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 June 27, 2012) (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 would also require good written and oral communcation skills (this would be apparent during an interview). There are two formal requirements to being certified as an actuary: (i) 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 VEE credit is obtained for 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. To see which UBC courses are SOA approved for these credits, consult: http://www.soa.org/Files/edu/edu-vee-dir-approved-courses.pdf 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. (5) 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.