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Actuarial Science sub-topic
Do you smoke cigarettes, go mountain climbing, or love to hang glide on vacation? For most people, answers to these questions just help to get to know you better. For professionals in the field of actuarial science, these high-risk behaviors will determine if you are someone their company wants to insure, and if so, at what rate to make the risk worthwhile.
Actuarial science applies mathematics and statistical methods to assess risk in the fields of insurance, healthcare and finance. It became a formal mathematical discipline in the late 17th century due to the growing demand for long-term insurance coverage that included payment for burial, providing life insurance to make sure loved ones can maintain their lifestyle after the death of the primary money maker in the family, and to set up an annuity payment formula that provides adequate funds in a person’s later years.
According to Investopedia.com (www.investopedia.com/terms/a/actuarial-science.asp), traditional actuarial science largely revolves around the analysis of mortality and the production of life tables, as well as the application of compound interest.
Today, actuarial science includes probability theory, finance, advanced statistics, calculus, economics and computer science. The age of computers has made it easier for actuaries to estimate future contingent events, such as the rates of mortality by age. The field has benefitted from the development of mathematical techniques for discounting the value of funds set aside and invested. This led to the concept of realizing the present value of a future sum.
In an era when health insurance rates are constantly being debated, actuarial science is right at the heart of the issue. Actuaries focus on the rates of disability, mortality, morbidity, and fertility to provide health insurance companies with the information they need to determine rates for patients, doctors, and hospitals. Professionals in this field help to design benefit structures and reimbursement standards. In addition, they analyze the effects of proposed government standards on the cost of healthcare.
Evolution of Actuarial Science
According to the Society of Actuaries (SOA), founded in 1889, (https://www.soa.org/about/historical-background) the field of actuarial science began in 1693 when Edmond Halley developed a mortality table. Its initial major growth occurred in the mid-18th century when James Dodson created the “level premium system” in 1762. His system led to the forming of the Society for Equitable Assurances on Lives and Survivors in London. Another breakthrough during this period was Richard Price’s textbook on life contingencies in 1771.
In North America, actuarial science took off in the early 1800s. Jacob Shoemaker, of Philadelphia, was the first company actuary on this continent in 1809. He helped to organize the Pennsylvania Company for Insurances on Lives and Granting Annuities.
Many life insurance companies formed in the mid-1800s, including New York Life and Trust Company in 1830. In the 1840s, mutual life insurance was created in North America. Two of the largest companies to form were Mutual Life of New York and New England Mutual in Boston, Massachusetts.
In 1904, both George A. Huggins in Philadelphia and George B. Buck in New York City led actuarial expertise into the pension field. Huggins was an authority on pensions for clergy. Buck guided New York City government officials on the best way to set up municipal pension systems.
In the 1950s, major life insurance companies led the way in issuing modern health insurance policies. The SOA added health insurance into its educational curriculum.
The growing prestige of the field was reflected in both 1988 and 1995 when the Jobs Rated Almanac named the actuarial profession the best job in America. CareerCast (https://www.careercast.com/) followed suite in 2010 when it ranked being an actuary as the number one job in the United States.
A Lucrative Field for Those Who Love Math
Actuarial science is a great field for students who love math to consider as their profession. It pays well, and gives professionals an opportunity to help businesses and clients develop policies that minimize the cost of risk caused by potential events. Actuaries are at the center of decisions that help companies invest wisely to garner the best profits possible and to offer more services to clients.
Students interested in this field need a bachelor’s degree. They must pass a series of exams to become certified. People entering the actuarial field need a strong background in math, statistics, and business.
Many major universities offer majors in actuarial science. According to www.universities.com, Columbia University offers the top program in the nation. The rankings of www.collegechoice.net puts Purdue University at the top, with the Milwaukee School of Engineering, Carnegie Mellon University, Ohio State University, Temple University, the University of Pennsylvania, Florida State University and the University of Wisconsin close behind.
According to the Bureau of Labor Statistics (www.bls.gov), actuaries will be increasingly needed to develop, price and evaluate a variety of insurance products, as well as calculate the costs of new, emerging risks. It estimates a 22% growth in this field through 2026 – much higher than average for all professions.
The Bureau reports that the median pay for actuaries was $101,560 a year in 2017. There were 23,600 jobs in the actuarial sciences in 2016, according to the BLS.
According to www.payscale.com, actuaries in the United States average $83,000 a year. With bonuses and profit sharing, most actuaries are making over $100,000 a year. At the higher-end, an actuary can earn over $160,000 a year with salary, bonuses and profit sharing.
Since we have tutors in all Actuarial Science related topics, we can provide a range of different services. Our online Actuarial Science tutors will:
With these capabilities, our college Actuarial Science tutors will give you the tools you need to gain a comprehensive knowledge of Actuarial Science you can use in future courses.
Our tutors are just as dedicated to your success in class as you are, so they are available around the clock to assist you with questions, homework, exam preparation and any Actuarial Science related assignments you need extra help completing.
In addition to gaining access to highly qualified tutors, you'll also strengthen your confidence level in the classroom when you work with us. This newfound confidence will allow you to apply your Actuarial Science knowledge in future courses and keep your education progressing smoothly.
Because our college Actuarial Science tutors are fully remote, seeking their help is easy. Rather than spend valuable time trying to find a local Actuarial Science tutor you can trust, just call on our tutors whenever you need them without any conflicting schedules getting in the way.
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