A C T U A R I A L C A R E E R S A N D U B C
(by Joel Friedman, based on the Society of Actuaries visit, 2012; and partially
based on an earlier document by Joel Friedman, Harry Joe, Peter Kiernan, and
Tan Wang)
(Last modified August 25, 2014)
(1) GENERAL INFORMATION
The actuarial profession offers satisfying and lucrative careers for students
who are talented in mathematics and statistics and have good communication
skills, with an interest in business and finance. Actuaries work with
financial problems involving uncertainties, dealing with various types of
insurance, annuities, pension plans, and similar situations.
There is a steady but, unfortunately, not large demand for actuaries. In
Vancouver the demand is relatively small; it is significantly greater in
Toronto, and in numerous cities in the US (and other continents). The exams
are very demanding, so prospective actuaries should be honours students or very
strong majors students in either arts or science.
The Society of Actuaries is the largest organization responsible for educating
and certifying actuaries; their websites contain a wealth of information on
most aspects of the actuarial profession; see:
http://soa.org http://riskisopportunity.net/ http://beanactuary.org
Part of becoming an actuary involves passing a sequence of exams given by the
Society of Actuaries and obtaining some educational credits. The exam sequence
is completed when one is working for an actuarial firm; before applying to an
actuarial firm, one should have already passed some of the exams and obtained
some of the education credits. In today's market one should probably have
passed at least two actuarial exams before applying to actuarial firms for a
position.
(2) ACTUARIAL STUDIES -- GENERALITIES
An education suitable to actuarial studies would include a fair amount of
technical studies, namely mathematics and statistics, coupled with enough
commerce and economics studies to understand the practical issues involved; the
career also requires good written and oral communcation skills (this would
be apparent during an interview).
There are two formal requirements to being certified as an actuary: (1)
Actuarial Exams, and (2) VEE Credit (Educational credit). For the exams you
can register at the SOA, and will take the exam at an appointed place and date;
one can find study materials at the SOA website for each exam, and one can also
purchase third party exam study guides. The Educational credit can be
certified by various courses, but each of the three credits can be obtained, at
least at present, via one or two three-credit UBC classes, open to all UBC
undergraduates.
For more information on the exams, see, for example:
http://beanactuary.org/exams/preliminary/?fa=preliminary-exams
For more information on the VEE Credit, see, for example:
http://beanactuary.org/exams/preliminary/?fa=vee-requirements
Informally, you will want to consider which classes to take. While most
actuarial students major in mathematics or statistics, actuarial studies are
open to students in any major, and it is more important which courses you take
than what is the name of your major. There is no single set of classes to
take at UBC; most actuarial students will take many statistics and
mathematics classes, some commerce and/or economics. At UBC there are no
courses (at present) that are designed for a specific Actuarial Exam;
there are specific UBC courses used to fulfill the Educational Credits.
There are MANY career paths open to students who take actuarial related classes
(in finance, business, statistics, etc.). Furthermore, if you take an
Actuarial Exam or two and decide not to pursue an actuarial career, the
Actuarial Exams you pass will still make a statement on your resume/CV.
(3) UBC AND ACTUARIAL STUDIES
UBC has, at present, no formal actuarial program. Despite this fact, UBC was
rated (as of 2012) 69th of over 1000 universities in terms of education
credits. This is an exceptionally strong actuarial showing for a school
without a formal actuarial program, indicating a strong interest in
actuarial studies. As of recently, all of the educational
credits can be obtained through UBC courses to which all students have access.
(4) EXAMS
There are currently five "Preliminary Exams" given by the SOA, CIA (Canadian
Institute of Actuaries), and CAS (Casualty Actuarial Society). It is
recommended that students begin with the two exams:
Probability Exam (Exam P in the SOA system, Exam 1 in the CAS system)
Financial Mathematics Exam (Exam FM to to SOA, Exam 2 to the CAS)
Of these two, most people that Exam P first, although there is no real
reason to do so, and some may find it easier to begin with exam FM.
The other three exams are more advanced, then are:
Models for Financial Economics Exam (Exam MFE or 3F)
Life Contingencies: These are different for the SOA (Exam MLC) and CAS (3L)
Construction and Evaluation of Actuarial Models Exam: Exam C or 4.
More more information, see:
http://beanactuary.org/exams/preliminary/?fa=preliminary-computer-based-exams
(5) VEE CREDIT
In addition to the exams, actuaries are required to fulfill certain "VEE
credits." Such credits is obtained by taking courses in three areas:
(i) Economics, (ii) Corporate Finance, and (iii) Applied Statistical Methods
Typically you must take one or two three-credit courses to fulfill these
requirements. You can apply to get such credit after you have passed two
exams. Your courses must be approved by the SOA for the particular credit
that you want.
There are two ways to get a set of courses approved for VEE credit: (1) you
may take a set of courses that has already been approved ("pre-approved"
courses), which you can see (for any university, world-wide) at:
https://store.soa.org/Home/VEESchoolSearch/tabid/323/Default.aspx?VEE=displayonly
or (2) you can apply to have the particular courses count for the credit
you want to claim.
Generally speaking, if a sequence of courses was approved for a VEE credit in
the past, they will also be approved for the VEE credit in the future provided
that the courses' content hasn't changed much. If you would like to get a
course pre-approved, a UBC Actuarial Advisor can apply for pre-approval; if you
would like me to apply for pre-approval, please email me which courses you
would like approved and provide as much material (the links to webpages with a
detailed course outline, other course materials, etc.) as possible.
In the past, the following courses have been approved: (consult to above
website to make sure that they are presently approved!!!)
(i) Economics: 101 and 102; 310 and 311; 301 and 302; 500 and 502 (all ECON).
(ii) Corporate Finance: COMM 473; COMM 397 or 370 and COMM 374.
(iii) Applied Statistical Methods: STAT 306 and STAT 443 or 447K.
You must fill out an application with the SOA to obtain this credit, and
you may only receive this credit after you have passed two actuarial exams.
At present, you must obtain a grade of B- or better in each course for
which you are applying for credit. You must make the application yourself,
after you have completed a course and provide a transcript showing your
grade. I can apply to pre-approve a course, i.e., have it declared valid
for VEE credit before you take it, but you will still have to apply for
your VEE credit yourself, and you can get the course approved (provided it
meets the SOA requirements) at the time you apply.
(6) RECOMMENDED COURSES
It is recommended that you take first year calculus (two semesters of various
first-year math calculus sequences), MATH 200, MATH/STAT 302, STAT 305, STAT
306. This will give you an introduction to basic math and statistics that are
needed for Exams P and FM.
Beyond that, you should take a number of MATH and STAT classes, and some
ECON and COMM; consider those courses for which you can obtain VEE credit;
recommended MATH courses are 307 and 340.
(7) STUDYING AND THE FIRST EXAMS
After taking MATH/STAT 302 you will have seen most of the material needed
for Exam P. You should look at the sample exams provided by the SOA and
the list of exam topics, and make sure that you fill in any gaps in your
education required for Exam P.
To help you study, you can purchase study materials (print or electronic)
from a variety of companies listed by the SOA and CAS. The SOA list is
available at:
https://www.soa.org/education/exam-req/resources/edu-sem-workshops.aspx
The company ACTEX is probably the oldest such company and comes well
recommended (www.actexmadriver.com), but I understand that there are many
other companies whose study materials are equally as good.
Again, the first exams people usually are Exam P and Exam FM. Regardless
of which exam you are taking, you should look at the list of exam topics
and some sample exams to fill any gaps in your education.