Most actuaries fail communication exam
UK - The Actuarial Profession's communications exam is failed by almost two-thirds of those who take it, says Institute of Actuaries president Nick Dumbreck.
"Despite efforts to make the exam more user-friendly, the pass rate remains extremely low (34% at the April 2006 sitting), and this is highly unsatisfactory for what should be a very straightforward test," Dumbreck said in his inaugural presidential address at the Institute of Actuaries last night.
He acknowledged that actuaries are often criticised for being poor communicators - but stressed "the issues we are trying to communicate do not lend themselves to being reduced to a few simple messages".
"Communicating uncertainty is problematic," he said - adding it was time to re-open the debate about the Institute's motto ‘ Certum ex Incertis (‘certainty out of uncertainties').
The profession was facing competition from investment banks in terms of risk management, he acknowledged.
One new area of activity for the profession could be assessing the value of the pension fund sponsor's covenant, Dumbreck suggested.
"Actuaries would no not keep up to date are likely to find that they become obsolescent quite quickly."
"To some extent the outcome is in our own hands - if we can design products that provide worthwhile risk mitigation at an acceptable cost, then we will benefit from the opportunity to manage them."
Despite a current buoyant market for actuaries at present, "we are all conscious that this situation cannot last indefinitely, and that the numbers of actuaries working in the traditional actuarial strongholds will start to decline sooner or later".
"However, it is difficult to persuade actuaries to move into new areas when there is plenty of interesting, challenging and well-paid work in traditional fields.
"There has been some movement of actuaries into investment banks, but most of them are working on developing and promoting risk-mitigation products to organisations such as their former employers.
"The current boom in life and pensions work gives us a breathing space to prepare for what may be to come."