I recently took part in a panel debate interview organised by Rick Huckstep from the Digitial Insurer. The write-up was titled: “Is the insurance Actuary an endangered species, or simply facing an evolutionary makeover?” and involved Geoff Keast (CEO of Montoux in North America) and Steven Mendel (Co-founder and CEO of Bought By Many).
Rick is one of my favourite InsurTech authors, so I knew he would do a good job of bringing up some interesting debate.
We covered many areas, and I’ve briefly summarised the top 13 key points below:
- 1As we enter the fourth industrial revolution and age of technology and automation, change is upon us. Many professions, including the 300 year old actuarial profession may be under threat.
- 2The digitial economy has led to an explosion of data. This data is emerging from many different sources and is also impacting the insurance industry (think IoT, Telematics, Wearables, etc).
- 3The non-actuarial “data scientist” is encroaching into actuarial work.
- 4Many actuaries are now adding machine learning to their toolkit and the actuarial profession is embracing this change.
- 5In the era of “data is the new oil”, actuaries may be able to use their skills to break into new non-traditional areas.
- 6Actuaries understand financial performance and policy-holder behaviour and hence they are the lifeblood of many insurance companies.
- 7We are likely to see a blending of actuarial and data science in the next five years.
- 8We are moving towards more dynamic pricing models as data increases in size and availability.
- 9New risks will emerge that will likely require actuarial expertise to understand (e.g. drone risk or liability from autonomous vehicles).
- 10We may see a shift towards growth outcomes (new business, customer retention, etc.) rather than the risk/compliance/ regulatory side of modelling.
- 11Automation may enhance the actuary’s work rather than leading to extinction. Assuming you are a forward thinking perpetual learning actuary!
- 12An actuary’s strong professional code of ethics provides an oversight which I think is particularly important for helping to ensure that we are using data ethically and responsibly.
- 13Being flexible and being able to adapt and grow is key for future actuaries.
