As a practice area, the term “life insurance” encompasses a wide scope, including annuities, retirement savings products, group life and health insurance, disability insurance, and living benefits products – all of which are issued by life insurance companies. In fact, roughly 40% of CIA members are employed by life insurance companies or in roles that serve the life insurance industry, such as consulting. Actuaries employed by reinsurance companies (insurers for insurance companies) would also be included in this practice area.
Actuaries can fill several diverse roles within the operations of a life insurance company. These can include:
- pricing and product design – determining premium rates, developing actuarial models to measure profitability and sustainability;
- determining profitability, developing actuarial models, conducting experience reviews, setting key pricing assumptions such as mortality;
- underwriting, contract development, policy administration and distribution;
- valuation and financial reporting – determining the liabilities associated with policies, also known as reserves. This involves setting valuation assumptions, developing and maintaining valuation models and ensuring appropriate controls are in place; and
- surplus management, required capital reporting, risk management and asset-liability management.