, positive attitudes and cooperation. Many of the members and volunteers find time on top of significant workloads to further the interests of the profession. Turning to the recent work that the GI PEC has been involved in, I was pleased to see how much has been done for the benefit of the membership, including: ● Establishment of a specific working party to produce a paper for external use on issues surrounding differentiation, discrimination and fairness in general insurance pricing. This is a topic of interest to the wider public and it is expected that the paper will be of much interest to journalists and policymakers. ● Organisation of 11 continuing professional development (CPD) events, including a meeting to discuss current issues in general insurance and seminars on pricing, reserving and capital modelling. Another seminar on the actuarial function under Solvency II is planned. ● Upgrading of the syllabus and core reading for the 2013 exams. ● Input into the work of the Professional Regulation Executive Committee (PREC), which deals with the setting and maintenance of professional standards. ● Maintenance of a strong link with the
Philip Scott is impressed at the advances made by the general insurance PEC
Casualty Actuarial Society (CAS) in the US, with cross participation between the two professional groups. Until very recently, the Institute and Faculty had a member on the CAS board with observer status. Information about general insurance – and, in particular, the data underlying much of the business – is limited. The PEC has been working to make sure that it uses what information is available to inform the profession and the wider public about relevant issues. Most recently, it has helped to inform and shape debate on gender pricing, responding to HM Treasury’s consultation, and on motor pricing for the Office of Fair Trading and the Government Transport Committee. The working parties looking at third-party business and periodic payment options have also raised the profile of the Profession and the actuary’s role in general insurance – their work having received media coverage and recognition by government and key stakeholders. This branch of the profession is growing steadily, and members are found throughout the world. The PEC does its best to ensure that these members are not forgotten when it comes to participation and support. It recognises that, although the general insurance market can differ widely across continents and although businesses
will have their own local challenges, there are many strands of actuarial theory that are relevant to all. In future, the PEC hopes to provide more opportunities for CPD to be completed online, and for communication within forums. This should help to foster a sense of community. One issue of public interest that the GI PEC is driving forward is that regarding the Solvency Capital Requirement (SCR) and the directive to check that the level of SCR under Solvency II ensures that the likelihood of an insurer being ruined during the year is no more than 1 in 200. The PEC is concerned that there could be misunderstandings and false confidence about the adequacy of the SCR under the new regime. The PEC has established a working group on the topic and hopes to issue information and comment on the topic. I wish the GI PEC all the best for its future work. I know the members are a hard working and committed set of individuals, and the volunteers that assist them are an invaluable resource. Future articles will consider the work done by other practice area PECs, such as that for health and care. I look forward to sharing more of the much appreciated work these committees do that may otherwise go unrecognised. a
“Information about general insurance is limited, but the PEC uses what is available to inform the wider public about relevant issues”
January/February 2013 • THE ACTUARY www.theactuary.com
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Opinion Soapbox
MARIE GEMMA DEQUAE
Cyber reality: time to quantify risk Cyber risk is a large and growing threat to business. Quantifying exposure is in its very early stages because of the scant data currently available and the evolving nature of the risks. But pressure will increase for more precise estimates of exposure. Last autumn, a survey of members of the Federation of European Risk Management Associations (FERMA) revealed a majority saying that board involvement in cyber risk in their companies was growing. In Europe, draft legislation will add to company obligations on data security breaches, while, in the US, the Securities and Exchange Commission is looking for and sometimes requiring disclosure of security issues. Information security is a classic “enterprise risk” and should not be viewed as the sole domain of the chief information officer. The ability to assess potential maximum loss will enable companies to judge what financial provision is needed for cyber risks, including whether to buy insurance and what limits are worthwhile. The accuracy of insurers’ pricing of cyber risk policies is a separate, but clearly related, issue. Such risks are a threat to the digital assets of a business: client details, confidential information, intellectual property and operating systems. Most common are attacks on client data to get at financially valuable information. At the other end of the frequency distribution are efforts to capture intangible assets or assaults on operating systems. These do, however, occur, and governments are taking the potential for interference with critical infrastructure organisations seriously. The cost implications of these risks range from predictable items, such as customer notification and call centre expenses, to openended business exposure, including loss of income from intellectual property and loss of competitive advantage. Data, however, is poor, especially outside the US. Companies do not want to air their problems in public, and, in Europe, notifying customers that their information has been compromised has not been compulsory. Most estimates are based on US cases or have a very wide margin of error. Quoted figures tend to be broad – so many billions a year lost to cyber
8
Marie Gemma Dequae calls for improved data to counter the rapidly growing threat to information security
crime, for example, or an estimated mean loss per company. Businesses cannot rely on this information to benchmark their own exposure except in the simplest way. The first step in overcoming these limitations is for the risk manager to collaborate on developing scenarios that are truly representative of the company’s exposure. They can also draw on examples where the companies involved have disclosed the financial impact of cyber incidents. This can be useful in engaging board interest. In this way, companies can estimate the consequences of cyber risk – from immediate costs to the longer-term impact on reputation. Next, combining this scenario analysis with suitable quantitative analytical tools will help to estimate probable loss distribution from a wide range of events. The critical issue is that the assumptions underpinning any model are grounded to the specific business model and capture the extraordinarily dynamic nature of cyber risk; the instigators are very inventive. Ideally, the risk manager will also be able to see how changing various assumptions affects the risk profile, stress-testing the results without rerunning the whole model.
This approach of combining scenario and quantitative analysis could also be useful for communicating cyber risks to senior management. The higher you venture into an organisation’s structure, the more straightforward the message needs to be. Colleagues have told me that they have seen well embedded principles and practices associated with risk management and risk financing discarded when information and cyber security are considered. By working as outlined above, businesses can avoid over-reacting to scare stories about cyber risks while acknowledging the true dangers and bringing them under a proper risk management approach. a
“The critical issue is that assumptions are grounded to the specific business model and capture the extraordinarily dynamic nature of cyber risk”
Marie Gemma Dequae is scientific advisor to the Federation of European Risk Management Associations. She is a board member of Belfius Bank and Belfius Insurance in Belgium. More information on the research on cyber risk, conducted in cooperation with Harvard Business Review and sponsored by Zurich Insurance, is available at www.ferma.eu Digital risks will also be on the programme at the FERMA Forum, which takes place from 29 September to 2 October in Maastricht.
THE ACTUARY • January/February 2013 www.theactuary.com
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What is your Solvency II capital requirement? How will it evolve?
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Can you be sure you are making the right capital allocation decisions?
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News Profession NEWS UPDATES FROM THE ACTUARIAL PROFESSION
Upfront Opinion CEO’s comment
New experience route to CERA
Derek Cribb argues the case for proportionate regulation to bolster commerce and confidence
Risk management is a growing and diverse field that is well suited to actuaries. It offers many exciting challenges and opportunities for those who show they can make the grade. The chartered enterprise risk actuary (CERA) qualification sets an international quality standard, and is recognised by employers as offering a strong grounding in the subject. Since 2010, the Institute and Faculty of Actuaries has been permitted to award the CERA qualification to Associates and Fellows who have passed the ST9 examination (enterprise risk management specialist technical). In 2012, the CERA board granted the Institute and Faculty of Actuaries additional permission, which allows award of the CERA designation to a restricted number of its members who demonstrate a significant level of expertise and experience in enterprise risk management (ERM). A key objective of this development is to accelerate the establishment of CERA as a premier risk management qualification within the UK by extending it to include experienced ERM practitioners. The first stage of the process was the recognition in 2012 of 10 ERM thought leaders. The second stage, the verifiable experienced practitioner (VEP) route, is now also open. Applications are invited from Fellows and Associates of the Institute and Faculty of Actuaries who are experienced ERM practitioners and consider themselves able to meet the eligibility requirements. Successful applicants will be those who are able to demonstrate a very high level of experience within enterprise risk management, which has been obtained at a senior level. Applications will be accepted only until 31 July 2013. There will be no further opportunity to apply after this date. Details of the specific eligibility requirements, the application process and the information required to support each application will be available from 1 February at bit.ly/XDUBvY
A question of balance Derek Cribb is the chief executive of the Institute and Faculty of Actuaries
balance. For all regulators, it is vital to maintain a balance between encouraging commercial activity and assuring public confidence. It could be argued that the market turmoil we’ve seen is, at least in part, the result of an imbalance towards commercial interests. I’ve no interest in tying up businesses in unnecessary bureaucracy and dreaded red tape. However, the financial sector has to recognise that it has a responsibility to restore its reputation and, in turn, public faith. This is where proportionate regulation is vital. The recent financial crisis caused huge damage to many firms and professions. The actuarial profession’s reputation has perhaps not suffered as much as others, although this may in part be attributable to our lower public profile and a lack of wider knowledge of actuaries’ work. During the past 18 months, we have invested heavily in public affairs and promotion in line with our strategy. However, when you put your head above the parapet, you run the risk of taking a few shots. As our public profile increases, it will be more important than ever to ensure that our regulatory house is in order. Ensuring that our regulatory functions are appropriate to the changing business world is a huge challenge. Our relationship with the Financial Reporting Council – our oversight body – is vital as we decide on a shared way forward, following the implementation of the Morris Review recommendations. In addition, the increasingly international nature of actuarial work and ever-widening reach of the profession can only increase the complexity of the regulatory landscape. The Institute and Faculty of Actuaries must continue to find a balance between regulatory and public interest responsibilities on the one hand and supporting members’ commercial activities on the other. The key will be the strong partnership between the Executive’s in-house talent and the profession’s members across sectors and locations: the support of our volunteers is essential to our success. If you think you have expertise in this area and would like to contribute to our regulatory work, then please do get in touch with Debbie Atkins. a Email debbie.atkins@actuaries.org.uk
DEREK CRIBB
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The way I see it, good regulation is all about
ACCESS THE PROFESSION’S ANNUAL REPORT
THE ACTUARY • January/February 2013 www.theactuary.com
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Pension scheme funding: implications of the chancellor’s Autumn Statement recovery plans pushed further into the future. As economic conditions remain challenging, many sponsors have struggled to grow their business while trustees ask them for increasing pension contributions. In April 2012, the Pensions Regulator commented that the current funding regime offered the correct degree of flexibility. However, the autumn conference season offered other bodies opportunities to spell out how they would like to see easement of the current conditions. HM Treasury has heard the comments and the DWP will consult. As a body, the Institute and Faculty of Actuaries supports the Pensions Regulator’s view that the present regime is suitable, but if a consultation process is to commence (and we
On 5 December 2012, chancellor George Osborne made his Autumn Statement. This mentioned that the Department for Work and Pensions (DWP) will be consulting on a new statutory objective for the Pensions Regulator to consider the long-term affordability of deficit recovery plans, and whether to allow companies undergoing scheme valuations in 2013 or later to smooth asset and liability values. The announcement demonstrated that the government is aware of the problems that the current low gilt yield world is causing for pension scheme funding in many defined benefit (DB) schemes. Increasing liability valuations have not been accompanied by increasing asset values. Deficits have risen and funding requirements have increased, with
Disciplinary Tribunal Panel Report of proceedings from a hearing of the Institute and Faculty of Actuaries Disciplinary Tribunal on 6 November 2012 at Staple Inn Hall, High Holborn, London. ● Mr Lance David Katz FFA was charged with failure to comply with the CPD scheme of the Institute and Faculty of Actuaries for the year 1 July 2009 to 30 June 2010. The Tribunal dismissed all charges against the Respondent and determined that no further disciplinary action should be taken. ● Dr Fayek Hanna Tawdros AIA was charged with failure to comply with the CPD Scheme of the Institute and Faculty of Actuaries for the year 1 July 2007 to 30 June 2008. The Tribunal dismissed all charges against the Respondent and determined that no further disciplinary action should be taken. Report of proceedings from a hearing of the Institute and Faculty of Actuaries Disciplinary Tribunal on 28 November 2012 at
the International Dispute Resolution Centre, Fleet Street, London. ● Mr William George Vasilieff former FFA, was charged with: failure to comply with the CPD Scheme of the Institute and Faculty of Actuaries for the CPD years 1 July 2007 to 30 June 2008, 1 July 2008 to 30 June 2009 and 1 July 2009 to 30 June 2010; failure to attend a professionalism course for experienced actuaries; and failure to co-operate with the investigation. The Respondent admitted the facts of all of the charges and the Tribunal determined that each of the charges amounted to misconduct for the purposes of the disciplinary schemes in force at the material time. The Tribunal imposed a fine of £6,000 against the Respondent. No award of costs was made in favour of either party. A full copy of all the above Tribunal’s determinations can be found at
www.actuaries.org.uk
Appeal Tribunal Panel At an Appeal Tribunal Panel hearing held at the Law Society, Chancery Lane, London, on 13 September 2012, the appellant, Mr Alastair Graham McLean FIA, was successful in his appeal against the decision of a Disciplinary Tribunal Panel of 1 November 2011, which found the appellant guilty of misconduct and imposed a suspension, a fine, and a contribution towards costs.
The decision of the Tribunal was quashed on appeal together with the sanctions imposed and the costs order. An order for costs was made against the Institute and Faculty of Actuaries in favour of the appellant for the sum of £631.45. A full copy of the Appeal Panel’s determination and the order on costs can be found at www.actuaries.org.uk
believe this will happen before the second quarter of 2013), it is important that the right questions are asked. No-one will benefit from a new regime that could lull trustees and scheme sponsors into viewing the world through a skewed looking glass. In the Code of Practice on Scheme Funding, the word ‘afford’ appears once in paragraph 101: “Trustees should aim for any shortfall to be eliminated as quickly as the employer can reasonably afford. What is possible and reasonable, however, will depend on the trustees assessment of the employer’s covenant.” If a new sentence were added to paragraph 2, where the objectives are set, would there be any difference to the funding regime? Would trustees continue to have discretion on what is affordable, or would the Pensions Regulator assess that? Assuming trustees have taken affordability into account when setting recovery plans, will this addition to the objectives change anything? As most schemes are not sponsored by FTSE 350 companies, is there sufficient knowledge within the Pensions Regulator to allow informed decisions to be taken on affordability of schemes? The law of unintended consequences could also result in the regulator intervening where affordability has not been an issue for trustees. Could the regulator ask for sponsors to pay more quickly because there is a stockpile of cash or other liquid assets on the balance sheet? The consultation should also cover the relationship between objectives. If the inclusion of affordability within objectives were to lead to lower contributions, this would, at first glance, reduce security within schemes, which would increase potential claims on the Pension Protection Fund (PPF). Almost certainly there would be an offset to lower contributions from increased levies. Changing an objective is straightforward, but it is the implication of that change that could be significant. The Institute and Faculty of Actuaries is interested in hearing from members about the questions that should be asked within the upcoming consultation. These should address practical concerns and unintended consequences rather than the historical debate of the sustainability of valuation methods, although members understandably hold strong views on that subject. Please contact Philip Doggart, policy manager at the Institute and Faculty of Actuaries, with any comments. Email philip.doggart@actuaries.org.uk
January/February 2013 • THE ACTUARY 11 www.theactuary.com
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News Profession NEWS UPDATES FROM THE ACTUARIAL PROFESSION
Membership: here to help The Actuary hears from two members of the membership team who joined the organisation more than seven years ago to support the growing membership of the Institute and Faculty of Actuaries Q: Who works in the membership team? A: The membership team consists of: ● Cath Bryson, head of membership; ● Patricia McLauchlin, deputy manager; ● Stephanie Snowden, practising certificates leader; ● Gillian Ozer, administration leader. Gillian is also supported by three membership coordinators: ● Lisa Thomson; ● Lorraine McIntosh; ● Liz Conlon. Q: How many members does the Profession have? A: We currently have 23,425 members, 14,164 of whom are based in the UK and 9,261 overseas. The membership has grown by nearly 7,000 in the past seven years. Q: What other areas does the membership team deal with? A: In the past year, we have dealt with around 6,500 phone calls and 35,000 email enquiries, as well as 2,232 student admissions in the 2011/2012 year. We also update information relating to contact details, reinstatements,
resignations, transferring membership status, mutual recognition and the list of actuarial advisers. Q: When does the CPD year run for a category 2 member? A: The CPD year runs from 1 July to 30 June each year for category 2 members. All Fellows and Associates should retain CPD evidence for verifiable events for two years in the event that they are selected for th CPD monitoring. C Q: Q How can a member become partially b regulated? r A: Partial regulation is available to overseas Fellows and Associates who are also members at the same level of another anothe organisation, which is, in i turn, a full f ll member b of the International Actuarial Association (IAA). They can then elect that body to be their primary regulator, thus being partially regulated by the UK Actuarial Profession. If a member would like to apply for partial regulation, they must meet the criteria in the certificate of eligibility, complete and return this to the membership team, together with proof of membership with their primary regulator. Ideally, this should reach us any time after May but before the
NEWS IN B RIE F Claim CPD through our new online audio and video archive In response to member feedback, a growing number of events were recorded in 2012 and are now accessible at your convenience, through the audio and video archive on the Profession’s website. Members are able to claim CPD for a number of these recordings. Further information is outlined in the CPD for online events document on the Profession’s website. Remember to visit regularly, as 2013 will see the addition of further event recordings to this archive. Access the audio and video archive at bit.ly/WoDpIY
FORT HCOM IN G E V E N TS Panel discussion: a survival guide to being an actuarial student Are you a student who has entered the actuarial profession in the past two years, or are you currently in the final year of an actuarial undergraduate or post-graduate degree? If so, please join us on 21 February at Cass Business School for this interactive discussion. The Actuarial Network at Cass (TANC), in association with the Institute and Faculty of Actuaries, is proud to present ‘A survival guide to being an actuarial student’. A panel of recently qualified actuaries of the Institute and Faculty of Actuaries and employers from each of the main actuarial fields will be giving you practical top tips on: ● maintaining a healthy work/life/study balance; ● effective studying while working; ● how to be a good worker – from top student to top employee. For further information and to register, visit bit.ly/S3vovB
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Service with a smile: practising certificates leader Stephanie Snowden (left) and administration leader Gillian Ozer (right) subscriptions become due on 1 October. The final deadline for such applications is 31 December. Q: What is the timeframe when renewing a practising certificate? A: Practising certificate applications must be received by the membership team at least 21 days before the current certificate expires. If an application is late, a 25% fee is applied to the cost of £860. Members should also be aware that during the next five years we will be phasing in financial and criminal reference checks. If this is required with their renewal, the member will be contacted in advance. Q: When is the annual subscription due? A: The subscription year runs from 1 October to 30 September each year. Subscriptions become due on 1 October and should be paid by 31 October to avoid a surcharge. A 10% surcharge is added on 1 November to any unpaid subscriptions. If a subscription is still unpaid at 1 December, a further 10% is added. If no payment is received by 31 December then the membership is defaulted. Q: How do you see the service that we offer members evolving over the next year? A: Student admissions will be administered by our colleagues based in Oxford from the first quarter of 2013, so this will allow the team to provide an even better service. We would like to spend more time getting to know our members and understanding their needs, so that we can ensure we are providing them with the first-class service they deserve. The membership team can be contacted at
membership@actuaries.org.uk. Any practising certificate queries can be sent to practising.certs@actuaries.org.uk
THE ACTUARY • January/February 2013 www.theactuary.com
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‘Engaging with employers’ CPD briefing: attendance up by 100% On 22 November 2012, the Institute and Faculty of Actuaries held its annual briefing for continuing professional development (CPD) co-ordinators at Staple Inn Hall, London. The theme of this year’s event was ‘Engaging with employers – how to make our actuaries the best they can be’. The event was a great success and enabled one of our key stakeholder groups – employers of actuaries – to share their views and hear about developments and opportunities. Attendance this year was up 100% year on year and included almost all of the UK’s largest employers of actuaries. Some of the highlights included: a session entitled ‘What you asked us to deliver in 2012 and what we have achieved for you’; a talk on ‘Professionalism and accessing the conflicts of interest toolkit’; a vision for the future,
including improvements to the website and the virtual learning environment; plus an update on online access to sessional meetings and plenaries and ways in which employers can use these to help members gain CPD. The morning was not just about listening and concluded with a number of lively, open discussions on subjects including: developing the role of the CPD co-ordinator as a key stakeholder group; horizon scanning for hot topics and excellent CPD events; making our residential conferences the best they can be; and making volunteering for the Profession more valuable to employers. The feedback from the event was positive. One delegate said that the briefing “helps CPD co-ordinators [for employers of actuaries] to feel engaged in developments and processes going forward”. Another described the
briefings as a “useful tool to meet other CPD co-ordinators and to get a feel for what development opportunities are out there”. To view the full feedback report, please contact your CPD co-ordinator. If you would like to check whether your organisation has appointed a CPD co-ordinator, or if you have ideas on how we should develop the role of CPD co-ordinators, please contact volunteer engagement manager Debbie Atkins. Email debbie.atkins@actuaries.org.uk
LOOKING FORWARD TO 2013 Conference programme 2013
Upcoming events
Health and Care Conference 15-17 May 2013
GIRO Conference 2013 8-11 October 2013
Conflicts of Interest 27 February
Celtic Manor, Newport http://bit.ly/10ztfgb
EICC, Edinburgh http://svy.mk/WJg1Fn
http://bit.ly/X7VWZb
Pensions Conference 5-7 June 2013 Celtic Manor, Newport http://bit.ly/UQzV1s
Life Conference 10-12 November 2013
6 March http://bit.ly/SKBpit
Highlights of Life Conference 2012 7 March Edinburgh http://www.bit.ly/SKCkiO
14 March
EICC, Edinburgh http://svy.mk/W75qFZ
Sponsorship opportunities
Risk and Investment Conference 17-19 June 2013
Momentum Conference 4-6 December 2013
The Grand Hotel, Brighton http://bit.ly/SKDj2t
Celtic Manor, Newport http://svy.mk/UQymk7
are available, contact the event management team for further information: eventmanagement@ actuaries.org.uk
London http://www.bit.ly/VKsaOW
Call for speakers now open – be part of the conference programme for 2013
January/February 2013 • THE ACTUARY www.theactuary.com
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News Industry news@theactuary.com
Watchdog to examine competition in defined contributions market The Office of Fair Trading has launched an investigation to find out whether defined contribution workplace pension schemes are set up to deliver the best value for money for savers The competition watchdog said its study had been prompted by the introduction of auto-enrolment, which is expected to see an additional six to nine million workers enrolled in a workplace pension scheme by 2018. It is exploring whether competition will work in the best interests of new savers to deliver low-cost, high-quality schemes, with a focus on value for money and the size of the pension that savers end up with when they retire. Mary Starks, senior director of OFT’s services, infrastructure and public markets group, said: “The UK workplace pensions market is set for rapid growth and change over the next six years, in particular with the introduction of automatic enrolment. It is important that these savers get a good deal. “We want to take a look at the market now to ensure that providers are competing to offer the best possible deals, and that the choices made by employers mean that employees are saving into good pension schemes for their retirement.” For more on this story, visit bit.ly/WhaSFX
Women’s car insurance prices already up as gender-based pricing ban takes effect Towers Watson figures reveal an average 16.4% rise across the UK over the final three months of 2012 as insurers adjusted policies ahead of the EU Gender Directive The consultant’s latest car insurance price index, published in conjunction with price comparison website Confused.com, shows that between the end of September and the end of October 2012, the average quoted insurance premium for 17- to -20-year-old women increased from £1,707 to £1,986 a year. For men within the same age group, it fell by an average of 10.7% over the same period, down from £3,314 a year to £2,960. The ban on gender-pricing for insurance products under the EU Gender Directive took effect on 21 December, but Duncan Anderson, head of pricing and product management at Towers Watson, said the figures showed insurers were taking action ahead of time. “With implementation lead times, insurers began taking steps to average out premiums to produce gender-neutral prices. There is a lot of jostling for position going on at the moment, which is likely to carry on until individual insurers have a clearer view on how the market as a whole has reacted to the gender ban.” A particularly significant shift in pricing was seen in Northern Ireland, where 17- to -20-year-old women’s premiums increased by an average of 21.8% between October and December. During the same period, costs for men of the same age fell by 6.9%. Similarly, in outer London, women’s premiums in that age group rose by 18.4% while for men they fell by 9.8%. For more on this story, visit bit.ly/U0h5b7 l
MORE BREAKING NEWS ONLINE Visit www.theactuary.com for breaking news and to register for weekly news alerts
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State pension to be simplified Plans for a single, flat-rate state pension, which could be introduced by 2017, have been announced by pensions minister Steve Webb. The state pension will be simplified to a single payment of £144 a week. Currently, a basic state pension of £107.45 can be topped up to £142.70 via means-tested pension credit or the second state pension. The ability to contract out of the second state pension for defined benefit pension schemes will be abolished. bit.ly/USGLUn
Plans for clearer pension charges Some of the UK’s leading pension providers have reached an agreement to ensure “consistent and straightforward” disclosure of charges and costs to employees in workplace schemes. So far, 14 firms have agreed to take part in the initiative. These include Aviva, Axa, Friends Life, Prudential and Zurich Assurance. bit.ly/13IfKJS
RPI to remain unchanged The National Statistician has decided against a change in the way inflation is calculated that could have reduced some pensioner incomes by thousands of pounds. It had been anticipated that the Retail Prices Index (RPI) would be brought more in line with the slower-rising Consumer Prices Index. But it will now continue to be used to uprate private-sector pensions and index-linked bonds. bit.ly/TMxuji
Eurozone insurers’ profits down by 12% in two years Profits for eurozone insurers are expected to begin a slow recovery this year, but they will still be less than half their 2007 peak by 2016, Ernst & Young has said. According to the consultancy’s latest financial services forecast, poor investment returns and the impact of the recession on business growth meant insurers’ profits fell by an estimated 5% last year. This follows a 7% fall in 2011. Andy Baldwin, financial services leader for Europe, Middle East, India and Africa at Ernst & Young, said: “Insurers cannot rely on investment returns. The forecast is for interest rates to be pegged at around 0.75% until at least 2017, and the eurozone is forecast to face a ‘lost decade’ of low growth. Many insurers will have little choice but to consolidate.” Life insurers have been hit particularly hard by the crisis and, with the working-age population declining and personal income growth expected to be just 1.5% this year, Ernst & Young expects life premiums to increase by just 0.5% in 2013. This follows a cumulative fall of 8% during 2011 and 2012. The firm has forecast that the eurozone economy will contract for the second consecutive year in 2013. As a result of this, it expects non-life premiums to increase by just 1.8% this year and 1.9% in 2014. This compares with a historic average of 6.2%. For more on this story, visit bit.ly/UCz99K
Regulator consults on new approach to DC pensions The Pensions Regulator has set out what it plans to do to ensure that defined contribution pension schemes deliver the best possible outcome for savers under auto-enrolment. A raft of documents published for consultation aim to establish a new regulatory framework for the governance and administration of DC schemes. These include a new code of practice, accompanying regulatory guidance and a regulatory approach document. Both the code and guidance are underpinned by the regulator’s six principles and an updated version of the 31 quality features representing the standards and behaviours trustees must attain. Displaying these features will help trustees to show compliance with legal requirements and incorporate best practice. Bill Galvin, chief executive of The Pensions Regulator, said: “This will give employers reassurance about their choice of scheme.” For more on this story, visit bit.ly/VkGayo
THE ACTUARY • January/February 2013 www.theactuary.com
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› GENERAL INSURANCE
NEWS ROUND-UP
Insurers see Solvency II delay as chance to prepare According to a PricewaterhouseCoopers survey, 68% of insurers have reduced their Solvency II implementation programmes following expected delays to Europe’s proposed capital regime. The majority of insurers surveyed now expect Solvency II to fully come into force in 2016, and not 2013 as originally timetabled. However, the majority of insurers welcome the delay, as 58% of those surveyed said they would not be ready to submit their first Solvency II quarterly return by 2014. In December, The European Insurance and Occupational Pensions Authority (EIOPA) said it will now publish guidelines for national regulators on how they would proceed with Solvency II. The regulatory body, which is responsible for giving technical advice on Solvency II, favours a phased implementation and wants national regulators to have certain aspects of Solvency II in place from 1 January 2014, including the Own Risk and Solvency Assessment, pre-application of internal models, and reporting to supervisors.
Better whiplash diagnosis will aid genuine claimants, says ABI The Association of British Insurers (ABI) and the British Insurance Brokers’ Association have responded positively to government plans to tackle the rise in whiplash claims. The UK’s Ministry of Justice (MoJ) launched a consultation in December on measures to bring down the number and cost of whiplash claims, including speculative and fraudulent applications. James Dalton, head of motor and liability at the ABI, said that whiplash claims were the “fraud of choice” and add an extra £90 a year to the average motor insurance premium. “More effective diagnosis of whiplash will help genuine claimants get paid out quickly and reduce the scope for fraud,” he said. The MoJ intends to create new independent medical panels to improve diagnosis of whiplash injuries and an option to allow more whiplash cases to be challenged in the small claims court. However, the Association of Personal Injury Lawyers said that the proposal to force more personal injury victims to use the small claims court could “cripple” access to justice for vulnerable people.
Interest rates fuel cat bonds high The catastrophe bond market grew in 2012, approaching the record levels seen before the 2007 financial crisis. According to Swiss Re, new issuance levels in 2012 are expected to be US$5.8bn (£3.6bn), bringing the value of outstanding bonds to above US$16bn (£10bn). This compares with new issuance of US$4.6bn (£2.9bn) in 2011. At its annual insurance-linked securities presentation in London, Swiss Re said that the market in 2012 had been very active, with a total of 26 deals compared with 23 in 2011. Low interest rates and uncertainty in financial markets will foster further capital inflows into the cat bond market next year, keeping demand high, it said. Meanwhile, RMS indicated that two Swiss Re catastrophe bonds would be a total write-off for investors if insured losses from Superstorm Sandy reach US$25bn (£15.6bn).
GETTY
S&P downgrades as recession bites In December, Standard & Poor’s (S&P) reduced Axa Group’s financial rating from A to A- with a “stable” outlook. RSA’s rating was re-affirmed at A+, but the outlook was changed to “negative” from “stable”. For the Axa downgrade, uncertain investment markets, low interest rates, and the economic recession in the eurozone were cited as likely to dampen earnings and growth. Axa has taken a number of strategic actions, such
as focusing on less capital consuming products and emphasising cost and capital efficiency. For RSA, the move from a stable to a negative outlook reflects a decline in long-term interest rates to near-historical lows, which led S&P to revise down its earnings expectations for the group until 2014. Low interest rates, if prolonged, would put pressure on RSA’s capital adequacy and earnings, which are trending downwards. S&P said that it would lower RSA’s ratings if the capital adequacy measured by its capital model does not materially improve.
Storm costs rage but rate rise slows Global insurance rates continued to rise in the fourth quarter of 2012, but at a slower rate than in the previous quarter, according to the Marsh Risk Management Global Insurance Index. This was despite the mounting cost to the insurance industry of Superstorm Sandy, the broker said. According to Marsh, the average rate change at renewal was a 1.2% increase in the fourth quarter, compared with 1.4% in the third quarter. While property rates continued to rise, the rate of increase flattened for the second quarter in row, it said. Rates for financial and professional lines continued to rise at an average 2.2% year-on-year.
LARGE LOSSES
losses from Super Typhoon Bopha, the strongest US$822m Estimated typhoon to hit the Southern Philippines since 1990
Superstorm Sandy – 29-30 October 2012
Super Typhoon Bopha – 2–5 December 2012
In December, RMS said that it anticipated insured losses to be within the range of US$20bn to US$25bn (£12.5bn to £15.6bn). The losses were estimated at US$16bn (£10bn) commercial, US$8bn (£5bn) residential and US$750m (£469m) motor. These estimates exclude the National Flood Insurance Programme, public buildings, the Mass Transit Authority, contingent business interruption and watercraft. The last two categories are thought likely to add several billion dollars to the ultimate insured loss.
Bopha made landfall on the Philippines as a 260kph (160mph) Category 5 typhoon after crossing Palau. It left 1,901 people dead or missing and injured 2,666 others. According to the Philippines National Disaster Risk Reduction and Management Council, Bopha caused catastrophic damage in the provinces of Davao Oriental and Compostela Valley. Losses were estimated to be US$822m (£514.1m), although insured losses will be significantly lower because of low insurance penetration.
MORE GI NEWS ONLINE For further GI news, visit www.theactuary.com/news/
January/February 2013 • THE ACTUARY 15 www.theactuary.com
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If you have any newsworthy items for these pages please email social@theactuary.com
News People & Society
infectious joy, I believe the richest resource Uganda has is its own people; in the midst of abject poverty, deprivation and sickness, the Ugandan people are bursting with life and full of hope.” As a testament to this resilience, Andrew has set himself the challenge of running a marathon every month during 2013 to raise as much money as possible through sponsorship. Please visit www.12in12forISIS.com for more details
Invest in the vest
Running for their lives Last September, Andrew O’Brien took part in the annual ISIS Foundation trip to Kiwoko Hospital in rural Uganda. From humble beginnings as a clinic under a tree, it has since grown into a 25-acre compound servicing a population of 500,000 people and offering a wide range of medical services. Patients contribute to the costs of their treatment, but in a rural area with much poverty this is often not possible. The ambition is that no patient should be turned away and that the shortfall in the annual budget – currently around
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£150,000 – is made up from charitable contributions. The ISIS Foundation is one of the organisations that provides support to the hospital. Andrew describes the trip as life-changing and was inspired by the strength of character and determination of the people he met. “Everyone at Kiwoko made a deep impression on me,” he says. “Ugandans are some of the warmest and friendliest people I’ve ever met and make you feel special and appreciated. Full of
Every month next year, one lucky person will be given the chance to have a picture of their choice displayed on Andrew O’Brien’s running vest for that month. This could be an image or design, your profile photo, maybe a logo, a motif or even a catch phrase, slogan or proverb – be as creative or imaginative as you like. Andrew pledges to wear your creation on his vest for that month’s marathon as well as during his training for the whole month. If you’d like to send Andrew your picture ideas, he’d be delighted to display these on his website. Email andrew.o’brien@
aspen-re.com Like Andrew’s Facebook page www.facebook.com/ ISIS12in12 and each month you will be automatically entered into a prize draw, with one winner selected at random each time. It takes only seconds to enter and by doing so you will be supporting a very worthy cause.
New year honour for Llanwarne
Charity award: call for nominations
Government Actuary Trevor Llanwarne has been recognised for his services to the actuarial profession and public finances in the Queen’s New Year Honours List. Llanwarne, who has held the post since 2008, was one of just seven people in this year’s list to be appointed as a Companion of the Order of the Bath. The accolade also recognises his services to public-sector pension reform.
Each year the Worshipful Company of Actuaries presents the Phiatus Award to an actuary who has made an impressive contribution to charity. Nominations are now invited for 2012 and should be sent to the editor of The Actuary. The award is not simply for fundraising – although we do want to hear about impressive fund raising efforts – but will recognise all forms of charitable work and activity. Please do send through your nominations – we want to hear about and encourage actuaries in their work for charity. Send your nominations to editor@theactuary.com
THE ACTUARY • January/February 2013 www.theactuary.com
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New events series for London Market Student Group The London Market Student Group (LMSG) typically organises events where senior figures in the general insurance industry present directly to the next generation of actuaries, with the aim of improving their knowledge of the London market. This also gives actuarial students the opportunity to hear from and debate with industry leaders in a relaxed environment. Having heard from the guest speaker, there is an opportunity to network with students and newly-qualified actuaries working in general insurance. The location is usually a bar in the City, where complimentary drinks are commonly provided by the speaker’s firm. The most recent event was held on 17 October 2012, when the Counting House saw a packed room for Lloyd’s actuary Henry Johnson’s presentation on the actuarial function at the firm. Henry has worked at Lloyd’s for the past 11 years and during that time has seen its actuarial team more than triple in size from 12 to 37. LMSG also welcomed some new members at the event, which provided a great introduction to Lloyd’s. To learn more, go on the mailing list or if you are interested in speaking at or sponsoring an event, please contact LMSG’s chairperson at sarah.c.allt-graham@uk.pwc.com
Ever the Evertonian
WCA: On yer bike As part of its charitable fund raising activities, the Worshipful Company of Actuaries (WCA) is organising a cycle ride with a difference on Sunday 19 May. The ride will begin at Staple Inn and take in some of the sites made famous during the London Olympics last year before returning to Staple Inn for wellearned refreshments. All actuaries are warmly invited to take part, but it is not necessary to be an actuary or even to have a bike. Friends, colleagues and relatives are all most welcome to take part. And bikes can be provided by the London Bicycle Tour Company, which is supplying official tour guides for the event. The 27-mile route will head south across the river and pass through Greenwich Park (pictured), London’s oldest Royal Park and scene of Olympic Equestrian success, then along to Woolwich. Going
Marriages Congratulations to: (left) Andrew Collins and Hollie Kiteley, (both of LV=), who were married on 21 September 2012; and (right) Felicity Roat (Towers Watson) and Mark Lewis (Aon Hewitt), who were married in Norfolk on 17 November 2012.
back under the river, the final stretch will take a wide circle to Staple Inn via the Olympic Park at Stratford. All monies raised will go to the Company of Actuaries Charitable Trust, which offers grants to a range of charities supporting the young, disabled and needy. If you would like to express an interest in the ride or have any questions, please e-mail alan.smith@firstactuarial.co.uk or write to Alan Smith, c/o The Clerk, The Worshipful Company of Actuaries, Cheapside House, 138 Cheapside, London EC2V 6BW. Application packs will be available shortly.
Births Congratulations to Daniel Johns and his wife Lily Dieu (both of Prudential) on the birth of their daughter in November. Heidi Lyen Johns (right) is a sister to Toby. Deaths Roger Peter KNOWLES died recently, aged 62. He became a Fellow of the Faculty in 1976.
Bobby Riddaway of Capita recently took to the skies to help raise £700 for Everton in the Community. Thrillseeker Bobby, accompanied by Paul Foster, Leoni McManaman, Scott Black, Sean Robertson, Matty Chaloner, Adam Debazzi and Carena Duffy, completed a tandem skydive at Lancaster Airfield, which saw the participants jump from a plane at 14,000 feet to raise a collective £4,000 for Everton’s official charity. Lifelong Blues fan Bobby had to overcome his fear of heights to take part, but said it was definitely worthwhile. “I participate in a lot of charity events and noted the work of Everton in the Community. I moved south in 2005 and had to give up my season ticket, but I just wanted to give something back to the club. It was a fantastic day and I would recommend all fans to get involved.” To qualify, participants were required to pay a £70 registration fee and raise a minimum of £430 through sponsorship – a feat the father-of-two was only too happy to achieve for the club he loves and its official charity. For more information about fundraising for Everton in the Community, call 0151 530 5260
We would be delighted to hear from you if you have any newsworthy items for these pages. Please contact Yvonne Wan at social@theactuary.com
January/February 2013 • THE ACTUARY 17 www.theactuary.com
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SIAS Events
TUESDAY 26 FEBRUARY
The Retail Distribution Review: an introduction Alvin Kissoon and George Ealham, PwC Staple Inn, High Holborn, London WC1V 7QJ 5.30pm refreshments 6pm talk
PROGRAMME EVENT
The Retail Distribution Review (RDR) has already changed how retail investment products are sold. However, what does it actually mean, and how will it affect you? This talk aims to give an introduction to the RDR, including: ● Key features of the legislation; ● Impact of the RDR on the market; ● Risks and opportunities created by the RDR; ● The roles actuaries can play in the post-RDR landscape. This talk is suitable for students and younger members, and we would encourage you to attend. Refreshments will be served at 5.30pm, with the talk starting at 6pm. There is no need to register in advance for this meeting.
TUESDAY 26 MARCH
Longevity: is the ‘industry effect’ any more than a poor proxy for amount? Steven Rimmer, Towers Watson Staple Inn, High Holborn, London WC1V 7QJ 5.30pm
PROGRAMME EVENT
Can the differences in life expectancy between industry sectors be explained using standard rating factors or does the industry of the sponsor provide additional information? Put another way – does the ‘industry effect’ do anything more than reflect the underlying differences in pension amount and postcode? If we were to allow for an ‘industry effect’ in addition to the standard factors, would we simply be double-counting? In this talk, we will introduce the most widely used statistical technique to answer such questions – generalised linear modelling (GLM). We will address some of the challenges in using a member’s postcode as a predictive factor; consider the relative power of each factor to predict; and explore how the GLM method allows for correlations between predictive variables that would otherwise confuse the analysis. GLM is a key part of the CT6 examination and so this talk will be of particular interest to students who have recently studied CT6 or soon will. This topic will give an example of how the principles and techniques of GLM are used in practice and look at both the benefits of its use as well as the constraints. The talk will be aimed at a level where in-depth knowledge is not required and so we would encourage all students and younger members to attend. Refreshments will be served at 5.30pm, with the talk starting at 6pm. There is no need to register in advance for this meeting.
THURSDAY 21 FEBRUARY
Dance night 6.30pm Arch 2 room, Vodka Revolution, 1 America Square, Tower Hill, London EC3N 2LS
SOCIAL EVENT
Grab your cowboy hat, boots and checked shirt and ride on down to the SIAS barn dance event. Food will be provided to keep you yee-hawing throughout the night. So lasso your friends to get them involved, and get a ticket to the hoedown before it’s too late. Don’t worry if you have no previous experience, there will be a caller who will be shouting out the moves, and live musicians to keep you in time.
MORE EVENTS ONLINE For details of events, visit www.sias.org.uk
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SIAS IS ON TWITTER! Follow us on @SIAScommittee for latest news on meetings, socials and more!
SIAS IS ON FACEBOOK! Check out the SIAS Facebook page for photos from the latest social events
SHUTTERSTOCK
Email social@sias.org.uk to register. Entry is £10 per SIAS member and £12 per non-SIAS member. Once your place has been confirmed, payment needs to be received within five days.
THE ACTUARY • January/February 2013 www.theactuary.com
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On my agenda features@theactuary.com
MAN ON A MISSION SAM KESTEVEN
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Nick Mann meets Gabriel Bernardino, the man at the centre of the wholesale overhaul of Europe’s pensions and insurance regulation and supervision
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› CURRICULUM VITAE
Gabriel Bernardino was born in Lisbon, Portugal, and received his bachelor’s and master’s degrees in mathematics, statistics and optimisation from the Universidade Nova de Lisboa. His extensive international experience in insurance and pensions administration and public policy includes a spell chairing an EU Council working group responsible for negotiating the Solvency II proposal. He has chaired the European Insurance and Occupational Pensions Authority since it was established in 2011 and is responsible for the body’s strategic direction.
Building up a new European financial regulatory authority would be a challenging task at the best of times. Doing so when Europe has been hit by its worst financial crisis in decades is tougher still, but that’s the task that has faced Gabriel Bernardino since he was elected as the first chair of the European Insurance and Occupational Pensions Authority in January 2011. Add in the wholesale overhaul of major European legislation underpinning both the pensions and insurance sectors and it’s clear that, even with his 20 years of regulatory experience, the Portuguese-born Bernardino has his hands full. At the top of his to-do lists are undoubtedly those two major legislative changes. New rules governing Europe’s insurance industry, Solvency II, were originally expected to be implemented by January 2014, but the labyrinthine European political process has put paid to that, and concerns have grown over exactly when the new system will be put in place. Meanwhile, the pensions sector faces a revision of the Institutions for Occupational Retirement Provision Directive that has also raised hackles. Schemes, governments and business leaders question its potential impact on deficits, investment and, ultimately, growth. Faced with those challenges, and the resulting concerns, it would be understandable
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if Bernardino battened down the hatches in EIOPA’s Frankfurt headquarters and simply pushed out a series of consultation papers, edicts and reports. Instead, he speaks to The Actuary at the end of a lengthy grilling from key players in London’s financial services industry in the offices of Standard Life, high up on the 34th floor of St Mary’s Axe, better known as the Gherkin. Getting out there and speaking to the people who will be affected by EIOPA’s decisions is vital, Bernardino says. “I really want to understand the specificities of different members – what the problems are at a business and political level – and that’s why I’m always trying to travel around and meet people, because I think that’s fundamental,” he explains. “I think only by understanding them can we provide better solutions for Europe.” Finding a solution to the question of how to improve regulation of Europe’s insurance industry is not a new issue, but it is one that has been brought into focus by the financial crisis. The proposed Solvency II rules are an answer to “concrete issues”, Bernardino explains, as the current “really risky situation” has shown products and business models being challenged by the economic reality that the European Union is now facing. “The regime we have with Solvency I is definitely
not risk-sensitive, so we need to have much more risk sensitivity and capital requirements. That’s a fundamental principle and you don’t need to be an actuary to understand that... if you have more risk, you should have more capital.” Simple as those ideals might be, the process of making them a reality has been anything but. The European Commission’s original aim of implementing the Solvency II rules by January 2014 was stymied by delays in the enabling legislation Omnibus II. A series of postponements to a key European Parliament vote on the directive were followed in October 2012 by Bernardino writing to the European Commissioner responsible for the legislation, Michel Barnier, warning him of concerns among national supervisory bodies and calling for a “clear and credible” timetable for the legislation. Taking such a strong stance in public could seem brave – even foolhardy – for a regulatory body, but Bernardino says one of the “fundamental aspects” of building a supervisory authority is to have “sufficient independence to say difficult things”. “The political process is the political process, but I’m not a political party and my responsibilities are clearly defined,” he explains. “I think it is my responsibility to indicate to the political institutions that there are a number of elements that we need to
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On my agenda features@theactuary.com
“I’ve got no intention of proposing something that would mean 100% financing of all your liabilities and your capital requirements”
confront.” He’s insistent, however, that the letter hasn’t created any friction with the commission. “EIOPA is an independent supervisory authority, so there’s no problem – not on my side and not, I’m sure, on the side of commissioner Barnier.” With the European Parliament vote now postponed until June, Bernardino acknowledges that, under a “credible timetable”, it will be impossible to get full implementation of Solvency II before January 2016. “If you look at what needs to be made – standards, guidelines, all the processes, agreement on Omnibus II first of all – I think it will take until then to get started,” he says. But he’s under no illusions about the need to send out a “positive message” in the meantime – addressing the concerns of insurers who have already sunk large amounts of money into preparing for the new regulatory regime. To that end, last November saw Bernardino unveil plans for the “interim” implementation of aspects of Solvency II relating to governance, risk management, the actuarial function and transparency in a bid to keep the momentum behind the whole project. “We believe 2014 and 2015 can be used as an opportunity to enter into the system in a better way,” Bernardino asserts. “What we’re exploring, together with all our members – all the supervisors around Europe – is how we
can make possible a continuum towards the implementation of Solvency II, gaining experience from our side and also from the side of companies.” With countries already making moves to prepare their regulatory systems for Solvency II, Bernardino sees it as a win-win situation. “If everybody is doing this, let’s do it together, let’s do it in a consistent way,” he says. “What we don’t want is that when we then start to really implement Solvency II, we face a larger inconsistency than we’ve got today. That is unacceptable.” Solvency II will be keeping Bernardino’s in-tray full for a good few years to come, but it will be competing for space with the imminent revision of the legislation governing Europe’s workplace pensions, the Institutions for Occupational Retirement Provision (IORP) Directive. With the aim of introducing a risk-based regulatory and supervisory process for pensions, the goals of the revision are not a million miles from those of Solvency II. Indeed, the past year has seen the public debate around the IORP revision dominated by concerns that it will simply transpose the capital requirement rules being introduced for the insurance industry over to the pensions sector. In November, the UK’s Pensions Regulator said the plans could increase UK pension deficits by as much as £400bn, something pensions minister Steve Webb warned could have a “devastating” impact on the ability to invest in jobs and growth. Bernardino smiles wryly when asked whether he’s been surprised by the reaction to the plans. “I’ve been a regulator for more than 20 years, there are no surprises,” he says. “Let’s be frank, this is a very sensitive area and we totally understand that any kind of decision or changes in this area can have consequences.” He acknowledges that there are a “lot of numbers” being used by people, but adds that “we all know that pension liabilities are so sensitive to changes in options and parameters that you can easily have figures like zero to £400bn, like the recent report published here in the UK by The Pensions Regulator. Nobody mentioned that it could be zero, but it’s in the report”.
Bernardino also stresses that there are many stages to go until the revised directive becomes a reality, noting that the quantitative impact study held before Christmas to assess key aspects of the potential changes is “not the end of the story”. He also says that, when it comes to offering advice to the Commission on the capital requirements that should be placed on schemes, “I’ve got no intention of proposing something that would mean 100% financing of all your liabilities and your capital requirements within the holistic balance sheet – that doesn’t make sense. I’d prefer to have a situation where you make calculations in a more realistic way and then you have more flexibility on the supervisory side on how to deal with it.” Despite his conciliatory tone, Bernardino is in no doubt about the necessity for change. “We have a serious situation, and it’s not because of Solvency II or IORP II or whatever. It’s the economic reality. Many of these pension promises from pension schemes that were made 10 or 20 years ago were made in a completely different environment. We have a responsibility to confront this reality, because if we don’t do it, or the later we do it, the more problematic it will be.” Bernardino’s drive and commitment to addressing these issues is obvious. He knows it’s a “big challenge”, but describes it as a “privilege” to be involved in “building European supervision”. “It gives you a further level of difficulty but also a further level of motivation, and that’s something that EIOPA is clearly recognised for,” he enthuses. “To be a responsible, independent authority, but one with a vision and ambition for the future – that’s fantastic, because we all wake up in the morning with joy to go to work and feeling we’re doing something positive. It’s the best thing you can have in your life, to enjoy what you’re doing and feeling that what you’re doing is really making added value for all of us as a society and as human beings. That’s something that no salary in this world can pay.” a
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BENOIT MANDELBROT, SCIENCE PHOTO LIBRARY
“It wasn’t until the pioneering work of Benoit Mandelbrot in the 1960s that people accepted that stock markets are not memoryless”
Louis Bachelier is commonly known as the
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Figure 1: Autocorrelations of returns and absolute returns of weekly S&P500 data from July 1997 to October 2012. The autocorrelations are not significant for the returns but hyperbolic for absolute returns. Absolute returns are generally used as proxy for volatility.
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father of financial mathematics. In 1900 he came up with the idea of modelling stock prices using a random walk process or Brownian motion. Bachelier used this model to calculate the price of a barrier option 73 years before the famous Black Scholes option pricing formula. Bachelier’s work also predated Einstein’s work on Brownian motion in 1905, when Einstein solved French physicist Joseph Fourier’s renowned heat equation to come up with an equation for Brownian motion paths. Bachelier had worked out the distribution of the stochastic process underlying Brownian motion, called the Weiner process, but Einstein was unaware of Bachelier’s work. Brownian motion is an elegant representation of the stock market and the mathematics is well understood. However, the assumptions used to make Brownian motion work for stock returns are unrealistic to say the least. One of the most notorious of these assumptions is that successive stock market returns (log returns, generally) are independent and normally distributed. The stock market is thus assumed to have no memory, suggesting that a sharp decline one day will have no impact on stock market behaviour the following day. This is obviously wrong. An important implication of this memoryless property is that stock market data can be scaled. Thus we can scale daily or monthly data
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Modelling Financial time series data features@theactuary.com
Faisal Zai explains how long-term memory methods can better explain extended periods of market depression compared with the standard econometric methods commonly in use today
THE POWER OF LONG MEMORY structure indicates that asset returns are not independent. The absence of linear autocorrelations, as is the case for most developed markets, implies that the dependence must also be non-linear (see Figure 1). However, there is a debate as to whether this non-linear dependence is short- or long-term. Mandelbrot suggested that this non-linear dependence is long-term, but others have shown that it is short-term (Lo, 1991). Figure 2 shows how a stock price with long-term
Figure 2: Simulated stock prices for stock A with long-term dependence (grey) and stock B with no long-term dependence (blue). Stock A has a price range that tends to persist, owing to long-term dependence, whereas the price for stock B, which has only short-term memory, fluctuates quite a lot more.
memory may appear. Nevertheless, hyperbolic autocorrelations seem to imply some long-term dependence. Standard generalised autoregressive conditional heteroskedasticity (GARCH) models have exponential decay, and the general belief has been that these are unable to explain hyperbolic long-term decay when modelling absolute returns for instance (Maheu, 2002). The intuition for long-term dependence came in the 1950s from the work of the British
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characteristics to generate annual projections. This leads us to the ubiquitous ‘square root of time’ rule for scaling volatility. The argument implies that we can build ‘reliable’ estimates of return and volatility of annual returns by scaling up monthly, weekly or even daily data. It wasn’t until the pioneering work of Benoit Mandelbrot in the 1960s that people accepted that stock returns are not normally distributed and that stock markets and most asset return processes are not memoryless. There have been many studies investigating the effect of short-term memory in asset returns, using standard linear auto-regressive time series models. Short-term memory means that the autocorrelation function, capturing the correlation between successive values in a time series, decays exponentially, and usually quickly, to zero. Figure 1 highlights the short-term memory that can be observed in absolute stock returns. Many fund managers use the existence of short-term memory to try to predict stock returns as part of their ‘statistical arbitrage’ trading tool kit. Consequently, short-term memory is now less prevalent in developed markets but persists in many developing markets. When it comes to the standard short-term memory models, they are not quite good enough at explaining the dependence in asset returns. Take volatility clustering in asset returns – a feature that is widely seen even in developed stock market indices. This volatility
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if there is any form of dependence, whether it is linear or non-linear, short or long. For example, the Efficient Market Hypothesis, the Capital Asset Pricing Model (which derives all its assumptions from the Markowitz mean variance model) and the Black Scholes model are all invalid. Of course, this is not such a massive shock to the system now as it was when Mandelbrot first proposed these ideas. The prevalence of long-term memory in Mandelbrot explained that times of market many natural phenomena and in some asset exuberance were like floods, while times of returns highlights the importance of non-linear market depression resembled droughts. He risk. Traders with short-term trading horizons found the standard short-term dependence and those using technical charts focus mainly econometric models cannot explain the on short-term memory. However, long-term persistence of these periods of exuberance and memory can also be used to build optimal depression attributed to the decay process. trading strategies. Understanding non-linear Research has found the presence of long-term dependence, particularly long-term dependence in many asset classes since the dependence, is vitally important for actuaries seminal work by Mandelbrot. The dependence is who manage not only long-term financial risk particularly significant in emerging stock but also long-term non-financial risks, such as markets. There are statistical tests to check the longevity. If we are to be at the forefront of risk presence of long-term memory. One test checks management, we must take account of the value of the so-called differencing parameter non-linear dependence, particularly long-term in the fitted autoregressive integrated moving dependence, in the same way that Harold Hurst average (ARIMA) model, while another did when building the reservoir for the Nile. a calculates the value for the Hurst exponent of the data series using a modified version of the original analysis by Hurst discussed above. FAISAL ZAI Carlos Leon and Alejandro Reviez (BIS, No 58) used these measures to test a wide range of asset Faisal Zai is a founding principal and quantitative classes and found the presence of long-term specialist at Peraspera dependence in emerging markets, which are an Consulting Ltd important asset class for most equity managers. So what are the implications for non-linear dependence in asset returns? They are profound. All the concepts in ‘orthodox’ finance are wrong
River god: British physicist Harold E Hurst (left), when asked to design a reservoir on the Nile, dismissed the popular belief of random, independent water discharge for a long-term memory approach that revealed a regular pattern of flood and drought
NATIONAL PORTRAIT GALLERY / GETTY
physicist Harold E Hurst, also known as Abu Nile or father of the Nile to the Egyptians. Hurst was asked to design a reservoir on the Nile so the dams could protect the Egyptians in time of flood and the reservoirs could be used in times of drought. Instead of assuming random and independent water discharge, as was common among hydrologists at the time, Hurst decided to study the Nile’s flooding pattern by studying ancient records of the river dating back to the time of the Pharaohs. Hurst found that the flooding patterns were neither random nor independent. They displayed a pattern where periods of high (low) discharges were followed by years of low (high) discharges – not dissimilar to the story of Joseph in the Old Testament and the Koran, when Egyptians were faced with seven years of plenty followed by seven years of drought. Hurst found that the standard econometric short-term memory models at the time did not provide a good fit to the ‘Joseph effect’ in the data. He eventually came up with the concept of long-term memory to explain these patterns. Hurst observed similar long-term memory in many other natural phenomena, such as the pattern followed by solar spots in our sun. In the 1960s, Mandelbrot was teaching economics at Harvard and studying cotton prices. He also observed the presence of long-term dependence, similar to the pattern Hurst found in the Nile flooding. The connection was thus made to finance and
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Solvency II Profit and loss attribution features@theactuary.com
Solvency II will require an annual profit and loss attribution. Radu Popescu explores whether insurers can learn from investment bankers, who faced a similar requirement The profit and loss attribution (P&LA) is a crucial component of the control function in investment banking. It serves as an analysis of the booked profit and loss (P&L) and its variance, giving assurance that the material risk factors have been identified, and hence the exposure to them is known and understood. It has a strong link with the main market risk model, VaR, explained below. The P&LA is performed daily in investment banking. Let us consider how this is done for a homogenous book of trades that are marked to market on a daily basis. The first step is to identify all material risk factors, these being either variables or parameters. Changes in the variables are readily available from the market, either directly from stock prices, or implied from other prices, such as volatilities from option prices. Parameters will not change daily, and their values will be subjected to calibrations that will have an element of judgment involved. Examples of such parameters are correlations or parameters of a stochastic volatility model. The risk department will produce the Greeks, or sensitivities (usually first-order and sometimes second-order derivatives) to changes in risk factors, for all variables and for some of the parameters. We ignore P&L that is not market driven, like new trades or trade lifecycle events such as a change in the notional of the trade or a change in coupons and fees. There are two ways to do the P&L attribution: full revaluation or risk-based calculation. Full revaluation attribution is done as follows. The first risk factor is changed from the initial value to the next-day value, and the change in value of each trade is attributed to the first risk factor, with all the other risk factors having the initial value. Then the same is done for the second risk factor and so
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on. The sum of all these contributions is the explained P&L. A variant of this full revaluation method is to change the first risk factor, then move to the second one without putting back the value of the first risk factor to the initial value, and so on. The resulting explained P&L will equal the P&L, ie everything is explained. The problem with this method is that the attribution depends on the order in which the risk factors are considered and it is hard to justify the ordering in the first place, ie consider an option on a basket of 50 names. The risk-based approach is an approximation of the full revaluation. The Greeks are available from risk and the P&L attributed to a risk factor RF is then ∂V/∂RF * ΔRF+ ∂2V/∂RF2 * ΔRF2, assuming an order two approximation. This
used for model risk ties well with the calculation of Article 123: Profit management purposes. VaR. For each scenario – such and loss attribution Netting rules should be as a complete set of changes in applied carefully, so that one the risk factors – the change in “Insurance and reinsurance does not add across model value of the portfolio is undertakings shall review, at families. calculated. A one-year least annually, the causes and historical VaR calculation will sources of profits and losses involve the calculation of for each major business unit. What about 250 such scenarios. They shall demonstrate insurers? For the purpose of P&LA, how the categorisation of risk Some differences appear the scenario used for chosen in the internal model right away with the insurance calculation is for the actual explains the causes and industry P&LA target. change. Comparing the P&L sources of profits and losses. The one-year time horizon in attribution and the The categorisation of risk and insurance compared with the distribution of P&L calculated attribution of profits and one-day time horizon in for VaR purposes will give losses shall reflect the risk banking is the first big confidence that the material profile of the insurance and difference, because Taylor risk factors have been reinsurance undertakings.” approximations are usually considered and that the reliable over short approximation used for VaR is time intervals. correct (within the confidence interval Also, one has to decide if this should be expected). This is part of the backtesting done with the initial or final market data as analysis of the VaR model. the anchor point, ie should you bump up the Which Greeks are used in this risk factors from the initial to the final state, approximation depends on the trades. The or drop them down. This could yield very basic ones are Delta, Gamma, Vega, Theta and different results, as Taylor approximations Rho, while second-order cross derivatives could look very different, especially if market account for the cross effect between different conditions have changed. risk factors (for instance, Vanna, ∂2V/∂σ∂S, The presence of both insurance and market risk factors is also an interesting feature. which accounts for the cross effect between Structured products combining both could be the spot price S and the implied volatility σ). a challenge, but may deserve special attention A special Greek is θ, which accounts for the if they are designed to implement a specific time value decay, and the change in risk investment strategy and are hence essential factor is known. Note that VaR can also be from a risk management point of view. Pathcalculated using a full revaluation method, dependent products may require a refinement but computation can be expensive because of of the P&LA to the relevant time step and the number of scenarios to be considered. then adding up attributions to obtain the final Both methods including the two variants of result. Non-market-driven P&L will play an full revaluation method may be used at the important role over such a long period of same time to try to isolate some cross effects. time, when an important number of trade The full revaluation method will combine cycle events are bound to happen. into one risk factor all the contribution from Lastly, if done on simulations, the large Greeks associated with the same risk factor, number of points required to capture a 99.5% but not any cross factor ones. confidence interval will be at odds with the As a final remark, calculating reliable risk number of risk factors. A daily time step to factors for complex trades may be difficult. If capture path dependency, and hence some this is done in Monte Carlo, the workhorse of shortcuts, may be required. numerical calculations, the precision is lower Overall, the insurance industry will have to than on the calculation of the valuation itself. develop solutions that are robust, both in terms of calculations and management. a Link with model risk If successful, the unexplained P&L should vary around zero. Because of the numbers involved RADU POPESCU being both positive and negative, one should is a senior manager be careful about statements such as ‘90% of at Mazars the P&L is explained’. Limits can be decided for the unexplained P&L out of which some action to identify more risk factors should be started. If trades are not marked to market but are marked to model, which is the case for complex trades, the unexplained P&L could be
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Estimated years left for various commodities [1] Current global reserves divided by current annual consumption (assuming no growth in demand)
features@theactuary.com
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Earth matters: as the constraints on resources increase, actuaries must understand the implications
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Dr Aled Jones looks at the impact of earth’s dwindling resources on economic growth Resource constraints will, at best, steadily increase energy and commodity prices over the next century and, at worst, could represent financial disaster, with the assets of pension schemes effectively wiped out and pensions reduced to negligible levels. This is the bleak vision of the future emerging from a major report launched by the Actuarial Profession in association with Anglia Ruskin University on 17 January 2013. It also suggests that financial models fail to factor in the risks of climate change and resource scarcity, apart from a narrow focus in some insurance products related to direct weather events. It is imperative that actuaries recognise that dwindling resources raise the possibility of a limit to economic growth in the medium term and urgently dedicate research effort into the implications this has for their advice. How resource constraints affect the economy is complex and depends on a number of factors. Political and market responses to the challenges associated with resource constraints will have far-reaching consequences that need to be understood. To a large extent, these can be managed or, at the very least, influenced. Does the current ‘no growth’ economy in developed countries give us enough time to innovate, or does it distract us from our real long-term challenge? Will the increasing cost of resources, the effect of climate change and the scale of biodiversity loss result in investment into new methods of doing things, or will it merely increase investment into business as usual? Will any individual, organisation or sector take responsibility for managing a transition to a new economic paradigm or a new technological revolution?
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Comparison of projections from The Limits to Growth 1972 model and real-world data [2] Chart Sources: Meadows DH, Meadows DL, Randers J. and Behrens III, WW (1972) (Linda Eckstein)
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is a director at the Global Sustainability Institute, Anglia Ruskin University
Historical Trend Non-renewable resources remaining
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Will society or physical events force us to accept this responsibility in time, or will we avoid it until it is too late? Modelling such a high-impact set of issues is critical – not just for actuaries but also for society as a whole.
Economic growth The gross domestic product (GDP) measure of growth was developed by Simon Kuznets in the 1930s, when the US was trying to address the Great Depression. The rising role of government in the economy led to an increased need for a comprehensive set of data for national economic activity. The use of GDP spread globally after the Bretton Woods Conference in 1944, when the International Monetary Fund (IMF) and World Bank were created. These institutions followed the US and UK in using GDP to guide their policy advice and investment choices. This is widely believed to have reduced the severity of business cycles and promoted the era of strong economic growth after the Second World War. In 1972, the Club of Rome produced a report called The Limits to Growth. This used systems dynamics theory and computer modelling to analyse the long-term causes and consequences of growth in the world’s population and material economy. Twelve scenarios illustrated how world population and resource use interact with a variety of limits. In every realistic scenario, the model found that these limits would force an end to growth, or even a collapse, some time in the 21st century. The report attracted significant controversy and its scenarios were rejected. However, the path taken during the past 40 years by the measures modelled corresponds worryingly well with the projections.
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Even without resource constraints, it has been argued that we have already entered a period of low economic growth, and the current economic crisis has reinvigorated the debate on how society should react. Opinions can be grouped around four broad themes. 1) Growth is the solution Economic growth brings with it technological innovation that would bring about the required changes to meet resource constraint challenges. 2) Green growth By examining and changing indicators of growth to be more aligned with resource constraints and climate change, global economic development would more naturally develop the required solutions to global challenges. 3) End of growth The finite size of the planet combined with the fact that the economy is now operating on a world-wide scale means that growth cannot continue and must stabilise to remain within global boundaries. 4) Beyond the limits Resource limits and/or climate change have been ignored for too long and the global economy and population are now too large to be supported at current rates of consumption. A long-term decline is inevitable.
Effect on actuarial assumptions If economic growth is limited by resource constraints, this could be reasonably expected to significantly affect future financial and demographic outcomes. As such, the assumptions that actuaries use should take into account a number of potential developments. Reduced economic growth caused by resource constraints and reduced confidence. Reduced access to many commodities, hence increased prices or lack of availability.
A series of price shocks caused by greatly reduced access. Reduced coordination and international security as countries compete for resources. Repression of investment returns as governments direct investment into sectors required to make the economy more resilient. Increased differential of investment returns in countries with varying starting points for resources, efficiency and debt levels. Increased bankruptcy as indebted countries, companies and individuals fail to make repayments owing to the lack of growth. Warmer temperatures and unpredictable weather caused by climate change. Increased social tension as inequality and hardships are exacerbated. Changes to life expectancy and morbidity caused by changes in temperature, access to resources or ability to afford medical care. Three broad categories are explored in more detail in the published report, namely discount rates (this includes interest rates and investment returns), inflation (including salary and prices), and demographic factors (mortality and morbidity). How society reacts will be a major determinant of outcome. For instance, the reaction of monetary authorities to increases in commodity prices will determine whether increases in commodities result in general inflation. Society will also need to invest more and consume less, and the way this is achieved will determine investment returns, both absolute and relative to wage growth. In certain circumstances, governments could intervene – either proactively or reactively – to address a threat that could constrain investment returns and wage growth. Resource constraints could lead to international tension, potentially reducing trade, economic activity or even threatening security. They will also have a clear impact on international investment, upon which many institutions rely. If resource constraints do provide a limit to economic growth, it is vital that these impacts are understood. a
REFERENCES [1] Data taken from BP Statistical Review 2012 (www.bp.com/statisticalreview) and David Cohen, ‘Earth’s natural wealth: an audit’, New Scientist, Issue 2605, 23 May 2007, pp 34-41 [2] Mark Strauss, ‘Looking back on the Limits to Growth’, Smithsonian Magazine, April 2012 (bit.ly/Smithsoniangrowth)
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Environment Climate change risk features@theactuary.com
The International Energy Agency (IEA) recognises carbon capture and storage (CCS) as a core component of a cost-effective strategy to limit global temperature rises to 2°C by 2050. However, the absence of viable risk management and insurance solutions is presenting a barrier to the development of CCS at scale in Europe. ClimateWise is a global insurance industry leadership group formed to drive action on climate change risk. This article describes the key findings of the recently published report entitled Managing Liabilities of European Carbon Capture and Storage.
Carbon capture is seen as a key part of the war on global warming, but that particular battle can’t be won unless insurers come up with viable risk management solutions. Chris Gingell reports
Carbon omissions
Shaft mine
1. Mining of fuel 2. Coal or gas-fired power station with CO2 plant
Open cast coal mine 1. Mining of fuel Gas field
3. CO2 transport by pipeline
Unmineable coal seams Saline aquifers Key Supercritical CO2 plume Buoyant liquid CO2 plume
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5. CO2 storage sites
Depleted oil and gas fields
WWW.SCCS.ORG.UK
4. CO2 injection
THE ACTUARY • January/February 2013 www.theactuary.com
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CHRIS GINGELL
is a deputy managing director of Willis’ Global Solutions Consulting Group. He is a member of ClimateWise.
The development of CCS at scale in Europe brings with it a new portfolio of risks, for which risk management solutions need to be sought. The insurance industry has an important role to play and, with some innovation, can provide part of the financial security required to manage the risks arising from the liabilities that CCS operators would face. However, some liabilities are likely to remain uninsurable and risk-sharing with the government will still be required.
How does CCS work? CO2 is separated from other emissions at power stations rather than being released into the atmosphere. The CO2 would then be transported, usually via pipeline, to a suitable reservoir for permanent containment. In the UK, the proposed sites are depleted offshore oil and gas reservoirs, into which the CO2 would be injected, mostly using existing oil and gas infrastructure. Total investment in CCS projects is expected to be between $2.5 and $3 trillion and to contribute 19% of the IEA’s overall projected reduction in CO2 emissions from 57 gigatonnes (Gt) to 14Gt per year. Aside from being good for the environment, the main incentive for companies to set up CCS schemes is that they would not have to surrender their EU allowances (EUAs) for CO2. This refers to the carbon credits traded under the EU emission trading scheme. One EUA represents 1 tonne of CO2 that the holder is allowed to emit. EUAs are a tradable instrument under the European Emissions Trading Scheme (ETS).
Risks CO2 is not a fundamentally dangerous chemical in a gaseous state. Unlike natural gas, it is not explosive, and it isn’t a direct pollutant such as crude oil. The EU CCS directive requires operators to have adequate financial security in place before the commencement of CO2 injection to cover the potential costs of mitigating a future CO2 leak from the store. Aside from the costs of bringing such a leak under control, the store operator would have to surrender its EUAs for the volume of CO2 lost, at the prevailing market price at the time of loss. This presents a serious hurdle for any would-be storage operators because the future EUA price is unknown. Potential liabilities are also of unknown value and are theoretically uncapped.
European Union Allowance
EU Allowances (EUAs) are tradable emission credits from the European Union Emissions Trading Scheme. ● Allocated to over 11 000 industrial installations across Europe. ● Each EUA gives the holder the right to emit 1 tonne of CO2. ● Exchange tradable or over-the-counter. ● Largest emissions trading market in the world. ●
The risks of a leak from a store are remote. The oil and gas reservoirs had previously held hydrocarbon reserves for many millions of years. The Department of Energy and Climate Change (DECC) estimates the most likely source of a leak to be from a previously abandoned well and the probability of a leak to be in the order of 1 in 10,000 to 1 in 100,000 over a 100-year period for a single storage site with six abandoned wells.
Estimated maximum loss The financial consequence of a leakage would depend on the flow rate, the duration and the prevailing EUA price. An estimated maximum loss (EML) scenario involving a 200m tonne leak in 2035 would require approximately £412m for the surrendered EUAs, at present value, based on the central carbon price estimate provided by DECC. In extreme scenarios, the drilling of a relief well could cost up to £100m. The ClimateWise collaborative group was challenged with solving the problem of how the insurance industry could provide risk transfer for these liabilities. The report concluded that insurance can and does have an important role to play as a tool to manage some of the risks arising from the EU CCS directive, even if some risks remain fundamentally uninsurable.
Key challenges Pricing – There is no historical loss data for this risk and there is a lot of uncertainty over future EUA prices. However, given the very remote probabilities involved, it is likely that pricing will be driven by the marginal cost of capital requirements for insurers providing initial capacity. Pricing levels will also have to be sufficiently commercial for both operators and insurers.
Available insurance capacity – Insurers would not be willing to assume an unlimited liability. Insurers are generally reluctant to retain commodity price risk. For example, a typical business interruption policy for oil and gas companies would usually be based on a pre-agreed price per barrel of oil. Exposures will grow over time as more CO2 is injected into the store. This means that, in the initial stages, less insurance capacity will be required. By the time the CO2 stores get bigger, the insurance industry should have a better understanding of the risk. Trigger – Leaks may not be identified straight away and could last for years. There are still mixed views on whether policies should be on a claim occurrence basis, or triggered by the timing of the EU demand for EUA repayments. Risk appetite – Given that insurers would not be able to assume an unlimited liability, any residual risk would fall back to the operator and hence onto the government. The government’s willingness to act as the insurer of last resort is a key decision for policymakers. Timing – CO2 injection would last for approximately 30 years at any given site, and then would require a further 30 years of monitoring. The CCS directive’s request to have financial security in place at the outset is clearly at odds with the insurance industry’s annually renewable policy cycle. The use of alternative risk transfer and capital markets was also investigated. Although capital markets may be more comfortable with the commodity price risk involved, the same fundamental hurdles mentioned above would still need to be overcome.
Conclusion CCS highlights the important role the insurance industry has in combatting climate change and how progress can be made following consultation with wider stakeholders. For actuaries involved in the energy sector, the whole CCS chain will represent a growing risk that will need to be understood from a pricing, capital and reserving point of view. The scale of investment involved in this growing sub-industry means that the insurance industry will see this as an opportunity for premium growth. a
REFERENCES [1] ClimateWise, Managing Liabilities of European Carbon Capture and Storage, 2012 www.climatewise.org.uk
January/February 2013 • THE ACTUARY www.theactuary.com
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Member interest group Climate change
Spotlight In the first of a series of occasional articles highlighting new research and developments by member interest groups and other communities, Yves Guérard appraises a new report on climate change and its impact on insurance risk
A NEW ACTUARIES CLIMATE RISK INDEX “How climate change will affect society is a complex question. In addition, climate change – given its potential for systemic impact – can dramatically alter the risk management landscape. The Casualty Actuarial Society, the Canadian Institute of Actuaries, the Society of Actuaries, and the American Academy of Actuaries’ Property/Casualty Extreme Events Committee have responded to this emerging risk by collaboratively commissioning committees to recommend, support and perform research on climate change and assess the potential risk management implications for the insurance industry.” This is how the background for the research report Determining the Impact of Climate Change on Insurance Risk and the Global Community was described at a recent SOA meeting. The authors are three Canadian scientists involved in a range of environmental activities. One, Andrew Weaver, has been a lead author in the United Nations Intergovernmental Panel on Climate Change (IPCC). The credentials of the authors and the well-documented scientific contents make this report a highly credible source of information for all actuaries. The global actuarial community is indebted to the four
Hazard
the scientific background for the development of climate indices, namely the Actuaries Climate Change Index (ACCI) and the Actuaries Climate Risk Index (ACRI). The last three chapters are dedicated to the development of climate indices and risk assessment. The report proposes a definition of risk that “may be estimated quantitatively as the product of separate functions of hazard, exposure of assets and vulnerability”. The formula combines the three functions and would read:
Risk = C f(H) g(E) s(V)
where C is a proportionality constant. The variables H, E and V could reflect time and location. The formula is “modular in the sense that climate hazards, exposure and vulnerability are represented as separate North American actuarial factors”. In this form, the Actuarial Index can associations for investing be directly substituted for f(H). Insurance time and resources in companies could use that approach to derive commissioning this adjustments to their risk assessment process, report and in particular reflecting a consolidated expected impact of to the members of the climate change. As the conclusions point out, Climate Index Working “this would represent a significant advance Group for providing over existing approaches, which cover only a guidance to the authors. limited array of climate hazards, and are not The first part of the standardised to reflect the key role of climate report is a review of the latest variability”. The report concludes that further developments in climate investigation in any of these areas would reap science and the role of the IPCC. significant rewards in terms of estimating the It is educational in its approach threat of hazards arising from climate change and easy to read. on life, property, and natural capital. The report is targeted at an American I like to respond to that implicit appeal by audience, where denial of the anthropogenic suggesting two areas for further investigation: component of climate change is not rare. Thus ● Could the ACRI underwrite climate bonds the authors were careful in dealing with that would play a role similar to that of scientific uncertainty that has been misused to longevity bonds in hedging mortality risks? stall action, for example, about smoking, ● Developing the stochastic dimension for the chlorofluorocarbons and ozone depletion. They climate indices. a explicitly state that some existing level of uncertainty is not a reason for inaction, as THE FULL TEXT IS AVAILABLE AT expressed in article 3.3 of the UN Framework www.soa.org/Research/Research-Projects/RiskConvention on Climate Change (UNFCCC), to Management/research-2012-climate-change-reports.aspx which the US and 194 other nations are parties. More information on these issues is available on the The report argues that the use of insurance web pages of the Resource and Environment Group, a instruments as means of pecuniary protection is member interest group of the Profession www.actuaries.org.uk/members/pages/resource-andhighly resonant with this principle. environment-member-interest-group-reg-mig After reading less than half of the first four
Exposure
Risk
Vulnerability Coping capacity
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chapters, I was persuaded that even hard-core deniers would have been converted already. However, scientific data continues to accumulate for two more chapters, providing
Yves Guérard former secretary-general of the International Actuarial Association from 1997-2010. He was responsible for the creation of the IAA Environment Working Group, which he chaired until May 2012
THE ACTUARY • January/February 2013 www.theactuary.com
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What’s coming up in The Actuary?
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January/February 2013 • THE ACTUARY 33 www.theactuary.com
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Arts
THE DANCE O F D E AT H 34
Death, it comes to us all. Perhaps it is that inevitability that explains why, by and large, we carry on our day-to-day lives with little consideration for how and when our lives will end. A unique exhibition at London’s Wellcome Collection starkly confronts our often conflicting attitudes to death with over 300 objects ranging from harrowing illustrations of the sheer terror of war, to comical papiermache skeletons. The origins of Death: A Self-Portrait are unusual in themselves, with the exhibition drawn entirely from the collection of one man. Richard Harris, a former antique print dealer from Chicago, has amassed around 1,500 artworks and artefacts relating to the theme of death in just 12 years and the exhibition includes works from all corners of the globe, including Tibet, Mexico, India and Japan. Harris began his collection because of an interest in anatomy, and it’s perhaps as a result of this that the human skeleton – and the skull in particular – is present in the majority of the works in the exhibition. Divided into five rooms, the exhibition splits Harris’ collection into clear thematic areas, with the first – ‘Contemplating Death’ – juxtaposing obvious representations of death with the objects and belongings that we cannot take with us when we die. As is the case in other parts of the exhibition, the real interest lies in the more quirky, less conventional, objects – in this case, the calendar a chemical company used to market its wares to doctors at the turn of 20th century. The unusual use of skulls in the calendar appears all the more foolhardy with the revelation that compounds in their analgesics turned out to be toxic. Equally eye-catching is the massive Calavera or skull sculpture (above, right) that dominates the second room, ‘The Dance of Death’. By juxtaposing books and shanty towns, this three-dimensional collage by Argentinian collective Mondongo brings together seemingly random objects to cleverly articulate the impact of the traditional dominance of Europe and the US on South America. It’s a long way away aesthetically from the Nuremburg Chronicle, one of the world’s earliest printed books. Published in 1493, this
MARCOS RAYA / MONDONGO COLLECTIVE / RICHARD HARRIS COLLECTION
Nick Mann contemplates the universal, non-discriminatory element of life
THE ACTUARY • January/February 2013 www.theactuary.com
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The human skeleton and the skull in particular form the backbone of Death: A Self-Portrait Far left: Untitled (family portrait: wedding), Marcos Raya, Mexico, 2005 Right: Calavera, Mondongo Collective, Argentina, 2011
thick volume offered an illustrated history of the world, from biblical times to publication, but its relevance to the collection is its use of one of the earliest known versions of the dance of death. The frenetic revelry between skeletons and humans aimed to remind people of the universality of death and to warn them away from excessive materialism or vanity. A Japanese painting from the mid-1800s detailing two frolicking skeletons provides a more irreverent, less weighty take on this theme. Perhaps the most jarring, visceral reminders of the pain that is so often associated with death come in the works that dominate the exhibition’s third room, ‘Violent Death’. Francisco Goya’s set of etchings, ‘The Disasters of War’, will be familiar for many visitors, thanks to the artist’s status as one of the last of the Old Masters. They take an often minimalist, stripped-down look at a series of early 19th-century conflicts in Spain, and are particularly effective in showing the impact of war on the family unit. However, it is the 51 prints from German artist Otto Dix that are really likely to grab the visitor’s attention. As a machine gunner on the Western Front in the First World War, Dix witnessed the horrors of modern warfare first-hand, and his diverse series of etchings uses a variety of styles to articulate the death and destruction associated with one of the most significant conflicts of our age. Grotesque caricatures of dead men’s faces provide a grisly, visceral articulation of the loss of life, while shellshocked landscapes are a further reminder of the remorseless nature of the struggle. Conflict is also used to bring together the disparate works in the exhibition’s fourth room, ‘Eros and Thanatos’, which aims to articulate the eternal strain between our instincts towards life (Eros) and destruction (Thanatos). The naked body is particularly in evidence here, not least in John Isaacs’ bloody sculpture ‘Are You Still Mad At Me’? – offering a brutal dissection of a human body displayed on top of a flight cargo case. Less gory – but perhaps more disquieting – is ‘The Doctor, The Girl And Death’ – a semipornographic etching by Nazi-sanctioned Austrian artist Ivo Salinger. The work, from
1920, sees a naked young woman in the midst of a struggle between death and a surgeon. Some of the exhibition’s most unassuming – but ultimately most intriguing – objects are found in final room ‘Commemoration’. A series of ‘family portraits’ by Mexican artist Marcos Raya sees skulls transposed onto otherwise ordinary photographic shots, managing to be both comical and unsettling at the same time. A similar balance is found in a series of anonymous old photos showing unknown figures posing with skulls and skeletons in seemingly innocuous situations. With the passage of time, what may have seemed comical decades ago has now gained a disquieting feel, serving as yet another reminder that death is never far away. This room is also home to some of the exhibition’s most exotic works, not least an Indonesian grave-guardian or Tau Tau and a series of skulls from pre-Columbus Peru, as well as a wooden mash from Tibet. At the exhibition’s conclusion, there’s one final, highly effective reminder of the inevitability of mortality in the shape of a schematic produced by David McCandless to accompany the exhibition. Breaking down the total deaths in the 20th century according to cause, the clever graphic spells out several stark truths for the visitor, not least man’s ability to kill other men. While undoubtedly featuring a host of thought-provoking objects, Death: A SelfPortrait perhaps suffers from the inevitable limitations of being drawn from one man’s collection. The attempt to draw the works on show into five clear thematic areas fails on occasion, with some undoubtedly worthy and interesting items sometimes struggling to sit comfortably within these themes. That shouldn’t detract too much from the intriguing nature of many of the objects on display here, and being encouraged to re-examine our attitudes to death seems particularly appropriate at a time when our ageing population means that mortality is a consideration for an increasing number of people.
“The frenetic revelry between skeletons and humans aimed to remind people of the universality of death”
Plague, War, Famine and Death are harbingers of the Last Judgement in Albrecht Dürer’s The Four Horsemen of the Apocalypse, Germany, c.1497–98
Death: A Self-Portrait by Richard Harris runs until 24 February at the Wellcome Collection, 183 Euston Road, London NW1 2BE. Admission is free
January/February 2013 • THE ACTUARY 35 www.theactuary.com
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BOOK REVIEW
The Blind Spot, William Byers PUBLISHER Melville House Publishing ISBN 9781612191812 RRP £14.99
William Byers’ The Blind Spot is a fascinating examination of science and modelling. The Canadian mathematics professor explores the implications of the fact that we certainly do not, and probably cannot, have perfect understanding of many areas of our lives where we tend to assume that we do. The ‘blind spot’ of the title denotes that gap between reality and our understanding of reality. Rather than risk being tediously eulogistic in reviewing this excellent book, I thought it might be of more interest to offer an overview of Byers’ thesis in his own words: The existence of an inevitable ‘blind spot’ in our scientific theories, an unavoidable incompleteness in our description of reality … arises out of human consciousness itself, and is rooted in the biology of the brain … specific breakthroughs in science and mathematics have revealed this blind spot. Modern
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scientific thought is permeated with the discovery of the uncertain in various guises. Clearly, a philosophy of science must begin with what is real. However, science is not identical to reality; science is a description of reality. What we need to do is investigate the relationship between the description and the reality that stands behind it. The existence of that which is real but cannot be understood poses a major challenge to our usual way of thinking about the world and to our thinking about the relationship between human beings and the natural world. There are intrinsic limitations in our ability to pin down reality in concepts and symbols. Human beings have a basic need for certainty. Yet, as things are ultimately uncertain, we satisfy this need by creating artificial islands of certainty. We create models of reality and then insist that the models are reality. It is not that science, mathematics, and statistics
Many failures can, with hindsight, be traced back to some form of blind spot – in military, financial and scientific contexts. What this book does is to help us function in a world where such blind spots always exist. Byers ends in the foothills of the mountain that Nassim Nicholas Taleb, author of The Black Swan, scales more explicitly, and far more violently, in his latest book, Antifragile. To live well, we need to find a way to thrive on uncertainty. Byers’ final pages offer his solution: humility and personal engagement as opposed to abrogation or delegation to experts. In this way, “the world of the uncertain is the world of creative possibilities. It is the world of freedom, the world of wonder”. ● Matthew Edwards is a senior consultant at Towers Watson. He is co-author of the recent prize-winning SIAS paper ‘The Philosophy of Modelling’.
MORE ONLINE Latest reviews at www.theactuary.com/ opinion
GETTY
“People have allowed complex, mathematical-based formulas to obscure human intuition and judgment”
do not provide useful information about the real world. The problem lies in making excessive claims for the validity of these methods and models. Algorithms, mathematical formulae, and equations provide the promise of certainty. The aura that science provides – precision and objective truth – migrates over into the field of finance. If certainty in the financial world is unobtainable, it is still possible to package the illusion of certainty – the package consists of precisely those algorithms and equations, not science but the mythology of science, not certainty but pseudo-certainty. Quantitative reductionism is one of the main elements behind the financial crisis. People have allowed complex, mathematical-based formulas to obscure human intuition and judgment. The process of quantification in its attempt to ‘capture’ a given situation actually modifies that situation – it does not ‘capture’ reality so much as it creates a new reality. Many people will be surprised by the assertion that some things cannot be understood. These people inhabit what I will call the ‘culture of certainty’, imagining that science proceeds by totally mastering some particular bit of reality before moving on to the next bit in the way an army conquers foreign terrain. The ‘army’ in this case would be [human] rationality itself – this brings to mind a statement by the philosopher Abraham Heschel: “What characterises man is not only his ability to develop words and symbols but also his being compelled to draw a distinction between what is utterable and the unutterable, to be stunned by what is but what cannot be put into words.”
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At the back Coffee break
HAVE YOU GOT WHAT IT TAKES? Membership of Mensa is open to anyone who can demonstrate an IQ in the top 2% of the population. For information on IQ testing in your area, visit www.mensa.org.uk or call 01902 772771, option 1
puzzles@theactuary.com
Puzzles —
Go figure Mensa puzzle 530
PRIZE E PUZZL
—
What are the two missing numbers (in white)?
Mind the gap Mensa puzzle 531
On the right line Mensa puzzle 533
What letter is missing in this sequence?
Which word connects the following words?
E O ? R E X N T E N
BANK BOARD
PAPER
BOY BAG
Mix it up Mensa puzzle 532 Rearrange the missing letters to give two eight letter words
B C D F G H J K O P Q S U V W X Y Z INCITE KERNAL
?
STONE
Elementary! Bridge puzzle 29
Conquer the maze Mensa puzzle 534 What do the following words have in common?
CELLAR
SHUTTERSTOCK
LINKS
FLOWER MAZE
1. You pick up this lovely hand and end up in 6♦. After the lead of the K♠ and provided there are no 8-1 or 5-0 breaks, how can you guarantee your contract? 2. This time you have overbid to 7♦. After the K♠ lead, what are the approximate odds of making the contract?
♠854 ♥AK64 ♦108 ♣8632
N W
E S
♠A ♥ ♦AQJ97632 ♣AK97
Plan the play Bridge puzzle provided by David Lampert
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SOLUTIONS FOR DECEMBER 2012 L
P
DECEMBER 2012 theactuary .com
C O F M P E N D I P U Z Z L E S M 1 2 D A Y S C H R I O F S T M A S P U Z Z L E S
W
S
J
V
H
P
?
U
PAMELA NEIL
The winner of the Bumper Prize Puzzle was Paul Clare, who answered all 12 puzzles correctly The magazi
C
ACTUARY OF THE FUTURE
ne of the actuari
al profession
Day 1 Puzzling pressie
Day 7 Win by a nose
What letter should replace the question mark? ANSWER: Y. The first group of letters are eight places apart in the alphabet, the second group are six places apart, the third group are four places apart and the last group are two places apart.
Reindeers pulling Father Christmas’s sleigh pass through a three-mile-long tunnel on their way to deliver presents. From the tip of Rudolph’s nose to the end of the sleigh measures 110 yards. The reindeers and sleigh are travelling at 90 mph. How many seconds will elapse between the moment Rudolph enters the tunnel to the moment the sleigh clears the tunnel? ANSWER: 122.5
Prize winner: Alexander D’urso
Day 2 Bauble delight What should be the value of the bottom row? ANSWER: 82 a bauble = 16 a wreath = 20 a Santa = 30
= 86
Employer and area of work Aviva – international actuarial consultant, currently based in Paris.
Prize winner: Ordeal BJ Dube
= 96
Day 8 Waxing lyrical
= 100
Candles are lit throughout Advent and the stubs are saved to mould into new candles. Seven stubs are required to make each new candle. If there are 151 stubs, how many candles can possibly be made in total? ANSWER: 25
= ?? Prize winner: Anne Middleton
Day 3 Festive treats _ _ XXXX _
A sweet sauce
_ _ _ XXXX
Portable demonstration sign
_ XXXX _
A road
Prize winner: Mukunda Sanchal
What are the Christmas words? ANSWER: Star (word is CUSTARD), Tree (word is STREET) and Card (word is PLACARD).
38
What’s your most ‘actuarial’ habit? Using spreadsheets to plan my personal budgets.
running and have just completed my second marathon. My other passions are Ashtanga yoga, cycling and enjoying a glass of red and some cheese – working in Paris has its perks.
Alternative career choice? A yoga instructor. Tell us something unusual about yourself I can
223 ? 47 45
speak basic Nepalese.
Greatest risk ever taken? Giving up a career as
37 10
16
Prize winner: Mike Hooton
Day 11 Santa’s pie
7 6 ? 1 8 2 What number should replace the question 5 2 5 4 1 5 mark? ANSWER: Three. 4 3 8 14 Every sector in the bottom 8 9 10 11 half totals double its 3 12 opposite in the top half. 7 9
a chef to become an actuary – thankfully, it all worked out well.
What’s your most treasured possession? My grandmother’s violin.
What are your top three things to achieve in your lifetime? To run a marathon on every continent; travel to Mysore India and study Ashtanga yoga under Sharath; become fluent in French before I leave Paris.
Prize winner: Tony Hutchins
Day 12 Goodwill greetings
Prize winner: Joseph Achira
GOLD – 550
BLACK – 150
Day 6 Yuletide yodelers
SILVER – 56
PURPLE – 50
Rearrange the letters of ‘MY STRONGER GREEDY ELEMENT’ to give the title of a Christmas carol. What is it? ANSWER: God Rest Ye Merry Gentlemen
Packs of Christmas cards in various colours have sold as listed. How many packs of RED cards have been sold? ANSWER: 500. The Roman numeral values in each colour are totalled.
Prize winner: Alistair Meikle
Norton, Richard Dawkins, the Dalai Lama.
Prize winner: George John
What number should replace the question mark? ANSWER: 110
_ _ _ _ _ _ _
Name five guests you would invite to a dinner party? Stephen Fry, Hugh Laurie, Graham
How do you relax away from the office? I love
What are the highest and lowest numbers you can possibly score? ANSWER: 32 using divide, plus, minus and multiply. Minus 11 using divide, minus, multiply and plus
QUIET STEEL DRAKE SHAWL TREND CLOVE PRIME
not be the party we hoped for, but while we are here we might as well dance.
A car has travelled 100 miles at 60 mph. It started its journey with 8 gallons of fuel, but its tank has been leaking and is now dry. The car completes 40 miles per gallon. How many gallons of fuel does it leak per hour? ANSWER: 3.3
Day 10 Noel’s number
On each row place a letter that can be substituted for the fourth letter of the word to the left. When completed a place name will be read downwards. What is it? ANSWER: Lapland
What would be your personal motto? Life may
Favourite Excel function? Pivot tables.
Day 4 Seasonal sums
Day 5 Joyful journey
What motivates you? I love having a target to aim for, be it climbing a mountain, cycling across the country or running a marathon.
Day 9 Merry mileage
Prize winner: Mark Greenwood
Prize winner: Francis Reardon
How would your best friend describe you? Caring, committed, with a passion for travel.
If you ruled the world, what would you change first? I’d remove the stigma surrounding mental illness.
Do you know an actuary destined for greatness? You can nominate an Actuary of the Future by emailing
aotf@theactuary.com
SHUTTERSTOCK
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Sponsored by
Prize winner: John Small
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At the back Student student@theactuary.com
Student Jessica Elkin ponders on the chances of an actuarial amour
MATH + BUSINESS = HOT Once upon a time, a fair maiden seeking to find her heart’s true love decided to forgo the damsel in distress rescued from a tower by a knight in shining armour routine and advertise on a listings site instead. More convenient and efficient (ever a watchword in business transactions). A section from this listing reads as follows: “I’ve given a bit of thought to what kind of man I want to date, and I’ve determined that an actuary would be a good match for me.” Her explanation? “I love nerds. Actuaries know math in and out. Their analytical skills are top-notch. Now add to it that they need decent social skills to meet the professional communications requirements. In sum, actuaries are well-rounded business people who know how to write formulae.” The maiden goes on to extol the virtues of a man who uses annual leave to study, and reassures that she is independent enough to allow an actuarial student his own time to do so without distraction. Clearly, while not the most well-known profession, this actuarial lark has attracted some of the right attention. O happy day! There is, besides, one summarising line in bold type, which reads as follows: Math + Business = HOT. So, there you have it. Actuaries are Casanovas, the Don Giovannis of the business world. Brad Pitt armed with orange actuarial tables and a calculator. And, with Valentine’s Day looming, it’s good to know that as well as boosting our analytical, financial, business and communication skills, the exams lurking over our shoulder are also making us more appealing romantic prospects. Now hang on a minute, you may be
thinking, this is only one woman’s view. She could be a lunatic, or planning to lure in unsuspecting males to devour like a black widow spider or Estella from Great Expectations. But there are some examples of actuarial appeal in the media, and if it’s in the media then it must be true. Just like the tabloids.
Actuarial models Admittedly, there aren’t that many actual actuarial celebrities. But look at the fanciable nerdy types on television. Carol Vorderman has always had quite a following. Not to mention poster-boy Brian Cox and his expanding fanbase. So his area is physics, but it’s still an example of the growing popularity of the geek. More relevantly, there’s ‘The Actuary Song’ from the musical I Love You Because, which suggests dating practice based on formulae to help a character find love. You hear that? People are seeking relationship advice from actuaries. We’re so romantically gifted that Will Ferrell’s auditor character in Stranger than Fiction was dumped by his fiancée in favour of one of us. Ben Stiller’s colourless insurance actuary from Along Came Polly even managed to nab Jennifer Aniston. Actuaries on top!
Trouble in paradise Unfortunately, there is a caveat to all this rejoicing. The small
print of the listing that prompted this topic included: “Being able to fix either a car, computer or domestic appliance is appreciated. Must kill scary bugs. Couch potatoes will be denied. No jokes about figuring the probability that we’ll actually end up together. That’s a little too nerdy.” Ouch. Unfortunately, it seems as though you must be a fearless spider-and-moth terminator and resist the allure of all-day Friends on a Saturday to win the heart of yonder lady. The harshest part has to be the ban on romantic actuarial jokes, but presumably it does not stretch to those mathematical chat-up lines that we all groan at but secretly enjoy – ‘we’ being actuaries, not women, that is.
Let me be your integral All things considered, though, it’s looking good right now for actuaries and romance. And who knows what the future holds! If we can raise the profile of actuaries everywhere, think what could be achieved. Useful side effects might include having to deal less with “You’re an actor?” at dinner parties; attracting more bright young students to the profession; and potentially gaining access to more new areas of actuarial work. Obviously, those are just a bonus. If all this talk of enhanced passion in the life of an actuary is making you all enthusiastic about spreading the word, I suggest checking out the volunteering page of the Profession’s website. A few of the roles focus on raising awareness, particularly for young people considering career paths. It might even lead to networking opportunities and CV enhancement. Either way, it can only end well, right? Anyway, must dash – time to clear my desk to make way for flowers, cards and chocolates. I am an actuarial student, after all. a
ILLUSTRATION: PHIL WRIGGLESWORTH
January/February 2013 • THE ACTUARY 39 www.theactuary.com
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At the back Appointments peoplemoves@theactuary.com
Moves Martine Scott-Gordon (above) has joined Pure Search to lead their actuarial & risk practice. Scott-Gordon previously worked as an actuary at E&Y, GE Insurance Solutions and HBoS and joins Pure from a specialist actuarial recruitment firm, where she gained experience across all disciplines, with a particular focus on the life insurance market.
PwC has appointed Celene Lee (above) to its pensions advisory team. She was previously head of pensions at Barrie & Hibbert, where she led asset and liability risk modelling strategy and consulting for the pensions and asset management sectors. Prior to this, Lee worked at Hewitt Associates on projects including scheme actuary work. She is a former chair of the National Association of Pension Funds’ North London Group and is chair of the Institute of Actuaries’ Institutions for Occupational Retirement Provision (IORP II) working party.
40
Lucy Ledger (above) has joined Atkin & Co as scheme actuary and client manager. She will divide her time between the London and Solihull offices of the pension scheme administrator and actuarial consultant. Previously with KPMG, Ledger has supported both trustees and employers in funding negotiations, worked on schemes in the Pension Protection Fund (PPF) assessment period and advised clients on liability management exercises, PPF levy management, benefit changes and scheme mergers. Towers Watson has further strengthened the European management
mergers and acquisitions for the state-owned financial conglomerate. Prior to that, he held senior international development and actuarial roles for CDC’s insurance subsidiary, CNP Assurances. His earlier career included experience of both life and property and casualty insurance with Bacon & Woodrow in France and AXA in France and Italy. As part of Ernst & Young’s expansion of its risk and actuarial team, it has appointed Andrew Stoker (above) as a partner in the European Actuarial Services team. He will be based in London. Stoker was previously chief actuary at Lucida, a specialist buyout insurer.
David Martin (above) has been appointed a non-executive director to The Pensions Regulator by The Department for Work and Pensions. Martin has 40 years’ experience in the pensions industry, including 30 giving direct advice to trustees of occupational pension schemes. He was a partner at Mercer Ltd and its predecessor companies (1980- 2012). Martin is involved at a senior level with the Institute and Faculty of Actuaries. He is a vice-chair of the Professionalism Committee of the International Actuarial Association, and an officer of the Groupe Consultatif – a grouping of the European Actuarial Associations.
KPMG has appointed two principal consultants, to its life actuarial consulting team from Ernst & Young. Zaid Hoosain (above) is based in London, while Raj Balasubramanian (top right) is the most recent addition to the firm’s team of 15 life and risk consulting actuaries in Bristol. KPMG is also pleased to congratulate Gerard Callaghan (below) and Steven Gin (above right) on their recent promotions to director. Callaghan has a strong background in reporting and asset
liability management, while Gin’s background is in financial reporting and finance transformation.
Capita Employee Benefits has appointed Bobby Riddaway (below) to the new role of head of investment consulting. He joins from Buck Consultants.
New dean for Cass Business School team of its risk consulting and software division with the appointment of Julien Brami (above) as sales and practice development leader for its life insurance consulting practice in France. Brami joins from Caisse des Dépôts (CDC), where he was deputy group head of development and
Steve Haberman has taken the helm at Cass Business School, part of City University London. A Cass professor of actuarial science, he has been deputy dean of the school for 10 years. He takes over as dean from Richard Gillingwater CBE, who stepped down after six years. Professor Haberman will lead the implementation of Cass’s new strategic plan and guide the school as it prepares for the next Research Excellence Framework exercise.
THE ACTUARY • January/February 2013 www.theactuary.com
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www.theactuaryjobs.com
A P PO I N TME N TS To advertise your vacancies in the magazine and online please contact: Gill Rock +44 (0) 20 7880 6234 or gill.rock@redactive.co.uk
www.highfinancegroup.co.uk
Specialist Recruiters
PERMANENT GI ROLES UK Head of Actuarial & Specialist Projects
Chief Reinsurance Pricing Actuary
£120k - £180k + Bonus + Benefits, London
£120k - £155k + Bonus + Benefits, London
This leading General Insurer seeks an experienced Qualified Actuary to manage their Actuarial and Specialist Projects team. You should have a passion for people management and development and be looking to build influential relationships with external stakeholders. Previous managerial experience is essential. William@highfinancegroup.co.uk
Expanding Reinsurer requires a Head of Pricing to lead their Pricing division and grow the Actuarial function. You will report into the Chief Underwriting Officer who has a strong reinsurance background and ambitious growth plans. The right candidate will have Pricing experience and experience in Reinsurance is ideal. William@highfinancegroup.co.uk
Pricing & Capital Actuary
Syndicate Reserving Actuary
Up to £75k + Bonus + Benefits, London
Up to £85k + Bonus + Benefits, London
A reputable and growing London market insurer is looking for an experienced nearly / newly qualified Actuary. The successful candidate should have a positive and proactive working style and be able to use their initiative. Actuarial experience is essential, ideally within Pricing or Capital. James@highfinancegroup.co.uk
A specialist Lloyd’s syndicate requires an experienced newly qualified Actuary. You will take ownership for the Reserving across a number of lines of business, reporting directly to the Head of Actuarial. The role will suit someone who might be looking to break into the Lloyd’s market. James@highfinancegroup.co.uk
Syndicate Pricing Analyst
Senior Commercial Analyst
£40k - £60k + Bonus + Benefits, London
£45k - £65k + Bonus + Benefits, London
Opportunity for an experienced part qualified Actuary to join the pricing team of a market leading Lloyd’s syndicate, working closely with the Head of Pricing and liaising with Underwriters and other teams. The position provides a broad insight into the business as well as early responsibility and support from senior management. Chanelle@highfinancegroup.co.uk
This international General Insurer requires a commercially minded Senior Actuarial Analyst for their London team. Assisting management, you will gain exposure across pricing, reserving and capital modelling. Good exam progress and experience working within General Insurance is essential, ideally within the London market. Chanelle@highfinancegroup.co.uk
CONTRACT ROLES UK Pricing and Reserving Contractor
Risk Modelling Contractor
£800-£1000pd, London
£600-£900pd, South Coast
This established syndicate requires a contractor for 12 months to work across pricing, reserving and capital modelling. The role will report directly in to the Chief Actuary and work closely with the Underwriters. Previous London market experience is desired. William@highfinancegroup.co.uk
An experienced Actuary is sought by this Life Insurer to provide technical expertise and advice in Risk Modelling. You will develop a new group risk and capital model to be compliant with Solvency II and TAS requirements. Risk Modelling and Solvency 2 experience is crucial with qualified and part qualified Actuaries considered. Jack@highfinancegroup.co.uk
Capital Contractor
Actuarial Systems Implementation Manager
£600-£1000pd, London
£700-1000pd, South East
A small Insurer is looking for a Capital Modeller with a model building background who can bring new ideas to the table for a 6 month contract. The client wants someone with an experienced modelling background and a passion for creating ideas and solutions. Knowledge of remetrica or igloo will be considered. William@highfinancegroup.co.uk
An International Life Insurer seeks an experienced Actuarial Systems Manager to lead the development of an Actuarial Service Centre, responsible for the production of all actuarial processes. This role requires strong Prophet knowledge. Prior project leading experience is key. Jack@highfinancegroup.co.uk
Head of Actuarial - GI
JAMES KITT Consultant - GI
CHANELLE ROSENBAUM Consultant - GI
JACK SNAPE Life Interim & Perm
+44 (0) 207 337 8826
+44 (0) 207 337 1202
+44 (0) 207 337 8827
+44 (0) 207 337 8810
william@highfinancegroup.co.uk
james@highfinancegroup.co.uk
chanelle@highfinancegroup.co.uk
jack@highfinancegroup.co.uk
WILLIAM GALLIMORE
+44 (0) 207 337 8800
actuarial@highfinancegroup.co.uk January/February 2013 • THE ACTUARY 41 www.theactuary.com
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Appointments
KhZ >/ Ed^ Z '>K > ͵ E ^K Z t ƐƚĂďůŝƐŚĞĚ ŝŶ ϭϵϵϲ͕ ĂƌǁŝŶ ZŚŽĚĞƐ ŝƐ ĂŶ ĂǁĂƌĚ ǁŝŶŶŝŶŐ ƐƉĞĐŝĂůŝƐƚ ƌĞĐƌƵŝƚĞƌ ŽƉĞƌĂƟŶŐ ǁŝƚŚŝŶ ŶŝĐŚĞ areas of the Insurance and Finance sectors and is part of the Dryden Human Capital Group. We appoint ƉƌŽĨĞƐƐŝŽŶĂůƐ ŝŶ ĐƚƵĂƌŝĂů͕ ƌŽŬŝŶŐ Θ hŶĚĞƌǁƌŝƟŶŐ͕ ĂƚĂƐƚƌŽƉŚĞ ZŝƐŬ ĂŶĚ ůĂŝŵƐ DĂŶĂŐĞŵĞŶƚ͕ ĨƌŽŵ Ă ŶĞƚǁŽƌŬ ŽĨ ŽĸĐĞƐ ŝŶĐůƵĚŝŶŐ ŽƵƌ h< ŚĞĂĚƋƵĂƌƚĞƌƐ ŝŶ ƚŚĞ ŝƚLJ ŽĨ >ŽŶĚŽŶ ĂƐ ǁĞůů ĂƐ ŽĸĐĞƐ ŝŶ ƵƌŝĐŚ͕ DƵŵďĂŝ͕ ,ŽŶŐ <ŽŶŐ͕ ^ŚĂŶŐŚĂŝ͕ ^LJĚŶĞLJ ĂŶĚ EĞǁ zŽƌŬ͘
THE ACTUARIAL TEAM tŽƌŬŝŶŐ ĨƌŽŵ ŽĸĐĞƐ ŝŶ >ŽŶĚŽŶ ĂŶĚ ƵƌŝĐŚ ŽƵƌ ĐŽŶƐƵůƚĂŶƚƐ ƐĞƌǀŝĐĞ ĐƵƐƚŽŵĞƌƐ ĂĐƌŽƐƐ >ŝĨĞ͕ EŽŶͲ>ŝĨĞ͕ WĞŶƐŝŽŶƐ͕ /ŶǀĞƐƚŵĞŶƚƐ ĂŶĚ ,ĞĂůƚŚĐĂƌĞ ǁŝƚŚ Ă ƉŽƌƞŽůŝŽ ŽĨ ĐůŝĞŶƚƐ ŝŶĐůƵĚŝŶŐ /ŶƐƵƌĂŶĐĞ ĐŽŵƉĂŶŝĞƐ͕ ZĞŝŶƐƵƌĞƌƐ͕ ZĞŐƵůĂƚŽƌƐ͕ ŽŶƐƵůƚĂŶĐŝĞƐ ĂŶĚ ZĂƟŶŐ ŐĞŶĐŝĞƐ͘ tŝƚŚ Ă ƌĞŶĞǁĞĚ ĂŶĚ ŝŶĐƌĞĂƐĞĚ ĨŽĐƵƐ ŽŶ ƚŚĞ ŵĂŶĂŐĞŵĞŶƚ ŽĨ ƌŝƐŬ͕ ƚŚĞ ƌŽůĞ ŽĨ ƚŚĞ ĐƚƵĂƌLJ ŚĂƐ ŶĞǀĞƌ ďĞĞŶ ƐŽ ďƵƐŝŶĞƐƐ ĐƌŝƟĐĂů ʹ ĂŶĚ ŝƚ͛Ɛ Ă ŵĂƌŬĞƚ ƚŚĂƚ ǁĞ ŬŶŽǁ ŝŶƐŝĚĞ ŽƵƚ͘ :ĂŵŝĞ tĂůŬĞƌ DĂŶĂŐĞƌ Ͳ >ŝĨĞ ĐƚƵĂƌŝĂů
DŝĐŚĂĞů >ŝdžĞŶďĞƌŐ Director Ͳ ƵƌŽƉĞ ĐƚƵĂƌŝĂů
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E m.lixenberg@darwinrhodes.com +44 (0) 207 621 3759
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ĂŝŶĂď ůŝ Consultant Ͳ ƵƌŽƉĞ ĐƚƵĂƌŝĂů
E a.hill@darwinrhodes.com +44 (0) 207 621 3792
E z.ali@darwinrhodes.com +44 (0) 207 621 3771
sŝĐƚŽƌŝĂ ƌƵŝĐŬƐŚĂŶŬ Consultant Ͳ EŽŶͲ>ŝĨĞ ĐƚƵĂƌŝĂů
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E t.weymans@darwinrhodes.com +44 (0) 207 621 3756
W www.darwinrhodes.com E London@darwinrhodes.com
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UK & EUROPE | HONG KONG | CHINA | INDIA | AUSTRALIA | USA
THE ACTUARY • January/February 2013
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London : Chicago : Hong Kong : Singapore : Shanghai
www.theactuaryjobs.com
Head of P&C Pricing - Europe Non-Life Actuarial Consultant Competitive Package Top Quartile Salary, Bonus and Package - Dublin This multinational reinsurer is looking to hire an experienced actuary to head their P&C pricing team. The main remit is to develop and maintain the pricing system. You will also be involved in the coordiantion of global pricing projects, the management of the global pricing team anbd the training of local pricing teams. Furthermore, you will support the Chief Actuary and evaluate abnd assess intrernal PRGHOV 3 & 7KH LGHDO FDQGLGDWH ZLOO EH D IXOO\ TXDOL¿HG DFWXDU\ with sound team management experience. Broad actuarial P&C knowledge, and expertise in reinsurance pricing is essential. Good communication and programming skills would be advantageous. Contact ivan.clarke@ipsgroup.co.uk +44 207 481 8686
7KLV HVWDEOLVKHG DQG ZHOO NQRZQ FRQVXOWLQJ ¿UP LV ORRNLQJ WR KLUH an experienced actuarial consultant to join their insurance consulting division. The fundamental thrust of the role is to lead or support projects for insurance company clients on a range of issues including pricing, claims reserving, capital management and Solvency 2. Also, this person will look to further develop client relationships through new business and also contribute to the development of throught leadership and UHVHDUFK FDSDELOLW\ &DQGLGDWHV ZLOO EH TXDOL¿HG DQG KDYH DW OHDVW \HDUV experience of managing non-life actuarial projects in the Irish or UK marketplaces. Contact anthony.chitnis@ipsgroup.co.uk +44 207 481 8686
Consulting Actuary - Pensions - Dublin Pensions Actuary for an Expanding Team 7RS 4XDUWLOH 6DODU\ %RQXV %HQH¿WV 3DFNDJH Â&#x2026; Â&#x2026; %RQXV %HQH¿WV 7KLV SUHVWLJLRXV FRQVXOWLQJ ¿UP ZKLFK KDV D VXFFHVVIXO VSHFLDOLVW pensions team advising both boards of management and trustees is ORRNLQJ WR KLUH DQ DPELWLRXV DFWXDU\ ZLWK F \HDUV SRVW TXDOL¿HG experience. The team advises on a range of issues covering funding strategies, effective management of pensions risk and pensions design. Candidates will have worked in the Irish market in a consulting environment assisting with or leading projects on corporate pensions strategies for both corporate and trustee clients. Contact anthony.chitnis@ipsgroup.co.uk +44 207 481 8686
A unique opportunity for a pensions actuary who is ready for a fresh challenge and a totally different working environment. 7KLV H[SDQGLQJ FRQVXOWDQF\ KDV VHW XS D /RQGRQ RI¿FH DQG KDV successfully won a healthy number of clients. They are looking for an actuary who will be comfortable not just in maintaining these existing relationships but who is able to network and generate business themselves. Alongside the pensions work there will be the opportunity to become involved in all aspects of the wider EXVLQHVV <RX PXVW KDYH D 6FKHPH $FWXDU\ FHUWL¿FDWH DQG KDYH EHHQ TXDOL¿HG DV DQ DFWXDU\ LQ WKH 8. IRU DW OHDVW WKUHH \HDUV Contact simon.arthur@ipsgroup.co.uk +44 207 481 8686
/RQGRQ 2I¿FH IPS Group, Lloydâ&#x20AC;&#x2122;s Avenue House, 6 Lloydâ&#x20AC;&#x2122;s Avenue, London EC3N 3ES 7HOHSKRQH 020 7481 8686 Email: actuarial@ipsgroup.co.uk /HHGV 2I¿FH IPS Group, 8 St Paulâ&#x20AC;&#x2122;s Street, Leeds LS1 2LE January/February 2013 â&#x20AC;¢ THE ACTUARY 7HOHSKRQH (PDLO DFWXDULDO#LSVJURXS FR XN ACT.02.13.043.indd 43
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Appointments
High Finance Group Specialist Recruiters
Matchmaking Professionals With Profits Specialist
£80k - £120k + Bonus, London
A unique opportunity for a consultative and market facing With-Profits Actuary. You will have extensive knowledge of large With Profits funds, previous senior stakeholder management experience and excellent communication skills. This is a fantastic opportunity to advance your career and diversify your knowledge within a truely industry leading environment. Graeme@highfinancegroup.co.uk
Senior Reporting Actuary
£75k - £100k + Bonus, London
Reporting directly to the Chief Actuary of this bespoke life insurer you will coordinate all financial reporting tasks, manage the outcome of specific projects and deliver reports to Senior management. You will have direct management of a team of qualified and junior Actuaries operating across MCEV, IFRS and UK Gaap. Previous experience across UK Reporting and team management is essential. Graeme@highfinancegroup.co.uk
Protection Product Analyst
£35k - £55k + Bonus, London
£80k - £100k + Bonus, London
FRM Actuary
A rare opportunity to join a Financial Risk Management team with a major life insurer working closely with senior management at Group level. You will be responsible for delivering assurance, oversight and the challenging financial risk frameworks across the business. You will have excellent communication skills, broad financial risk management experience and a confident approach to interacting with Board level stakeholders. Graeme@highfinancegroup.co.uk £60k - £80k + Bonus, London
Reinsurance Actuary
This is an opportunity to work for a market leading life insurer who are looking for a nearly / newly qualified Actuary with life insurance experience. Your responsibilities will include Pricing new products, and you will be given the opportunity to work alongside high calibre individuals and work directly with the Chief Actuary. Sophia@highfinancegroup.co.uk
Financial Reporting Actuary
€75k - €85k + Bonus, Dublin
A multi-national insurer is looking for a part qualified life actuarial student to join their product development team. You will be working directly with the Head of Product Development and Pricing and get involved in key decisions within the team. Knowledge of protection products is key along with a highly technical yet commercially minded outlook. Sophia@highfinancegroup.co.uk
Join a growing team in this market leading Life insurer. Working closely with the Chief Actuary, you will liaise with international teams to ensure a competitive pricing strategy. This is an exciting opportunity to take the next step up in your career. You will have responsibility for mentoring students and gain broad exposure across all areas of the business. Sophia@highfinancegroup.co.uk
Product Development Analyst £35k - £60k + Bonus, London A fast growing Life Insurer requires a Product Development Actuarial Analyst to assist the implementation of Pricing changes and manage the Product Pricing process. You will work alongside a small team leading product development projects; from system and illustration development to Actuarial modelling and pricing. This exciting opportunity offers future management responsibilities in a highly visible team. Jack@highfinancegroup.co.uk
Life Actuaries – Pricing £Various, London Area A leading niche Life Insurer is looking to grow its Pricing and Product Development team to cope with the additional demands following the release of a new product. This entrepreneurial role covers a variety of tasks; from product approval and governance through to the generation of new ideas. Roles are available for candidates ranging from Junior Analysts through to Senior Pricing Actuaries so for more information, please get in touch. Jack@highfinancegroup.co.uk
In-house Pensions Actuary Up to £65k + Bonus, South East
Head of Investments
A rare opportunity to take your experience in-house. Working across scheme management, funding strategy and associated risks. This is a chance to gain ownership and directly influence decisions. Nearly / newly qualified, you will be motivated, an effective communicator with people of varying expertise and thrive in a multi-discipline environment. Miranda@highfinancegroup.co.uk
Join this highly regarded insurer within a pivotal and exciting role. Possessing a strong background in investment strategy, market movements and associated risk appetite, you will be responsible for shaping their multi asset portfolio and building the risk framework. This role includes high levels of interaction at board level. Miranda@highfinancegroup.co.uk
Up to £100k + Bonus, London
Up to 150.000 EUR Basic, Germany
Model Validation Specialist - Germany
One of the largest insurance companies in Europe is looking to add an experienced Actuary or Risk professional to their growing team at group level. You will be in the centre of the company’s Actuarial and Risk management teams and have a direct impact on key developments within the group. This position represents the ideal opportunity for someone looking to build on recent Solvency II experience and someone who wants to be involved in future developments within that area. The key focus of the role will be to define the model governance requirements of the business and ensure adherence to it for the full life cycle of the model. This is a truly broad role encompassing Solvency II requirements and also wider regulatory developments. Candidates with a strong risk management focused mind-set from a regulatory perspective and model experience are preferred. Excellent salary and benefits offered. Richard@highfinancegroup.co.uk
Life
SOPHIA CROSSMAN Life
MIRANDA WILKINSON Pensions & Investments
RICHARD SENGER Europe
+44 (0) 207 337 8820
+44 (0) 207 337 1207
+44 (0) 207 337 8815
+44 (0) 207 337 8806
graeme@highfinancegroup.co.uk
sophia@highfinancegroup.co.uk
miranda@highfinancegroup.co.uk
richard@highfinancegroup.co.uk
GRAEME BRAIDWOOD
44
THE ACTUARY • January/February 2013
+44 (0) 207 337 8800 ACT.02.13.044.indd 44
actuarial@highfinancegroup.co.uk
www.highfinancegroup.co.uk 29/01/2013 09:54
www.theactuaryjobs.com Actuarial & Risk Management The team has dedicated consultants who are industry specialists and who appreciate the importance of understanding the market from a technical and commercial perspective. Our global team of specialist consultants have exclusive networks across Non-Life, Life & Health and Pensions & Investments sectors. We are working on a number of retained and exclusive mandates as well as various contingent assignments. Please contact us directly about our current projects or for a more informal discussion about your career aspirations.
Contact Rob Bulpitt
Rupert Rickard
Office Number
For current opportunities please visit
Head of Actuarial, Insurance & Pensions Risk Management 020 7092 3237
+44 (0)20 7092 3200
Manager of Actuarial Non-Life and Insurance Risk Management 020 7092 3219
www.eamesconsulting.com
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EXPOSURE MANAGEMENT EXECUTIVE London Up to £80k + benefits allowance + bonus
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A great opportunity to get involved in the management of syndicate catastrophe risk. Suitable candidates will have an understanding of risk modelling principles within general (re)insurance (particularly Property) and have experience of either AIR, RMS, or EQECAT. Prior cat modelling experience is essential. Whilst you won’t be running such models in this particular role, your understanding of its implications for the business is key. You will need to be credible at a senior level and have good influencing and negotiation skills. You will have the opportunity to make a significant contribution towards catastrophe risk methods, and also assist in business planning & capital setting.
Parvinder Matharu Newton Recruitment t +44(0)1689 862937 e parvinder@newtonrecruitment.com w www.newtonrecruitment.com Contact
theactuaryjobs.com
January/February 2013 • THE ACTUARY
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Appointments
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THE ACTUARY • January/February 2013
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Risk Actuary Competitive salary + bonus + benefits Pacific Life Re offers a comprehensive range of wholesale life risk management products and services in the UK, Ireland, Asia and North America. We have built a strong, experienced team with a reputation for technical excellence, responsiveness, innovation and excellence in service delivery to our clients. Pacific Life has a distinguished history and a reputation for corporate and financial strength, high ethical standards and a strong focus on customers.
The Role The Risk Actuary will support the CRO in the implementation and maintenance of a robust and appropriate risk management system across Pacific Life Re’s three main locations in the UK, North America and Singapore, with a particular focus on the UK. As an expert in economic capital you will play a central role in the ongoing development and support of the internal model supporting our UK and Asia business. You will also have the opportunity to lead the integration of the North American retrocession economic capital model in a divisionwide internal model. Working with colleagues across the business you will promote the consistent application and upkeep of our well-established enterprise risk management framework. This wide ranging role will involve reviewing new products and territories, detailed analysis of emerging risks and staff development and training. You will have regular access to senior stakeholders and decision-making through attendance at risk management committee meetings.
The Individual The successful candidate will demonstrate excellent technical and communication skills along with sound commercial judgment and awareness. As a qualified actuary with a minimum 3 years’ pqe you will be expected to have experience of life and health insurance products and economic capital modelling techniques. The ability to challenge, influence and build credibility with senior stakeholders and colleagues will also be expected. Knowledge of the UK prudential regulatory regime and Solvency II will be advantageous. Archimedes recruitment is the agency exclusively represenƟng PaciĮc Life Re for this vacancy. If you are interested to apply or for an informal conversaƟon about the role, then please contact Ben Mulleady or Rachel Mulleady on +44 1256 466640 or email: ben@archimedesrecruitment.com or rachel@archimedesrecruitment.com
Archimedes recruitment
Bolton Associates is a specialist search firm established in 2010. We work with clients in the Lloyd’s and London Market and across the insurance industry as a whole, and have an extensive network to whom we can introduce our candidates. From a candidate perspective we can work with you at all levels, from graduate entry to Senior Partner, CRO and beyond. Many of our roles are exclusive and therefore always worth speaking to us to hear about the new and exciting opportunities in the market.
Lloyd’s
Chief Pricing Actuary up to £150k plus
Lloyd’s managing agency requires a Qualified Pricing Actuary to establish a dedicated pricing function to support underwriters across the Property & Casualty divisions. The reserving and capital functions already exist, and there will be support from this area, however you should consider this a greenfield opportunity and the opportunity to make your mark at a senior management level. It is also worth noting that the managing agency is part of a larger insurance group.
Lloyd’s
Deputy Group Reserving Actuary up to £120k plus
Super firm to work for requires a number two to the Group Actuary, focusing predominantly on the Group reserving. This firm offers excellent long-term opportunities, and therefore the flexibility to gain experience elsewhere in the group, to enhance new skill-sets, or experience new territories. Candidates will be newly qualified ideally, and have the ability to manage more junior students, and take control of whole processes, cradle to grave.
Please contact Zoe Bolton or one of the team for more information or a general enquiry Email: zoe@bolton-associates.co.uk 5 St. John’s Lane, London, EC1M 4BH tel 020 7 250 4718 www.bolton-associates.co.uk
January/February 2013 • THE ACTUARY
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Appointments
Asia-Pac Opportunities
Specialist Recruiters New Opportunities In Hong Kong
Life
Up to HKD 1m + Bonus
Hong Kong
Associate Director / Senior Manager Up to SGD 200k + Bonus
General Bermuda
A Global Insurer with a market leading position in Asia, is growing their team in Hong Kong. They require nearly/newly qualified Actuaries for managerial roles in Valuations, Modelling (Prophet/MoSes), Pricing and Governance. You will deliver initiatives, transform the way they do business and influence change centrally and regionally in Asia. (CB)
A career-making role for an experienced Actuary with a strong focus on ERM to join this Global Consultancy. A business leader is required to deliver a new service line as they co-ordinate their Risk & Actuarial advisory practice offering bespoke advice. You will work with the Practice leader to develop this service to on and off shore clients. (CB)
Financial Reporting Actuary
Market Developer â&#x20AC;&#x201C; Analyst
Life
Up to SGD 120k package
Singapore
Dependent on Experience
Life & General Hong Kong
A respected Life Insurer is looking to strengthen their financial reporting team in Singapore and requires an experienced valuation Actuary to take charge of capital management reports, Valuations, IFRS Reporting and ALM, leading the annual financial projection workstream, quarterly EV reporting, and monitoring financial KPIs (CE)
Exciting opportunity to help develop the Asian market presence of this global Insurer. They require an experienced market developer to assist in analytics and client mapping as they build their brand across the region, delivering year on year growth in new markets. Fluency in English is essential, a second Asian language is advantageous. (XW)
Associate Director - Emerging Markets
Chinese New Year â&#x20AC;&#x201C; Opportunities for Actuaries
Life
Competitive Salary + performance bonus Singapore / Hong Kong
Market Competitive
Are you an entrepreneurial, qualified Life Actuary, interested in identifying business opportunities in the emerging Asian Insurance market? Our client requires an Actuary with Leadership and Business Development credentials to be effective as they experience growth in the region. The role offers travel across the Asia and you will manage multiple projects, a young team of actuaries (CE)
Hong Kong, Singapore, Shanghai, Kuala Lumpur, Jakarta, Bangkokâ&#x20AC;Ś Are you looking to move East to these rapidly expanding markets? Our clients need commercially minded Actuaries who want to experience the dynamism of working in these major financial cities. We have Actuarial and Risk roles for a wide range of skills from part qualified to highly experienced. Please get in touch for more information (XW)
Senior Consultant, Clare Bethell Consultant, Collette Edwards
clare@highfinancegroup.co.uk collette@highfinancegroup.co.uk
Asia
+44 (0) 207 337 8829 +44 (0) 207 220 0174
ྲáˇ&#x152;á&#x203A;&#x2DC;á?źáľ&#x2039;Ňśä&#x20AC;&#x201C;á´¤ŕ˝&#x160;ŕľ&#x2DC;Ó&#x160;â?˘â˛´ă&#x2039;Žă&#x2021;&#x2021;ᾪŐ&#x160; ä&#x2C6;§ă&#x161;&#x201E;ă&#x152;ŤâŚťä´&#x161;â&#x152;ťÇ&#x201E;
Consultant, Xueyang Wang
xueyang@highfinancegroup.co.uk
+44 (0) 207 337 1203
Business Critical As a self-respecting actuarial professional, youâ&#x20AC;&#x2122;ll no doubt want to keep up with the latest industry developments, people and society updates and professional news. But youâ&#x20AC;&#x2122;re also busy being an actuarial professional. Right? Thatâ&#x20AC;&#x2122;s why The Actuaryâ&#x20AC;&#x2122;s weekly email alert brings you a handy round-up of only the most relevant news stories and comment, straight to your inbox, every Thursday.
Visit www.theactuary.com to see how weâ&#x20AC;&#x2122;ve changed 48
THE ACTUARY â&#x20AC;˘ January/February 2013
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MAKE ASIA YOUR NEXT DESTINATION Asia’s economic growth shows little sign of slowing, and this growth brings new challenges for the workforces of our clients. Mercer’s retirement and investment teams help organisations identify and implement optimal retirement and long-term savings solutions. We invite you to join our team of experts and share in this period of unprecedented growth. Destination Asia promises all: variety, culture, and the opportunity to realise your potential. Mercer currently has openings in Beijing, Hong Kong, Shanghai, Singapore, Tokyo and Jakarta. We would like to hear from experienced actuaries and benefits consultants with a track record of high achievement and a commitment to working in the region. To learn more please send a copy of your CV to Elizabeth Yeo (elizabeth.yeo@mercer.com) or call on +852 3476 3925. www.mercer.com
School of Mathematics, Statistics and Actuarial Science (SMSAS)
the UK’s European University The University of Kent is one of the UK’s most dynamic universities with a strong European and international presence. Our excellent RAE results reflect our worldleading research and, while we are currently increasing our postgraduate activities, our undergraduates continue to rate us one of the top universities in the country according to the National Student Survey (Kent was placed 3rd for overall satisfaction out of 125 Higher Education Institutions in the 2012 Survey for taught students).
Senior Lecturer in Actuarial Science
Ref: STM0342
£45,941 - £53,233 p.a.
Lecturer in Actuarial Science
Ref: STM0343
£31,331 - £44,607 p.a. Salary is dependent on experience and qualifications. In addition, a market related supplement will also be payable to a qualified Actuary. Applications are invited for the positions of Senior Lecturer in Actuarial Science and Lecturer in Actuarial Science. These 2 posts will be based at our Canterbury campus on a full time basis and are available from 1st July 2013 or as soon as possible thereafter. The successful candidates will join the Centre for Actuarial Science, Risk and Investment (CASRI), which is part of the School of Mathematics, Statistics and Actuarial Science (SMSAS). The Centre is well established and enjoys an excellent working relationship with the UK Actuarial Profession. Currently, undergraduate and postgraduate programmes in Actuarial Science and Finance are offered by the Centre. All our Actuarial Science programmes are accredited by the UK Actuarial Profession. The persons appointed will be expected to contribute to the School’s teaching activities in Actuarial Science and Finance. The positions will also provide opportunities for research, consultancy and enterprise activities. Ideally, the appointee at Senior Lecturer level will be expected to contribute to innovative research programmes in Actuarial Science and other areas of finance. Applications for the Lecturer position on a part time basis (2 x 0.6 FTE posts or 1 x 1 FTE) would be considered. An excellent package, including contribution to relocation costs, is offered. Informal enquiries may be made to Professor Malcolm Brown, Head of SMSAS, on: +44 (0)1227 823508 (direct line) or e-mail: M.S.Brown@kent.ac.uk Informal visits to the School are welcomed.
Further information is available from our website http://www.kent.ac.uk/jobs
Minicom users please telephone 01227 824145.
Closing date for completed applications: 1st March 2013. Interviews are expected to be held: 3rd or 4th April 2013. For posts of this nature you will be required to fill in the main details section as well as upload your CV which should include a personal statement and any supporting documents. We actively promote equal opportunity in education and employment and welcome applicants from all sections of the community.
January/February 2013 • THE ACTUARY
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Appointments LDI PRODUCT STRATEGIST Asset Management, London £Excellent + benefits
DEPARTMENT OF INSURANCE AND ACTUARIAL SCIENCE PROFESSOR/ASSOCIATE PROFESSOR ABSA CHAIR: ACTUARIAL SCIENCE Applications are invited for a permanent full-time position for the above levels of appointment. The ABSA Chair is specifically aimed to enhance research and postgraduate education within the Department of Insurance and Actuarial Science at the University of Pretoria. It will be expected that the successful candidate supervise post-graduate students and work on research topics that will lead to publications in peer reviewed scientific journals. The Department belongs to a cluster of departments in the Mathematical Sciences (Insurance and Actuarial Science, Mathematics and Applied Mathematics and Statistics) and it is envisaged that the Chair will participate in already existing research activities in financial and insurance related research. It is expected that the Chair will have a strong focus on the development and strengthening of research networks in Africa, including postgraduate study and mentorship programmes. The department has already built close relations with the recently established Aon Benfield Natural Hazard Centre in Africa which is also hosted in the same Faculty. Minimum Requirements: A qualified actuary with either a PhD or a senior qualified actuary with vast post-qualification experience at a senior level, leadership in the actuarial profession as well as an established research record. Remuneration: A highly competitive package will be offered in accordance with qualifications and experience. Benefits: Generous leave (vacation leave: 42 days and research leave: 24 working days), retirement fund, medical aid and rebate on study fees. Closing date for applications: 7 March 2013 Enquiries: Prof Anton Ströh, Tel. +2712 420 3201 or e-mail: dean.nas@up.ac.za 50
This is a front office role with a leading asset management firm. In this role you will maintain a high degree of current market knowledge as you’ll communicate with teams across the business. This will include representing the team in new instrument and product development initiatives, providing technical input to RFP’s and new business pitches; and driving the development of LDI thought pieces to determine market opportunities which tie in with clients’ long term de-risking strategies. You’ll proactively look for ways to improve the product offerings based on market conditions and client demand and implement changes within the team to increase the flexibility of the team’s offering to pension scheme clients. Suitable candidates will be FIA or CFA qualified and have familiarity with the LDI market including recent trends in risk management solutions for pension schemes. Candidates with ALM or LDI solutions experience from an asset manager, bank or investment consultancy will be considered.
Parvinder Matharu Newton Recruitment t +44(0)1689 862937 e parvinder@newtonrecruitment.com w www.newtonrecruitment.com Contact
Structurer – LDI Solutions – Central London £80,000 – £90,000 plus Bonus
Ref: MJB56638
My client, one of the large LDI providers, is looking for an experienced investment consultant to join their team. This role is a mixture of both client facing and technical, as the successful candidate will meet clients to discuss their requirements before designing bespoke LDI solutions to present back to them. Strong communication and technical skills are a must, together with exposure to derivatives/ liability hedging mechanisms. The successful candidate is also likely to be a qualified Actuary or CFA. E: matt.bullock@goodmanmasson.com
Pricing Actuary – Central London £70,000 – £95,000 plus bonus
T: 020 7324 0505
Ref: BG56561
Due to excellent performance and company growth, a new position in London has been created at a life insurer seeking a qualified Pricing Actuary. You will ideally have had previous Risk Capital Modelling or possibly have ICA / Pillar II experience. This is a technical role that will include checking and amending calibrations, assumption checking and adjusting, in order to be able to advise on capital requirement levels. E: bradley.grant@goodmanmasson.com
T: 020 7019 8869
goodmanmasson.com
THE ACTUARY • January/February 2013
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New addition, same quality.
www.theactuaryjobs.com
Pure Search Actuarial & Risk Our Actuarial & Risk practice specialise in mid to senior level risk management opportunities within core and non-traditional disciplines, both in the UK and internationally. Our experienced consultants have achieved a strong track record of assignment success, sourcing individuals and teams across a variety of specialisms within Insurance, Pensions and Investments. We work with a broad range of clients including multinational and boutique consultancies, Life and NonLife insurance businesses, FTSE listed companies as well as a selection of Asset Managers and Banks.
Recent Transaction History
Introducing our latest addition
Multinational Insurer European Head of Solvency II (Actuarial) Bancassurer Director of Insurance Risk Management Healthcare Provider Capital Management Actuary Life Insurance Asset Manager LDI Strategist Buyout Advisory Principal, Head of Buyout Business Development Big 4 Accountancy Head of DC Investment Advisory Asset Manager Deputy Head, DC Investment Global Employee Benefits Consultancy Principal, Investment Consulting Global Employee Benefits Consultancy EMEA Head of Retirement Big 4 FRM Specialist & Head of Regional Office Big 4 Senior Managers & Managers (Multi-Hire)
For the latest opportunities, news and market intelligence, please contact
Martine Scott-Gordon AFA
(w+44 20 7429 4446 *wmartinescott-gordon@puresearch.com martinescott-gordon@puresearch.com
London
|
Hong Kong
|
Singapore
www.puresearch.com January/February 2013 â&#x20AC;˘ THE ACTUARY
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Appointments
NON-LIFEFUTURES PEOPLE, PROJECTS, POTENTIAL LONDON
NON-LIFE up to £150k + bonus + benefits
Can you bring out the best in people? Do special projects bring out the best in you? Contact us to fulfil your potential in this unique role with a market-leading insurer.
HEAD OF PRICING AND RESERVING LONDON
NON-LIFE
up to £120k + bonus + benefits
Contact us regarding this fantastic opportunity to take up a key position in a global, non-life specialist business with growth on its mind. Ref: Star1224
Ref: Star1380
GLOBAL HEAD OF PRICING ZURICH PLUS TRAVEL
NON-LIFE CHF excellent + bonus + benefits
SOUTH EAST PLUS TRAVEL
NON-LIFE
up to £110k + bonus + benefits
Take up this vital role leading a worldwide pricing team. Working alongside the Chief Pricing Actuary, you will coordinate global pricing projects, training and developing local teams. Ref: Star1391
Experience key international markets. Provide strategic direction. Solve complex problems. Develop and support a high-performing team. Please contact us to discuss this exciting opportunity. Ref: Star1265
ACTUARIAL LEADER
LONDON MARKET INNOVATION
LONDON
NON-LIFE up to £100k+ bonus + benefits
Develop new products. Make commercial decisions. Build technical models. Bring a fresh perspective. Inspire a team. This role will provide variety, challenge and responsibility. Ref: Star1375
RISK ACTUARY LONDON
NON-LIFE up to £90k + bonus + benefits
LONDON
NON-LIFE £ excellent + bonus + benefits
Leading London Market company seeks creative and enthusiastic part qualified or qualified non-life actuary to lead its reserving process, working closely with claims managers and underwriters. Ref: Star1238
NON-LIFE
RESERVING. PRICING. CAPITAL. LONDON
£ excellent + bonus + benefits
Are you seeking exposure to a highly commercial environment to enhance your strong influencing and business skills? We are working on a varied role in a high-performing team that could provide exactly what you are looking for. Ref: Star1395
Fantastic opportunity to join a specialist (re)insurance group as the first actuary within a growing business unit. You will lead the reserving process, provide pricing support and calibrate the internal model. Ref: Star1392
LONDON MARKET PRICING
ONCE IN A LIFETIME OPPORTUNITY
LONDON
NON-LIFE circa £50k + bonus + benefits
LONDON
NON-LIFE £ excellent basic + upside
Our client is seeking a talented, motivated part-qualified non-life actuary to take up a key role within its pricing team. Candidates from a reserving or capital modelling background will be considered. Ref: Star1394
A truly unique opportunity for a part-qualified actuary with reinsurance experience to join a dynamic organisation on an upward trajectory and work with some of the sharpest minds Ref: Star1389 in the industry.
REINSURANCE BROKING ANALYST
RETURN ON YOUR CAPITAL
LONDON
NON-LIFE
£ excellent + bonus + benefits
Design and place reinsurance contracts. Develop your skills through cutting-edge risk advisory projects. Work with brokers, underwriters and catastrophe modellers. Build your profile in a niche market. Call us now and never look back. Ref: Star1379
Louis Manson 52
HEAD OF INTERNATIONAL RESERVING
MANAGING DIRECTOR THE ACTUARY • January/February 2013 M +44 7595 023 983 E louis.manson@staractuarial.com
ACT.02.13.052/53.indd 52
12 MONTH CONTRACT
NON-LIFE £ market rate
Provide your expertise in capital modelling and people management. In return, gain exposure to a worldwide organisation with cutting-edge enterprise risk management. Ref: Star1356
Antony Buxton FIA
Joanne Young
Irene Paterson FFA
MANAGING DIRECTOR
OPERATIONS DIRECTOR
PARTNER
M +44 7766 414 560 E antony.buxton@staractuarial.com
M +44 7739 345 946 E joanne.young@staractuarial.com
M +44 7545 424 206 E irene.paterson@staractuarial.com
29/01/2013 11:54
www.theactuaryjobs.com
LIFE PENSIONS INVESTMENTFUTURES LIFE
LOCATION UPON APPLICATION
up to £130k + benefits
MOSES DEVELOPER
LIFE
LONDON
£ excellent + bonus + benefits
Start-up life business is seeking a high calibre actuary to provide strategic support in the development of its business model. The successful candidate will play a key role in establishing pricing processes. Ref: Star1196
Global organisation seeks a talented MoSes developer to take responsibility for the design and implementation of innovative technical solutions. The successful candidate will have strong communication and project management skills. Ref: Star1338
ACTUARIAL RISK MANAGEMENT
CAPITAL ACTUARY
EDINBURGH
LIFE £ excellent + bonus + benefits
Our client is offering an exciting role that will provide true insight into how a market-leading life insurance company really works. Work with key stakeholders to identify, assess and communicate risks to the business. Ref: Star1327
LIFE
BUSINESS DEVELOPMENT ACTUARY SOUTH EAST
up to £68k + bonus + benefits
LIFE
SOUTH EAST
up to £80k + bonus + benefits
Leading life assurance and pensions provider is seeking a qualified actuary with experience of Solvency II to take up a key role reporting to the Chief Actuary and advising the Board on capital management. Ref: Star1344
WITH-PROFITS MANAGEMENT LONDON
LIFE £ excellent + bonus + benefits
A high profile role, within the international business unit, where you will be responsible for the production and communication to the market of new business performance statistics. Ref: Star1354
Leading insurer seeks part qualified or qualified life actuary with strong analytical and problem-solving skills and the ability to interpret detailed requirements and implement model developments. Ref: Star1393
RISING MODELLING STAR
SPECIAL PROJECTS
LIFE up to £60k + bonus + benefits
BRISTOL
LIFE up to £45k + bonus + benefits
SCOTLAND
Our client is seeking a part-qualified actuary to design, develop and maintain complex actuarial modelling solutions to meet customer requirements. An excellent opportunity to gain experience in a large life insurance company. Ref: Star1378
Leading UK life insurer seeks a part-qualified actuary to work on a wide variety of pricing projects. The successful candidate will have strong communication and stakeholder management skills. Ref: Star1382
HEAD OF INVESTMENT CONSULTING
HEAD OF LONDON OFFICE
LONDON
LONDON
£ excellent + bonus + benefits
PENSIONS fit £ excellent + bonus + benefits
Our client seeks a high calibre investment consultant with the knowledge and skills to take its successful practice to the next level. You will develop new and existing clients and grow the team and its capabilities. Ref: Star1368
Are you seeking a new challenge? Do you enjoy business development and team leadership? Take this opportunityy to build your career within a dynamic organisation.
MANAGEMENT CONSULTANCY
STOCHASTIC MODELLING
BIRMINGHAM
PENSIONS £ excellent + bonus + benefits
Global firm seeks qualified actuary to provide management consultancy services to corporate sponsors of pension schemes. You will provide specialist advice on risk solutions and scheme financing to a wide range of clients. Ref: Star1377
Ref: Star132 Star1326
EDINBURGH
PENSIONS up to £40k + bonus + benefits
Our client is seeking a part-qualified actuary to work with product managers and quantitative analysts to develop technical methods for the modelling of pension liabilities within a stochastic modelling framework. Ref: Star1369
Star Actuarial Futures Ltd is an employment agency and employment business
START-UP LIFE BUSINESS
www.staractuarial.com
Lance Randles MBA
Paul Cook
Clare Roberts
ASSOCIATE DIRECTOR
SENIOR CONSULTANT
SENIOR CONSULTANT
M +44 7889 007 861 E lance.randles@staractuarial.com
ACT.02.13.052/53.indd 53
M +44 7740 285 139 E paul.cook@staractuarial.com
M +44 7714 490 922 E clare.roberts@staractuarial.com
Peter Baker SENIOR CONSULTANT January/February 2013 • THE ACTUARY
53
M +44 7860 602 586 E peter.baker@staractuarial.com
29/01/2013 11:55
Appointments
Hazell Carr was founded by actuaries in 1997 as HC Actuarial Services (HCAS), and developed as a leading provider of actuarial resource, through provision of services from consultants and an inhouse actuarial team - which to date form a significant part of Hazell Carr. Hazell Carr is now also part of a wider group which includes a specialist actuarial consultancy and one of the largest pension administration providers in the UK. This heritage, capability and diversity mean Hazell Carr is not simply a supplier of actuarial resource, but is also an integral part of the industry, with an excellent understanding of the market, client requirements and candidate preferences. Working with Hazell Carr, you liaise with an actuary who understands the worth of professional qualifications and the necessary steps to ensure the most suitable match is made between clients and candidates. This builds If you are interested in rewarding long term relationships, whilst providing quality joining Hazell Carr or would delivery at competitive prices. like to find out more about obtaining our services, call us Hazell Carr works with organisations across the spectrum of on 0118 951 3787 or email financial services, including asset managers, general insurance actuarial@hazellcarr.com firms, high street and investment banks, life insurers, pension administrators, pension consultancies, reinsurance brokers & intermediaries, and wealth management firms.
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www.theactuaryjobs.com
Fresh Thinking For the latest news and views, visit theactuary.com. With high quality content, useful tools and easy navigation, you will find a wealth of actuarial resources at your fingertips. Register for weekly email newsletters Read the latest features and opinion and add your comments Read about actuaries stepping into new frontiers Browse theactuaryjobs.com, the official jobs board of the UK actuarial profession
Visit www.theactuary.com January/February 2013 • THE ACTUARY
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Appointments United Kingdom
General Insurance Chief Actuary Rick Davis
Head of Actuarial Sarah Robins
South East £220,000 + Strong Package
South East £150,000 + Bonus + Bens
A start-up insurance company with the backing of a global organisation requires a proven Chief Actuary to form part of the Senior Management team. Working closely with the CEO you will develop strategy and build an actuarial function. Strong UK personal lines experience is essential.
A leading retail insurer is seeking a qualified actuary to provide strategic people direction and leadership to the corporate actuarial function. You will be operating at director level; overseeing projects, strategy and actuarial standards. This is an excellent opportunity to enhance your career in a high profile role.
2 x Actuarial Managers, 1 Head of Department London Paul Francis £150,000 + Bonus + Bens
Senior Capital Actuary Rick Davis
I have been mandated to select top-tier candidates for one of the most progressive Lloyd’s businesses. These are Greenfield positions seeking Actuarial Managers with skills in Reserving and Capital, and a H.o.D. for Reserving and Pricing.
An established Lloyd’s Syndicate requires a recently qualified Actuary to lead the capital work for their business. This is a highly visible role in which you will also manage a small team of analysts. Requires strong capital experience and a high level of commercial acumen.
Capital Actuary Sarah Robins
Pricing Analyst Ben Pitt
London £80,000+ Bonus + Bens
London £100,000 + Bonus + Bens
London £50,000 + Bonus + Bens
A specialist insurer is seeking a senior actuary to lead the capital team. You will report directly into the Head of Capital. You should be a part or fully qualified actuary with capital modeling experience. This is a great opportunity to enhance your career and gain management experience.
A leading London market insurer is looking for a part qualified actuary to join its impressive ranks. You will develop and maintain pricing techniques for all lines of business and work closely with underwriters. No previous pricing experience required.
Reserving Actuary - Personal Lines London Richard Howard £40,000 - £65,000 + Bonus + Bens
Actuarial Analyst - London Market Pricing London Richard Howard £40,000 - £60,000 + Bonus + Bens
Highly profitable managing agent looking for an actuarial student with 1-4 years experience of reserving across motor lines. Must have experience of reserving in personal lines classes and have excellent communication skills.
Established London syndicate looking for an actuarial student with 2-3 years experience for their well-established pricing team. Must have great communication skills and experience within an actuarial pricing position within General Insurance.
Contracts - GI Part Qualified Actuary Stewart Cherry
Senior Pricing Stewart Cherry
London / South East £500-700/day – 6 Months
A Lloyd’s syndicate is looking for a part qualified actuary, with pricing and reserving experience for a 6-9 month contract.
A Senior Pricing Actuary with London Market experience is required for a 6-12 month contract.
Senior Reserving Actuary Stewart Cherry
Remetrica Capital Contract Stewart Cherry
London £1000/day – 6 Months
London / South East £800/day – 6 Months
A leading national insurer is looking for an experienced qualified Reserving Actuary, 6 month contract.
A Remetrica modelling actuary is required to join a London Market insurer for a 6 month contract.
Igloo Modeller Rob Bentham
Reserving Actuary Rob Bentham
London Up to £800/day – 3 Months
A well respected London Market client is looking to bring in an Igloo Modeller for an initial 3 months.
56
London £800/day – 6 Months
London (City) Up to £1000/day – 6 Months
A leading London Market insurer is looking for a Reserving Actuary to work within their group function.
General Insurance - UK
Contracts - GI - UK
General Contact Details
Paul Francis 0207 649 9469 Rick Davis 0207 649 9353 Sarah Robins• January/February 0207 3102013 8552 THE ACTUARY Ben Pitt 0207 310 8719 Richard Howard 0207 649 9356
Rob Bentham Stewart Cherry
actuary@ojassociates.com
Web
www.ojassociates.com
0207 649 9351 0207 310 8651
Please contact one of the team for further information on any of the opportunities above.
Ben ACT.02.13.056/57.indd 56
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www.theactuaryjobs.com United Kingdom
Life Insurance London £130,000 + Bonus + Bens
Head of Actuarial Clare Nash
Actuarial Project Leader - Life Rachel Kelly
South East £100,000 + Bonus + Bens
EXCLUSIVE APPOINTMENT - I would like to speak to top tier individuals who want to further their career within an international brand. Capital / reporting / consultancy background favoured to lead a growing team.
Excellent opportunity to join a large Life insurer in a high profile senior role. You will build and lead a team with responsibility for streamlining actuarial systems and processes. Suitable for a qualified actuary or senior project manager.
South East Actuarial Software Developer Up to £100,000 + Bonus + Bens David Parker
Product Development Actuary Mehwish Raza
My client, one of the largest global software companies, seeks a strong systems and model development actuary for a technical and commercial role. Previous development/coding experience with Prophet, Moses or Algo is essential.
A qualified actuary is sought by a well-recognised international life business. Excellent project management and influencing skills required. You will work on cutting edge projects and build relationships across the entire business.
Pricing Actuary - Life David Parker
London (City) Up to £90,000 + Bonus + Bens
Product Development Manager Rachel Kelly
South East £80,000 + Bonus + Bens
Highly commercial role - my client is seeking an actuary to shape and develop their flagship proposition. You will enjoy working with cutting edge, innovative products. This is a pivotal hire with high visibility within the business.
A market leading Life insurer is looking to further strengthen its Pricing function with two new positions. A strong commercial background is essential with model calibration exposure ideal. Award winning and rapidly growing business.
London £70,000 + Bonus + Bens
Reinsurance Pricing Actuary Clare Nash
London £85,000 + Bonus + Bens
South East £65,000 + Bonus + Bens
New Business Actuary Mehwish Raza
An unusual role has arisen for a newly qualified actuary to join a market leading team. My client seeks a forward thinking professional to get involved with all aspects of pricing. Pricing / reinsurance background is NOT necessary.
An ambitious reporting actuary is sought by a top insurance business. This is a high profile role with international exposure. You would either be qualified or P/Q with substantial experience in MCEV or new business reporting.
Contracts - Life Prophet Developer Rob Bentham
Senior Moses Modeller Rob Bentham
Various Up to £800/day - 6-9 Months
South West Up to £800/day - 12 Months
Various large Life insurers are looking to boost their contract resource within their Prophet Modelling teams.
A market leading Life insurer is looking to bring in a Senior Moses Modeller to cover maternity leave for 12 months.
Product Development Actuary Rob Bentham
Capital Actuary Kaylash Kukadia
South West Up to £800/day - 9 Months
Supporting the delivery of High profile Projects. Relevant skills: ICA/Solvency II & Financial reporting.
A well respected asset manager is looking to bring in a Senior Product Developer to cover maternity leave for 9 months.
Valuation/Systems Actuary Kaylash Kukadia
South Locations £700/day - 6 Months
Pricing/Systems Actuary Kaylash Kukadia
South East & London £700/day - 5 Months
Good analysis skills and IT understanding. Ability to understand and communicate requirements.
South West & Midlands £600/day - 6 Months
Experience of illustrations systems, across a broad product range.
Life Insurance - UK
Contracts - Life - UK
General Contact Details
Clare Nash David Parker Mehwish Raza Rachel Kelly
Rob Bentham Kaylash Kukadia
actuary@ojassociates.com
Web
www.ojassociates.com
ACT.02.13.056/57.indd 57
0207 649 9350 0207 310 8649 0207 117 6159 0207 310 8579
0207 649 9351 0207 310 8581
January/February 2013 • THE ACTUARY
57
Please contact one of the team for further information on any of the opportunities above.
29/01/2013 12:13
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Europe Zurich, Switzerland CHF170,000+
Team Leader Risk Analysis Audrey Dresen
Zurich, Switzerland CHF140,000+
Senior Pricing – Reinsurance Audrey Dresen
Growing reinsurance firm looking to expand its state of the art Risk Modelling team with a senior candidate. You have a modelling background, Solvency II experience, analytical mindset, complemented with excellent communication skills.
Fantastic opportunity to join a start-up reinsurance firm on the Casualty Pricing side. You have solid experience in the European market, can create your own pricing approaches, bring new ideas and love to implement new methodologies.
Senior Pricing Actuary – London Market Experience Dublin Patrick McMahon €100,000 - €150,000 + Package
Reporting Actuary Patrick McMahon
My client, part of a larger group, insure a diverse portfolio of business from its operation in Lloyd’s and offices around the world. They have a unique opportunity for a Senior Pricing Actuary with London Market experience in their office in Dublin.
I am working with one of Ireland’s most dynamic Life insurers. Due to expansion my client has a number of opportunities including an interesting role for a nearly/newly qualified reporting actuary and Solvency II actuaries.
Europe / Asia International Financial Risk Manager €80,000 + Bonus + Bens Julien Fabius
Senior Valuation Actuary Laurence Baken
We are currently recruiting for the international mobility pool of a major insurance group with subsidiaries in Europe and Asia. When joining this pool you will start in the Brussels office to be educated within the group on their financial risk management and prepared for a career as expat within one of the international offices. Please contact us for more info.
Global insurer seeks an actuary with extensive experience with valuation. An exceptional opportunity to influence the development of their internal model of Solvency II and IFRS Phase II, consulting senior management on MCEV calculations.
Reinsurance Officer Niels Van Nieuwkerk
Amsterdam €50,000 - €65,000 + Benefits
Non-Life Actuary Julien Fabius
Dublin €80,000 - €85,000 + Benefits
Brussels €60,000 - €80,000 + Bonus + Bens
Amsterdam €75,000 + Secondary Conditions
As a Reinsurance Officer you are the link between the actuarial team, underwriters and reinsurance brokers. You will be responsible for structuring information for the business, management board and the reinsurance manager. You will optimise processes and reinsurance contracts and work closely with the actuarial dept on the internal model and Solvency II. Non-qualified actuaries will be considered for this role.
You will join a well known international insurer, specialised in commercial lines with a close link to the London market. You will assume a broad actuarial role where you will work on pricing, reserving but also on Solvency II. On the pricing side you will work closely with the underwriters in Paris, Belgium and Holland. Open to part qualified Actuaries.
Brussels Risk Model Validation Consultant €60,000 - €80,000 + Bonus + Bens Laurence Baken
Capital Modelling Actuary Emina Biscevic
Your chance to join an international consultancy of model validation experts. Solid numerical background, possibly PHD with modelling / validation experience in an ALM or risk management department is required. You will contribute to innovative validation methodologies within a fast paced environment with a global reach.
Reinsurance company seeking a Capital Modelling Actuary to join small team. After an initial 6 month introductory period, you will be seconded to the London office for 2 years. Tasks: capital modelling duties including model development and implementation and ensuring Solvency II compliance. Direct reporting line to Group Head of Capital. Great opportunity to gain work experience abroad.
Reserving Actuary – Commercial Lines Manuel Lovell
Germany €€€Competitive
My client is looking for an experienced actuary to lead a small team in the reserving and analysis team of this international insurer. You will be involved in both review of reserves and business planning to help with growth.
Solvency II Actuary Benjamin Moses
Mainland Europe Up to €1400/day - 6-9 Months
High demand for actuarial skills in all three pillars of Solvency II across numerous projects. Contact us for more information.
Life Insurance Risk and Pricing Officer Manuel Lovell
North Rhine-Westphalia €€€Competitive
Munich €€€Competitive
You will be the central point in life product approval and risk mitigation for the company on a global basis. You will be working closely with local teams and the group CRO to work on strategies for High Risk Life Products.
Prophet/Moses Developers The Netherlands Helger Wiese Up to €1000/day - 3 Months + Extensions Demand for both Moses and Prophet Developers on Dutch market. Ideally Dutch speaking.
Europe Benjamin Moses Helger Wiese Emina Biscevic Laurence Baken Patrick McMahon
ACT.02.13.058/59.indd 58
+49 (0)89 2206 1068 +31 (0)20 262 0280 +49 (0)89 3803 8965 +32 (0) 2 401 2249 +353 (0)1 685 2413
Audrey Dresen Julien Fabius Niels van Nieuwkerk Manuel Lovell
+41 (0) 43 508 0444 +31 (0)20 716 8450 +31 (0)20 716 8327 +49 (0) 89 2206 1003
28/01/2013 08:58
Asia Head of Corporate Development - Life Gary Rushton
Hong Kong £££Competitive
My client a leading name in the Asia insurance market is currently looking for an experienced qualified actuary to focus on corporate development, most notably M&A across the region. The successful candidate will have a broad actuarial background with a solid understanding of financial reporting accompanied by strong communication skills.
Hong Kong £££Competitive
Group Actuary - Life Gary Rushton
I am looking for a relatively senior actuary to work within my European clients group function to support and oversee the group reporting requirements covering MCEV, IFRS. The role will report directly in the Asia FD and will also incorporate involvement in the Solvency II programme.
Corporate Actuary - Life Philip Chau
Hong Kong £££Competitive
Leading life insurer seeks flying actuary to be part of their reporting team. This is a fantastic opportunity for a nearly/newly qualified actuary to gain exposure on projects across capital, Solvency II, reporting and risk management.
Senior Pricing Actuary - GI Toby Weston
Shanghai £££Competitive
Superb opportunity to work as a Senior Pricing Actuary for a truly global business. Working on all lines of business this role will involve liaising with Finance, Capital and ERM functions to maximise product profitability.
Portfolio Director - Life Gary Rushton
Hong Kong £££Competitive
A unique opportunity for a commercially minded actuary looking for non-traditional work focusing on driving the value of my clients current portfolio of business within Hong Kong. Reporting to the CFO you will set and implement the strategy across key business units to ensure retention of the most profitable books of business.
Senior Product Actuary - Life Alex Ince
Hong Kong £££Competitive
Leading insurer is seeking a commercial actuary who can lead the revamp of the product suite across Asia. Great opportunity to gain an understanding of the numerous markets within Asia within a role which is very much in the spot light. Necessary interaction with non-actuarial stakeholders.
Appointed Actuary - Life Alex Ince
Hong Kong £££Competitive
Highly successful European insurer is seeking an experienced actuary to join their team in Hong Kong. The key focus is to be the appointed actuary for both HK and Singapore and to help build a local and regional team. Exciting opportunity to part of a fledgling business beginning its expansion in Asia.
Casualty Actuary - GI Toby Weston
Hong Kong £££Competitive
We are looking for an experienced pricing actuary to join a first class re-insurance business in Hong Kong. Working across the Asia Pacific Region, this candidate will be responsible for the pricing of all Casualty Lines Products.
Asia Market Update by Jonny Plews The Future is Bright - The general outlook for the global insurance industry is mixed, a consequence of consistently changing economic, market and regulatory circumstances. However, whilst the rest of the world is mired in economic instability, the Asia Pacific markets have seen continued growth. For 2013 it looks like another exciting year too with “The World Bank” predicting a 7.6% growth across the region and it is widely thought that future years will see this growth rising exponentially. The insurance sector itself is at the forefront of this growth, with the region expecting to contribute more than half of global premium growth over the next ten years. Actuaries Relocating - It is unsurprising then that the actuarial community is growing very quickly here. Actuaries from all over the world are relocating to Asia to help put foundations in place, roots that will equip insurance companies to accommodate this rapidly developing market. On our radar alone, over 120 qualified actuaries relocated to Asia in 2012, and I expect that figure to be consistent in 2013. A goal for any emerging market though is to become self-reliant, and they will achieve this by producing talent locally, not by relocating people. Foreign workers are currently training the next generation, but once these students move into management positions there will no longer be a need to relocate overseas talent. There is a window of opportunity right now in Asia, take advantage of it. Skills Required - The actuarial skills required here have not changed. We need people with strong technical skills (EV, EEV, MCEV, UK/US/ IFRS GAAP, Capital, Solvency II…) and we are seeing an increasing number of pricing, product development and marketing roles. Risk management awareness and regulation is also increasing here so actuaries with the capability of working in quantitative AND qualitative roles continues to be important. The main change however is that a majority of mid to senior roles now prefer people who have had experience working in Asia. One of the my top clients, a leading European insurer, will not even consider candidates for leadership roles unless they have experience in Asia, as they feel the candidates will fall short of cultural understanding. Many of the senior actuaries reading this article will have spoken to me over recent months and will have been turned back for these exact reasons. Location and Languages - Actuaries are needed in every country here. For those in North Asia (China, Taiwan, Korea & Japan) languages will be required though for Hong Kong and South East Asia (Vietnam, Thailand, Cambodia, Malaysia, Indonesia & Singapore) English is the only pre-requisite. For any further information on any of the above please contact me on the below details. If you are a nearly/newly qualified up to mid-management NOW is the time for you to move here. Asia needs your skills but that window will start closing soon. For senior actuaries, the window is already closing so if you are interested in learning more then please get in touch soon.
Asia Jonny Plews Alex Ince Gary Rushton
+852 5804 9200 +852 5804 9224 +852 5804 9223
Toby Weston Philip Chau
+852 5804 9042 +852 5804 9287
Please contact one of the team for further information on any of the opportunities above.
ACT.02.13.058/59.indd 59
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www.the-arc.co.uk
The Actuarial Recruitment Company
A fresh approach
Actuarial Analyst London
General Insurance Circa £50K
This varied role within a small London Market actuarial team would allow suitable individuals to have extensive involvement in the reserving and capital work of the team as well as to have exposure to development of pricing models, rate reviews, business planning and exposure monitoring. Candidates will need to be progressing well with the actuarial exams and have good communication skills. Ref: ARC25680
Head of Pension Risk Management South
Pensions £Significant
This large financial services provider is looking for a qualified pensions actuary or experienced risk manager with DB pensions management experience. A major element of this role will be a focus on understanding the capital and profitability implications of a large scheme, and this is a new position which will sit within the Capital function. The successful individual will be responsible for quantifying and reporting pension risk working with executive management. Ref: ARC25923
Capital Analyst London
General Insurance Circa £80K
This role working for a specialist P&C insurer and reinsurer will be involved in the development and running of the company’s internal capital model for ICA and Solvency II requirements. The role requires an individual with the interpersonal skills to interact well with the business in embedding the capital work within the company. First class technical skills are required with extensive previous experience in capital and a sound knowledge of Solvency II. Igloo knowledge would be an advantage. Ref: ARC25922
Actuarial Analyst London
Investment/Life Insurance £Attractive
This role will suit an individual who is on the way towards qualification or is qualified by experience. The successful will assist in designing, managing and evolving end-to-end customer and distribution offerings for guaranteed investment offerings within a Wealth Management portfolio. The role requires significant interaction with other parts of the organisation including marketing, compliance & legal, sales & business development and hence excellent communication skills are required. Ref: ARC25924
Call us anytime including evenings and weekends on 020 7717 9705 or email enquiries@the-arc.co.uk General Insurance Andy Clark BSc FIA General Insurance & Contracts Roger Massey BSc MBA FIA New Entrant (All) & Life/Pensions Chris Cannon BA CFI DAT
0781 333 7891 0781 398 9016 0771 122 8449
andy@the-arc.co.uk roger@the-arc.co.uk chris@the-arc.co.uk
The Actuarial Recruitment Company is an employment agency
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