1 minute read 29 Oct 2020
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What is the future of actuarial in insurance?

Authors
Jean-Philippe Larochelle

Americas Life & Annuity Actuarial Analytics Leader Senior Manager, Insurance and Actuarial Advisory Services, Ernst & Young LLP

Actuary passionate about solving the challenges facing the life insurance and annuity industry. Serves many companies throughout North America, and is committed to advancing the actuarial profession.

Michael Hughes

EY Americas Insurance Actuarial Transformation Leader

My goal is to help clients succeed in their most complex challenges. It’s time for leaders to align their focus and teams to the growth, profitability and innovation challenges facing the industry.

Dave Czernicki

EY US Actuarial Modeling Leader

Focused on actuarial financial modeling and associated insurance transformations.

1 minute read 29 Oct 2020
Related topics Insurance Financial Services
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Actuarial teams can set a bold vision to help drive transformational change in a period of unprecedented opportunities and challenges.

In brief

  • To solve today’s complex business problems, actuaries need to embrace new technology and work as part of integrated cross-functional teams to develop and implement solutions.
  • The challenge and opportunity for actuarial leaders is to flip their focus from process and compliance activity to strategic agenda and value creation.
  • For actuarial leaders looking to drive change within their organizations, step one is to define a compelling mission, vision and purpose to rally and mobilize the team.

The insurance industry, like many, is rapidly evolving and innovating in response to persistent growth challenges and key global megatrends like low interest rates, technology innovation customer and distributor expectations and demographics. The challenges and changes facing insurers, while difficult, are also opportunities for transformative change. Agile companies with a strategic focus can emerge as industry leaders, stronger than ever.

The financial management community at insurers (broadly including finance, risk, actuarial and investments) are facing increased pressure to successfully navigate change and drive growth while lowering costs. The need for these teams to work closely together has never been greater.

This paper outlines how actuarial leaders can set a bold vision and help drive transformational change to thrive in a period of unprecedented challenges and opportunities for the industry.

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We recently polled actuarial leaders for their thoughts on the future of actuarial. 

Here’s what we heard:

Mission or vision statements

23%

of respondents currently have a mission or vision statement for actuarial, while others may develop one in the future.

For those with such statements, some of the common elements included:

  • Value-add partnerships
  • Providing relevant, reliable, complete and timely insights
  • Better integration of data, technology and processes

Strategic focus

In order of relative emphasis in the next 3-5 years, respondents indicated that financial reporting and analysis, projections and experience monitoring/assumption setting will be at the top of their agenda.

Strategic focus going forward

The biggest change in focus going forward is customer value, where 75% expect increased emphasis.

2011-3618944_Dividends Market Scan_summary for participants (DRAFT)_v1

Technology toolkit

75%

of respondents feel that the actuarial technology toolkit – including automation, workflow, data management and business intelligence - will have the highest impact on their actuarial organization in the near future.

Impact of emerging technology chart

Resourcing options 

Working remotely during the pandemic has actuarial leaders evaluating whether to flex their historical location strategies to access a much broader and diverse talent pool. Offshore resources, managed services, data scientists and gig/contract workers were also expected to be of medium to high importance.

Importance of resourcing options chart

How EY can help

Finance, risk and actuarial change

In many companies, finance, risk and actuarial capabilities have developed in silos, with new processes and technology gradually added to meet evolving requirements for financial reporting and regulatory compliance. We help our clients in the vision, design and implementation of target operating models to integrate and align towards their key organizational needs.

Read more

Summary

To help their business successfully navigate the winds of change in the insurance industry, actuarial leaders need to better integrate their teams with complementary skill sets in their organizations while inspiring and challenging their talented teams to set the bar higher and achieve more.

About this article

Authors
Jean-Philippe Larochelle

Americas Life & Annuity Actuarial Analytics Leader Senior Manager, Insurance and Actuarial Advisory Services, Ernst & Young LLP

Actuary passionate about solving the challenges facing the life insurance and annuity industry. Serves many companies throughout North America, and is committed to advancing the actuarial profession.

Michael Hughes

EY Americas Insurance Actuarial Transformation Leader

My goal is to help clients succeed in their most complex challenges. It’s time for leaders to align their focus and teams to the growth, profitability and innovation challenges facing the industry.

Dave Czernicki

EY US Actuarial Modeling Leader

Focused on actuarial financial modeling and associated insurance transformations.

Related topics Insurance Financial Services
Upvote