We are independent & ad-supported. We may earn a commission for purchases made through our links.
Advertiser Disclosure
Our website is an independent, advertising-supported platform. We provide our content free of charge to our readers, and to keep it that way, we rely on revenue generated through advertisements and affiliate partnerships. This means that when you click on certain links on our site and make a purchase, we may earn a commission. Learn more.
How We Make Money
We sustain our operations through affiliate commissions and advertising. If you click on an affiliate link and make a purchase, we may receive a commission from the merchant at no additional cost to you. We also display advertisements on our website, which help generate revenue to support our work and keep our content free for readers. Our editorial team operates independently of our advertising and affiliate partnerships to ensure that our content remains unbiased and focused on providing you with the best information and recommendations based on thorough research and honest evaluations. To remain transparent, we’ve provided a list of our current affiliate partners here.
Education

Our Promise to you

Founded in 2002, our company has been a trusted resource for readers seeking informative and engaging content. Our dedication to quality remains unwavering—and will never change. We follow a strict editorial policy, ensuring that our content is authored by highly qualified professionals and edited by subject matter experts. This guarantees that everything we publish is objective, accurate, and trustworthy.

Over the years, we've refined our approach to cover a wide range of topics, providing readers with reliable and practical advice to enhance their knowledge and skills. That's why millions of readers turn to us each year. Join us in celebrating the joy of learning, guided by standards you can trust.

What does a Life Actuary do?

By Karize Uy
Updated: May 17, 2024
Views: 4,853
Share

In general, the main responsibility of a life actuary is to calculate the probability that a certain incident can happen to an individual and compute the cost it can produce. Most incidents are accidents and diseases. In this way, actuaries come up with relatively accurate statistical rates of fatalities, disabilities, and sicknesses.

Once the statistics are available, the life actuary then computes for the price of a certain insurance policy for the beneficiary. These policies vary according to the client’s needs, desires, and situation. Insurance companies need actuaries to calculate probabilities in order to ensure their insurance policies can safely cover clients. At the same time, companies want to guarantee they still can make some profits.

Aside from accidental and natural casualties and deaths, calculating for risks in disasters and unemployment may be included in the tasks of a life actuary. These factors are also important in computing for insurance policy rates. Sometimes, even a client's job is included as a variable when calculating the risk factors. Generally, when people have high-risk jobs, such as pilots and firefighters, their insurance policies are more expensive than those with low-risk jobs, such as an office personnel or a stay-at-home parent. A life actuary can also play a significant role in creating investment and savings plans, which are beneficial for an individual or a family in the future.

Being a life actuary requires some specialized skills and knowledge. Most, if not all, actuaries are graduates with college degrees related to mathematics, statistics or business administration. They should also pass several actuarial exams to qualify for a position. Aside from their mathematical skills, life actuaries should also be knowledgeable about economic trends, as this will be an important element in all statistical data. Insurance companies also deal with many legal technicalities that actuaries should be aware of, so a background in law education may also be an advantage.

Life insurance actuaries are very valuable because their expertise in numbers and statistics helps provide the clients financial coverage for any unexpected events in their lives. Companies also consider actuaries assets because not everyone possesses their very specialized skills. In fact, a 2010 research study crowned the actuary as the best job in the US. For someone who likes to make sense of the world through numbers, being an actuary can be a fulfilling vocation. With many economic trends requiring analysis, the demand for a life actuary may increase.

Share
WiseGeek is dedicated to providing accurate and trustworthy information. We carefully select reputable sources and employ a rigorous fact-checking process to maintain the highest standards. To learn more about our commitment to accuracy, read our editorial process.

Editors' Picks

Discussion Comments
Share
https://www.wisegeek.net/what-does-a-life-actuary-do.htm
Copy this link
WiseGeek, in your inbox

Our latest articles, guides, and more, delivered daily.

WiseGeek, in your inbox

Our latest articles, guides, and more, delivered daily.