If you search the internet, you will find a variety of descriptions about what an actuary is. What follows are just a few of them.
"An actuary is a business professional who analyzes the financial consequences of risk." Society of Actuaries, USA
"Actuaries analyze the financial costs of risk and uncertainty. They use mathematics, statistics, and financial theory to assess the risk that an event will occur and to help businesses and clients develop policies that minimize the cost of that risk." US Bureau of Labor Statistics
"Actuaries analyze statistical data, such as mortality, accident, sickness, disability, and retirement rates, and construct probability tables to forecast risk and liability for payment of future benefits." CNN Money Magazine, 2009
"Actuaries are experts in risk management. They use their mathematical skills to help measure the probability and risk of future events." Institute and Faculty of Actuaries, UK
Despite this variety, you will notice some common elements within these descriptions: risks, uncertain events and consequences. Actuarial science is indeed principally concerned with risk and uncertainty. It is a unique discipline that applies mathematics, statistics, business and several other diverse disciplines in the measurement and understanding of risks. Actuaries construct mathematical and statistical models to understand risk and uncertain events, predict the likelihood of their outcomes, and measure the financial implications. If you enjoy math, you will find yourself using a lot of your quantitative skills when you practice as an actuary.
Although actuarial science is a discipline not widely familiar to the layman, everybody on the planet is touched, affected, and influenced by it. From the moment we are born, we face various forms of risks and uncertain events at every tick of the moment following each day of our lives. We all want to mitigate or minimize their financial and economic consequences. This is what actuaries do for us: analyze risks, evaluate the consequences, and examine possible ways to minimize the effect.
To demonstrate, we make sure that we have enough financial protection when faced with risk and uncertainty; insurance is one of the many ways we can mitigate many of these risks. We make sure we are covered when we get in an accident, when our property is damaged by fire or hurricane, when we get ill, or when we live a longer retirement period. Actuaries are considered experts in insurance and financial risk measurement and management. They are often employed by insurance companies, banks, pension and consulting firms, and other financial institutions. You will find that the scope of their skills can be applied in many areas of the financial services industry.
The actuarial profession has been for several years consistently ranked as one of the most desirable professions in the United States.
Read Josh Sober’s article, “Thinking about becoming an actuary?”
Engineering and Actuarial Science? Read a story here from ME Bulletin Fall 2012, with quote from Albert Cohen.