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Actuarial Science

 

 

 

Department of Statistics
146 Middlebush Hall
University of Missouri - Columbia
Columbia, MO 65211-6100
Phone: (573) 882-6376
Fax: (573) 884-5524

This webpage is designed with the intention of providing useful information for Undergraduate and graduate students interested in pursuing a career in Actuarial science.

The Society of Actuaries has approved the following: Students who complete Stat 4510/7510 (old Stat 385) AND Stat 4870/7870 (old Stat 386) with a grade of C or better are eligible for VEE credit for Applied Statistical Methods. For more information, click here.

Table of Contents

          What is Actuarial science?

            What is an Actuary? 

            What are the society of actuaries exams?

            How should I prepare for the exams?

            Which courses are helpful in preparing for SOA exam 1?

            Professional opportunities

            Useful Links and Contacts

 

 What is Actuarial science?

Actuarial science is the science of applying mathematical and statistical  models to improve financial decision-making by evaluating the financial implications of uncertain future events.                            

 What is an Actuary?

An actuary is a professional concerned  with the financial evaluation of risk. They  design and administer insurance programs, pensions, government welfare plans and similar financial  plans . The main responsibility of  actuaries is to ensure that these plans operate on a sound financial basis. To do this they use many areas of mathematics ( for example:  probability theory, statistics, the theory of interest) as well as general principles of economics and finance.

Actuaries are experts in risk management. In particular, actuaries are involved in the design, pricing, financing, and operation of benefit plans which protect people from risks of injury, illness, death, property damage, and the loss of income due to unemployment or retirement. Actuaries use mathematical skills to create and manage programs that reduce the adverse financial impact of life's expected and unexpected events, including financial risks from investment. For more information read the definition of  "Actuary" according to the U.S. department of labor's occupational outlook handbook.

What are the society of actuaries exams?

You become an actuary by passing a series of professional examinations conducted by the Society of Actuaries (SOA) and by developing your professional skills while working at an insurance company, consulting firm, or some other similar organization. A college degree is essential in order to pass the actuarial professional examinations. A mathematics or statistics major is highly recommended, since passing the professional examinations requires a thorough understanding of mathematics and statistics. Also knowledge of finance, insurance and investments, excellent communication skills and computer programming skills are necessary.

The SOA exams are offered two times each year, in Fall and Spring. University of Missouri-Columbia is a SOA examination center location.  For more information on the exams schedule, locations, registration procedures and deadlines click here.

How should I prepare for the exams?

here is some information regarding the society of actuaries exam 1:

Exam 1 covers basic elements of Calculus, Probability and Interest Theory. Basically the only statistics prerequisites are STAT 4750 (7750 Graduate) and STAT 4760 (7760 Graduate). Here is a more detailed list of material you need to study:

  • Limits, series, sequences and functions;

  • Derivatives of single and multivariate functions (maximums, minimums, constrained maximums and minimums, rate of change);

  • Integrals of single and multivariate functions, simple differential equations;

  • Parameterized curves;

  • General probability (set functions, basic axioms, independence);

  • Bayes' Theorem;

  • Univariate probability distributions (probabilities, moments, variance, mode, percentiles, transformations);

  • Multivariate probability distributions (Central Limit Theorem; joint, conditional and marginal distributions-probabilities, moments, variance, covariance).

For more information on exams check SOA website, where you can find old exams, study material and a list of suggested textbooks.

Which courses are helpful in preparing for SOA exam 1?

Taking the following courses are recommended:

          STAT 4750 (7750 Graduate) :  Introduction to Probability Theory

          STAT 4760 (7760 Graduate) : Statistical Inference

          MATH 1500 : Calculus I

          MATH 1700 : Calculus II    

          MATH 2300 : Calculus III

          FINANC 1000 : Principles of Finance

 

Professional Opportunities

Actuarial employment opportunities are typically available in the following types of organizations: health, life, property, and casualty insurance firms; actuarial and employee benefit consulting firms; health service organizations; insurance rating bureaus; large industrial corporations; labor unions; federal government agencies; and state insurance departments. You can find links to some of major actuarial firms in the useful links and contacts section.

Useful links and contacts

Here is a list of some useful links and contacts:

     Actuarial organizations:

         SOA, CAS, The Actuarial Foundation, Midwest Actuarial Forum.

    Actuarial Firms

          Hewitt Associates,  PriceWaterhouseCoopers, Tillinghast-Towers Perrin,

          Buck Consultants (Mellon),  Watson Wyatt Worldwide, Trustmark Insurance,

          William M. Mercer.

     Actuarial Recruiters

         D.W.Simpson, NAS, The Emereald Group, H&H Associates.

     Other sites

          Actuary.com, Be an actuary.org, Graduate programs in Actuarial science.