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The Actuary The magazine of the Institute & Faculty of Actuaries

Actuarial developments at Heriot-Watt

Heriot-Watt University has launched an ambitious strategy to set its direction to 2015 with the aim to place Heriot-Watt at the forefront of research and research-led education in the UK and internationally. Through the strategy it intends to set the agenda to reshape the University and, in so doing, grow its academic base by 50% in 10 years.

In order to deliver this ambition, the university has committed itself to growth and investment, both in staff and infrastructure. Some of this investment will be in developing and strengthening the academic staff across five key themes, one of which is highly relevant to actuaries. The theme is entitled Risk and Modelling.

Risk and its management are at the centre of modern living. The purpose of this theme is to align actuarial mathematics, statistics, psychology, computer science and engineering to deal with mathematical and behavioural aspects of risk and uncertainty. The approach at Heriot-Watt is to capitalise on the talents it already has in actuarial mathematics, probability and other related disciplines that deal with uncertainty and take an interdisciplinary effort which will allow it to tackle the real challenges of risk. A combined approach will encompass the quantitative behavioural and societal aspects of the problem and lead to practical solutions and mitigation strategies.

A major initiative includes establishing FRAME — Financial Risk and Actuarial Modelling, Edinburgh — a major expansion of Heriot-Watt’s actuarial and financial mathematics teaching and research, helping to understand quantitative risk and its management in financial services.

The University has also launched an MSc course in Quantitative Risk Management, to address future demand in the financial services industry for advanced risk modelling and risk management skills. In recent years, banking and insurance regulators have been concerned with the development of robust capital adequacy systems, and the current financial crisis suggests there is much work left to do.