Skip to main content
The Actuary: The magazine of the Institute and Faculty of Actuaries - return to the homepage Logo of The Actuary website
  • Search
  • Visit The Actuary Magazine on Facebook
  • Visit The Actuary Magazine on LinkedIn
  • Visit @TheActuaryMag on Twitter
Visit the website of the Institute and Faculty of Actuaries Logo of the Institute and Faculty of Actuaries

Main navigation

  • News
  • Features
    • General Features
    • Interviews
    • Students
    • Opinion
  • Topics
  • Knowledge
    • Business Skills
    • Careers
    • Events
    • Predictions by The Actuary
    • Whitepapers
    • Moody's - Climate Risk Insurers series
    • Webinars
    • Podcasts
  • Jobs
  • IFoA
    • CEO Comment
    • IFoA News
    • People & Social News
    • President Comment
  • Archive
Quick links:
  • Home
  • The Actuary Issues
  • September 2013
09

Technology: Win or lose

Open-access content Tuesday 3rd September 2013 — updated 5.13pm, Wednesday 29th April 2020

Graham Robertson explains the advantages of embracing technological advances – and the consequences of ignoring them

2

Recent technological advances have given insurers more data and processing power than ever before. Insurers are using new information, such as driving telematics, to better understand customer behaviour. They are also changing their business models to keep pace with the outside world. Gone are the days when management information was out of date by the time it reached executives. Managers want real-time information on which to base decisions, and technology has caught up. Real-time business scenarios can be run remotely on phones and tablets. So, with this backdrop, how will actuaries evolve to keep up?

Understand the data

Having lots of data is one thing, but the ability to segment this data in multiple ways allows managers to understand the business better. The same is true of financial results and performance indicators. Visualisation tools can help to digest information in order to get to the root cause of trends or results quickly, and allow drill-down into particular segments. This information can better inform business plans and scenarios, giving an insurer competitive advantage, and actuarial input into their design is paramount.

—

Technology in a global world

Global insurers should use technology that can be accessed, executed and reported upon from anywhere in the world. Consistency across business segments drives quicker and better understanding by management and leads to better decisions.

As an example, consider a global insurer, whose planning process involves linking together large numbers of spreadsheets to get to its business plan. The planning process takes considerable time and new iterations of the plan cannot be achieved quickly. Producing the business plan requires much manual intervention in data processing and that time could be better used formulating the strategy and plan itself.

 

Compare this with a global insurer that has a consistent enterprise planning solution, accessible from any country and requiring minimal set-up or manual intervention. More time can be spent on planning and analysis to help to ensure business success. Add in extra technology-driven capabilities such as reforecasting, integration with the capital model and scenario modelling, and you quickly see how much value is derived from having better technology.

Horsepower = insight

Improved technology also enables more extensive data capture and manipulation. Available data has reached a level that is changing the way we model risks. We see this in driving telematics, where continuous data on driving ability is being used to analyse risks more accurately.

Analysing large data sets has been problematic historically but is becoming achievable as technology advances. Increased processing power has enabled enhanced techniques, and newer actuarial disciplines, such as predictive modelling, have taken a quantum leap forward. Analytics teams are running intelligent algorithms on large data sets to provide new insights. Trends and indicators emerge to inform judgements.

Where do actuaries fit in?

Actuaries must strive to be at the centre of these initiatives. Combining our insurance insight with advanced modelling will take the industry forward. Actuaries do not need to be experts in technology, but we do need to understand it to improve our contribution. The profession has come a long way - from pencil and paper, through spreadsheets, and onto enterprise tools and advanced analytics. More accurate, relevant, transparent modelling, using superior technology, will optimise decision-making, and actuaries should lead this initiative. Our expert judgement will be enhanced and this will benefit our profession, the industry and consumers.

This article appeared in our September 2013 issue of The Actuary .
Click here to view this issue

You may also be interested in...

2

Interview: Philip Booth

Nick Silver and Sarah Bennett meet the free market actuary, economist and programme director at the Institute of Economic Affairs
Tuesday 3rd September 2013
Open-access content
2

Big challenges, creative solutions sustainability conference

Dr Candice Howarth and Tracey Zalk review the Global Sustainability Institute's inaugural conference
Wednesday 4th September 2013
Open-access content
2

Resilience through reinsurance

From diplomats and technical experts to risk managers of the new millennium, Neil Ramage looks at the evolution of the reinsurance industry
Friday 30th August 2013
Open-access content
2

Pensions: The right balance

An intelligent asset rebalancing strategy can help to reduce pension scheme risk. George Tyrakis discusses the possible approaches – and potential pitfalls
Thursday 12th September 2013
Open-access content
2

The environment: The carbon bubble

Catherine Cameron, Elisa Hewlett, Simon Jones and Paula Robinson evaluate the current carbon budget commitment and the implications for fossil fuel investments
Tuesday 3rd September 2013
Open-access content
2

President's comment: A question of pension relevance

David Hare outlines the IFoA’s work in the pensions space, including defi ned ambition, tax treatment and defined contribution
Wednesday 4th September 2013
Open-access content

Latest from September 2013

Stable outlook for French insurers, says S&P

French insurers could enjoy greater ratings stability through 2014 despite lingering downside risks, a Standard and Poor report said today.
Wednesday 13th November 2013
Open-access content
ta

Towers Watson: US firms taking steps to de-risk DB schemes

A growing number of US employers are planning to de-risk their defined benefit pension plans a Towers Watson's survey revealed today. Plans are benefiting from rising interest rates and improved equity performance.
Tuesday 12th November 2013
Open-access content

Van Hulle warns on damaging effects on Solvency II delays

Solvency II delays will ‘hurt’ European insurers and compromise their ability to deliver protection for their clients in a ‘riskier world’, a senior pensions and insurance expert warned today
Monday 30th September 2013
Open-access content

Latest from small_opening_image

2

COVID-19 forum for actuaries launched

A forum for actuaries has been launched to help the profession come together and learn how best to respond to the deadly coronavirus sweeping the world.
Wednesday 25th March 2020
Open-access content
2

Travel insurers expect record payouts this year

UK travel insurers expect to pay a record £275m to customers this year as coronavirus grounds flights across the world, the Association of British Insurers (ABI) has revealed.
Wednesday 25th March 2020
Open-access content
2

Grim economic forecasts made as countries lockdown

A sharp recession is imminent in the vast majority of developed and emerging economies as the deadly coronavirus forces businesses to shut down across the world.
Tuesday 24th March 2020
Open-access content

Latest from 09

Modelling: Mastering the correlation matrix

Phil Joubert and Stephen Langdell explore the challenges of setting valid correlation matrices for risk modelling
Monday 9th September 2013
Open-access content
ta

Actuaries: the next Luddites?

Vicki Zhang argues that actuaries should embrace technological developments, and adapt their skill sets and mindsets to avoid becoming obsolete
Friday 30th August 2013
Open-access content
Share
  • Twitter
  • Facebook
  • Linked in
  • Mail
  • Print

Latest Jobs

Exposure Management Analyst

London, England
£40000 - £50000 per annum
Reference
148639

Pricing - Casualty Actuary

London (Central)
£128K + bonus + benefits
Reference
148638

Reporting Contractor

Negotiable
Reference
148636
See all jobs »
 
 
 
 

Sign up to our newsletter

News, jobs and updates

Sign up

Subscribe to The Actuary

Receive the print edition straight to your door

Subscribe
Spread-iPad-slantB-june.png

Topics

  • Data Science
  • Investment
  • Risk & ERM
  • Pensions
  • Environment
  • Soft skills
  • General Insurance
  • Regulation Standards
  • Health care
  • Technology
  • Reinsurance
  • Global
  • Life insurance
​
FOLLOW US
The Actuary on LinkedIn
@TheActuaryMag on Twitter
Facebook: The Actuary Magazine
CONTACT US
The Actuary
Tel: (+44) 020 7880 6200
​

IFoA

About IFoA
Become an actuary
IFoA Events
About membership

Information

Privacy Policy
Terms & Conditions
Cookie Policy
Think Green

Get in touch

Contact us
Advertise with us
Subscribe to The Actuary Magazine
Contribute

The Actuary Jobs

Actuarial job search
Pensions jobs
General insurance jobs
Solvency II jobs

© 2023 The Actuary. The Actuary is published on behalf of the Institute and Faculty of Actuaries by Redactive Publishing Limited. All rights reserved. Reproduction of any part is not allowed without written permission.

Redactive Media Group Ltd, 71-75 Shelton Street, London WC2H 9JQ