John Taylor, new president of the IFoA, shares his views on the ways in which the actuarial world is being affected by the inexorable rise of data science

It's been suggested that, in their approach to Big Data, actuaries are 'the original data scientists'. What, in their essentials, do actuaries have in common with data scientists?
When I heard actuaries described as 'the original data scientists', I really liked the phrase. It captures the essence of what actuaries have been doing for centuries. If you look back at the pioneers of the profession, they were analysing what at the time were large data sets to do with longevity, trying to find the truth and insight in them and then extrapolate into the future. Then if you look back just a decade or two, actuaries did similar things around stochastic asset models - again, trying to make projections into the future. And that's the essence of what data scientists try to do. The tools and technology used have moved on massively, of course, but the fundamentals of trying to extract truth and insight from data, and then using that to infer something about the future, are the same.
Why are actuaries so well placed to explain data science? And can data scientists learn from actuarial practice?
What actuaries bring is a sense of business context, commercial value, and what it all means for their client - be it a pension scheme, an insurance company, or the ultimate end-user, the consumer. Having that sense of business context, as an overlay to the raw insights that a data scientist may bring, makes those insights more useable and valuable to the client.
The IFoA plans to launch a data science certification. What will be its scope and what will members who undertake it gain?
There's an appetite among IFoA members to learn more about data science, and so we are about to launch a certificate in data science, available to all members of the actuarial profession. They'll be able to choose from a set of five modules that cover disciplines such as data visualisation, artificial intelligence and machine learning. They can choose the order in which they would like to do them, and those who complete the set of five will be awarded the certificate. From this, actuaries will get a much greater appreciation of the art of the possible in data science.
The traditional fields for actuaries have been insurance and pensions. Now actuaries are appearing in agriculture, healthcare, climate change initiatives and even ride-sharing app development. How does this reflect the way data science is developing?
Data science is empowering for actuaries; it bestows the ability to re-engineer what they do in traditional fields, and gives them a platform to move into wider fields. The underlying driver behind this is that other industries, which haven't been so accustomed to dealing with data, are now being deluged with it. And they don't really quite appreciate how to derive value from it. Bringing in a profession that's long been expert in dealing with that data, and getting insight out of it, is a tremendous opportunity for those industries - even for creative industries, such as advertising. The 'Mad Men' of TV series fame are being replaced by the 'Math Men', as advertising becomes much more data-driven about defining individual segments and offering bespoke propositions - and actuaries are getting involved in that kind of innovation.
What makes the contribution of the actuarial profession so uniquely valuable to the emerging field of data science?
As professionals immersed in a business context and in understanding the impact companies can have with end-users, actuaries are well placed to add value and utilise the insights data scientists can generate. Let me give you an example. I know an actuary who works in insurance, and who is looking at new ways to deliver services to existing clients - and that's about understanding individual customers at a very small level of detail, and looking for trigger points when they might be receptive to new service offerings. This approach is really transforming the take-up rate for services.
The IFoA's Certificate in Data Science will be launched in spring 2020. We are seeking to create a library of actuarial data science case studies. The aim is to support the delivery of the certificate and provide those taking the certificate with opportunities to maintain and evaluate their knowledge through the CPD process. Case studies may be set in the traditional actuarial domains, or in new and emerging areas, and could include some practical opportunities for members to engage with data science techniques in the workplace.
More details, including how to apply, are at bit.ly/23JRCTb