Role of Actuaries of India the current situation
Actuaries are risk managers that specialise in estimating the financial impact of future uncertain events. They enable financial decisions to be made with more confidence by:
· Analyzing the past
· Modeling the future
· Assessing the risks involved
· Communicating what the results mean in financial terms
The actuarial curriculum is designed to provide actuaries knowledge of the subjects like, mathematics, statistics, economics, accountancy, finance, investments, insurance, pension, risk management, financial modeling and communication. This subject knowledge is used to make the financial decisions.
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However, in the current situation, the level of disruptions has increased. Actuaries with their skills of assessing the financial impact of future uncertain events are uniquely placed to add value by enabling businesses and individuals to make better-informed decisions, with a clearer view of the likely range of financial outcomes from different future events.
What are the best approaches in which actuaries can decode the disruption and respond effectively to combat various challenges?
Actuarial skills are valuable for any business managing long-term financial projects both in the public and private sectors. As mentioned earlier, actuaries are the experts of several subjects including the modeling for future uncertain events. This profession has risen to the occasion to help manage climate change risk, volatile financial markets, demographic risks under pandemic, low interest rate regimes, changing customer demands and disruption in the business models. The role of actuaries is helping economies grow and providing societies financially freedom. As they are equipped and skilled to help the industry to manage the emerging risks and challenges.
How actuaries are becoming a mainstream in India?
The Actuarial profession was established in India around 78 years ago when Actuarial Society of India was established in the year 1944. Since then, this profession has come a long way. Liberalization of the insurance industry, growth in the economy, financial inclusion, inclination in the Indian society to become financially secured has fuelled the demand for actuarial talent from insurance and pension companies of India. Today, Actuaries are adding value in wider areas, as well.
To tap the skilled talent, global financial services firms are setting up their technology, actuarial, financial and risk management units in India. We are seeing increased demand for actuaries in areas of IFRS 17, risk management, pricing, underwriting, reserving, regulatory reporting, data science and machine learning. This has opened a large number of opportunities in India, as they would also be able to provide support in the work on few emerging areas like modeling of cyber risk, climate change risk, etc.
How will actuaries’ skills prepare the new business leaders to understand and manage day-to-day business risks?
The Actuaries’ skills in analysis and modeling of problems in finance, risk management and product design are used extensively in the areas of insurance, pensions, investment and more recently in wider fields such as data science, project management, banking and health care. Within these industries, they perform a wide variety of roles such as – design and pricing of product, financial & risk management and corporate planning. Actuaries are invariably involved in the overall management of insurance companies and pension, gratuity and other employee benefit funds schemes; they have statutory roles in insurance and employee benefit valuations to some extent in social insurance schemes sponsored by the government.
The application of professional rigor combined with a commercial approach to the decision -making process, sets apart Actuaries from other professions.
What are your upcoming initiatives for young actuaries?
We as a team are very happy to announce that the numbers of young actuaries are increasing over a few years. This may be as a result of the few initiatives we have taken at the Institute, like counselling, coaching of a few subjects, and availability of the online coaching module for the preparation of the actuarial examinations.
We have recently restructured the Institute including creation of a Placement Officer to engage employers. We believe that the support to the students and young actuaries is very essential in the area of placement. The placement Officer works closely with employers and has built Internship and Placement Programs for students and members. We reach out to technology, consulting, captives, banks, insurance and other firms to tap the best actuarial talent across India.
We have also initiated Job Oriented Training for our members and students for upskilling them. These trainings help them to expand, upgrade and strengthen the skills in demand by the employers. In the past few months the IAI has conducted programs in R, Python and Machine Learning. A program on IFRS 17 is scheduled. Program on pricing, reserving, risk management, banking, data science, IFRS 9 is being planned.
IAI has partnered with India Insurtech Association to provide its members and students access to the Insurtech firms and can collaborate with each other for knowledge sharing.
What are your expansion plans towards accelerating the country’s vision?
To participate in the growth vision of the Indian economy to USD 5 trillion, and to leverage the demographic advantage, we made the strategic decision of realizing the dream of IAI 2.0. The transformation aims to connect, empower, and involve Gen Z and millennials better. IAI is digitizing its students and members services. It is transforming its education and training methodology and delivery with its engagement with employers and start up industry, financial institutions, regulators and government. The ultimate purpose is expansion of the profession, empowering members and students, growth for industry, economy and the society, as well.
To engage, encourage and support the Gen Z in line with the National Education Policy 2020, the IAI has decided to conduct Olympiad in Actuarial Science for Indian Students (OASIS). The OASIS covers the CBSE and ICSE syllabus of mathematics, statistics, data science and information technology up to class XII. OASIS aims to enable generation Z to take the informed decision about their career and to attract the bright students to the profession and prepare them for future.
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About Mr. Subhendu Kumar Bal
Mr. Subhendu Kumar Bal is the Chief Actuary and Chief Risk Officer of SBI Life Insurance Company. He has an industry experience of more than 28 years in several life insurance companies.
He has worked in SBI Life for over 13 years. Prior to joining SBI Life, he has worked for three other private insurance companies. He has also worked with the Life Insurance Corporation of India before moving to the private life insurance sector.
Mr. Bal possesses all actuarial functions and some non-actuarial functions of a life insurance business. He was a Visiting Faculty of a Management Institute, teaching courses on Life & Health, Group and Risk Insurance Management. He is a Fellow member of Institute of Actuaries of India (FIAI) and a post graduate in Statistics from Calcutta University.
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Request NowHe is President of Institute of Actuaries of India and served as Honorary Secretary and Chairperson of an advisory group of Examination committee and an ex-chairperson of advisory group of HR, Admin and Finance Committee of Institute of Actuaries of India. He was an examiner for the actuarial papers of Institute of Actuaries of India for several years.
He has participated in several international seminars and discussions on actuaries and life insurance.
He has been awarded “Best Actuary – Life Insurance” at the ‘3rd Insurance Alertss Conclave and Excellence Awards -2019’
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