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The Actuary The magazine of the Institute & Faculty of Actuaries
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GI: The changing role of ASTIN

For many years, our profession has prided itself on the numbers of actuaries with UK qualifications that work overseas, perhaps 30% to 40%. Many are overseas actuaries who have taken the UK exams. For some UK actuaries, this move entailed a temporary overseas posting, whilst for others, the journey was permanent, satisfactory and one way. This situation was most prevalent in the days when UK actuaries worked mainly in the life assurance market, but it still continues today.

In the non life insurance market, the UK profession has had more than its fair share of domestic pioneers, but there is now considerable scope for our skills to be exported. However, we must first let the rest of the world know that we are here, and that we are able to produce.

Since the pangs of birth in the 1960’s and then the 1970’s (when general insurance was introduced into the UK actuarial syllabus and exams), the numbers of non life actuaries have increased dramatically. When tasked with organizing the 1984 GIRO convention, we had to consider how to house 80 actuaries for a couple of days. Nowadays, the current GIRO committee has the unenviable task of providing for over 500 delegates, a sizeable proportion of all UK general insurance actuaries, and in a country not really geared up for large conventions.

In those remote days, we were starting from scratch and competing with just a handful of statisticians and other insurance practitioners, but there was an obvious need and increasing demand for our services. Our task then at GIRO was mainly in developing and justifying the fundamentals. Now we are clearly at the sharp end of the insurance industry and our input is fully expected and appreciated by others within that industry. This has undoubtedly been a success story for our profession, but it would be extremely short-sighted for us to rest on our laurels.

The insurance marketplace has changed significantly recently, and will do so even more in the near future. The UK insurance industry used to be a national one operating under the auspices of the UK Department of Trade and Industry. Now, we have our European neighbours and partners involved with our regulation and influencing how we operate. Even worldwide insurance supervision may not be that far away. It is essential that we must not only influence those in other countries in how we wish our UK industry to operate and to perform our role in the UK, but we must also listen to what actuaries and others say in those other countries. They will have quite different concerns and priorities from us, and so what they say and do, and how they influence those that draft the European regulations will significantly and inevitably affect us.

The International Actuarial Association (IAA) has far more influence than even a few years ago. As an example, the International Accounting Standards Board would now seek the views of the appropriate IAA committee before progressing very far on certain issues such as risk margins and discounting. So even now, the IAA affects how actuaries operate in the UK. Also, consider how the framework for Solvency II has been driven from a EU rather than a national UK perspective. It is vital that UK general insurance actuaries cease being so parochial and become more involved in the IAA, as we must have a material input to international as well as national issues, as they all affect us.

The equivalent of GIRO in the worldwide International Actuarial Association is ASTIN. Regrettably, very few UK actuaries actively and regularly participate in ASTIN colloquia, and only about 10% of UK general insurance actuaries even belong and subscribe to ASTIN. Historically, there were reasons for this remoteness but we cannot afford for this to continue. Whilst GIRO dealt with practical and parochial issues, ASTIN tended to deal with very theoretical topics. ASTIN papers tended to deal with complex mathematical issues and included advanced statistical formulae that did not appeal to UK actuaries. Could we really understand them? In the UK, we wanted to solve our practical problems instead and deal with emerging issues that affected and concerned our insurance clients.

However, just as GIRO has changed, so has ASTIN. The emphasis at ASTIN is now far more on the practical issues that affect the worldwide insurance market. Most obviously and importantly Solvency II, but also climate change, stochastic techniques, financial modelling, securitisation, extreme value and other very practical and topical issues are the main discussion points and focus of most recent papers at ASTIN.

The ASTIN Committee has resolved to continue to address the historical issues and to encourage cross border cooperation in the makeup of working parties. Authors of papers produced for national conventions have been encouraged to enhance their papers where appropriate so that they are appetising for an international audience. Indeed, the GIRO Committee, and appointed representatives from the CAS, the Australian Institute and others have been cooperating to achieve a wider circulation and audience of papers. It is always a shame when an excellent paper or concept is kept within the boundaries of one country and does not cross the frontier.

The UK General Insurance actuaries have been famous for their sense of entrepreneurship, enterprise, imagination and energy. We must export much more of our work and encourage others to do so. Of course, this means more work for UK actuaries who already have significant demands on their time. However, being an international body there are compensations, such as travelling to other countries (the 2011 ASTIN is to be held in Madrid, Spain, astin2011.org, the 2012 ASTIN in Mexico City and ASTIN 2013 in The Hague in the Netherlands), and there are no problems at all with languages, as English is universally spoken, written and read in these actuarial circles.

So it is vital for the UK profession that we look beyond our frontiers, attend the ASTIN colloquia and let a much larger audience be aware of what we in the UK are doing and where we want to go (boldly).

If you wish to find out more about how to get your general insurance actuarial ideas to a much wider audience, please contact me or a member of the GIRO Committee.

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Colin is a self employed actuarial consultant with over 30 years experience as a general insurance actuary. He has been active within the profession, an Institute Council member and has presented papers and spoken around the world as well as attending many GIRO, CAS and ASTIN conventions. He currently is on the Committee of ASTIN, the non life section of the International Actuarial Association.

Colin J W Czapiewski FIA MAAA FSAI FPSA colin@czapiewski.co.uk