General Insurance Article - The importance of changing trends to actuarial work

The Joint Forum on Actuarial Regulation (JFAR) has today published its Risk Perspective: 2018 Update setting out its collective view on current risks to high quality actuarial work.

 In its report the JFAR - a collaboration between regulators involved in actuarial work - has reconfirmed nine distinctive risk hotspots impacting actuarial work. The hotspots relate to current or emerging risks which, due to their changing nature or level of uncertainty, pose increased risk to the public interest. These are:

 political and legislative risk;
 regulatory change;
 market performance and uncertainty;
 climate-related risk;
 financial security;
 pension scheme management;
 technological change - automation and digitisation, Big Data, Artificial Intelligence and cyber risk;
 terrorism and cyber-crime; and

 It is recommended actuaries take these hotspots into account when advising decision-makers and collaborate with other experts and users of actuarial work to mitigate the risk to the public interest. Technological change in the transport industry, for example, is occurring at a rapid pace and may require changes to the data, models or assumptions currently used by actuaries. New technology like pay-as-you-drive apps could dramatically alter the claims experience for motor insurers and actuaries should ensure their advice to decision-makers reflects the latest developments.

 While hotspots should be monitored by actuaries to enable them to provide risk mitigation, many may also give rise to opportunities. For example, actuaries may be able to help users model climate-related risks, use new data sources to help design products for vulnerable groups, or advise on the new types of pension schemes coming out of Department for Work and Pensions consultations.

 Stephen Haddrill, CEO of the Financial Reporting Council and Chair of the JFAR, said: “Actuaries play a key role advising decision-makers across a wide range of subjects and industries including the insurance, pensions and investment industries. We live in a time of relentless change affecting all aspects of society and the economy which increases risk and uncertainty for actuarial work. By raising awareness of these risk hotspots and sharing knowledge, the JFAR hopes to encourage actuaries, employers and users of actuarial work to collaborate effectively, to mitigate the risks to high quality actuarial work and to explore opportunities in the public interest.” 

 In 2017, the JFAR introduced its Actuarial Risk Identification Architecture (ARIA) to identify risk hotspots. The ARIA is used to review the macro environmental drivers, risks inherent in actuarial work and the market characteristics which currently lead to an increase in risk. This year the JFAR reconfirms the continuing relevance of the nine hotspots, provides an update on the key developments over 2018 for each and provides links to further reading so that actuaries, their employers and users of actuarial work can continue to make informed decisions.

 Read the full report Risk Perspective: 2018 Update 

Back to Index

Similar News to this Story

Aviva urges fire safety as lockdown leads to home incidents
Aviva is urging residents to take extra care as a growing number of people report fire incidents at their homes. The insurer has seen an increase in c
Covid19 impact on workplace and supply chain in power sector
Pressures on workforce availability and maintaining supply chains arising from COVID-19 are proving challenging to the power sector, according to Will
The Covid19 Risk Outlook report
The world’s response to the Covid-19 has precipitated a total transformation of the workplace. Virtual working requires a fundamentally new digital op

Site Search

Exact   Any  

Latest Actuarial Jobs

Actuarial Login

 Jobseeker    Client
Reminder Logon

APA Sponsors

Actuarial Jobs & News Feeds

Jobs RSS News RSS


Be the first to contribute to our definitive actuarial reference forum. Built by actuaries for actuaries.