Actuaries are in a very good position to create solutions for society, says Deepak Jobanputra
Behavioural science and decision-making theory are areas that have been evolving rapidly and have captured the interest of the insurance industry. Links have been made to behaviours based on psychology and also through the identification of behavioural patterns using data.
With the vast expansion of the electronics industry and mobile technology, the volume of data being captured continues to grow at an unprecedented pace. Analysis of this, often very rich, data can be
used to create innovative business models. Some UK supermarkets have the led the way in capturing shopping habits and use this to market personalised offers. More recently, we have seen motor insurers adopting 'telematics' to reflect risk more accurately (see GI: Who is in the driving seat?).
These changes bring great opportunities for actuaries to create innovative solutions for society. They can also be intrusive. I recall a recent claim citing data and models that exist to predict accurately where an individual may be and what they are doing. This is clearly powerful information but raises other social questions.
Our president states that it is critical we take a leading role in this area of managing statistics and big data, noting we may have been seen as the only specialists in this area in the past but other professionals are becoming well-versed in these skills.
I believe actuaries can, and do, look to create solutions to improve society, and our contributions are generally aimed at building a strong future. This is supported by a potent statement from Paul Sharma, outgoing deputy head of the Prudential Regulation Authority in this month's interview. He states that actuaries have a strong sense of public service and we work well with multidisciplinary teams. This is a strong commendation, from a respected honorary actuary.
With the ever-changing world, be it, technology, globalisation, demographic change, climate change and more, there are so many opportunities for actuaries to make an impact as we have done in the traditional areas of life insurance, general insurance and pensions to name a few. Let's keep on leading the way in shaping the future.