Actuaries salary & career outlook
If you've always been a math buff, then becoming an actuary may be an excellent career choice for you. An important addition to a number of businesses, the actuary profession continues to grow, attracting college graduates and those looking for a career change.
What actuaries do
According to the Bureau of Labor Statistics (BLS), actuaries analyze the financial costs of events such as death, an accident, a natural disaster or sickness (BLS.gov/ooh, 2012). By using financial theories, statistics and mathematics, they assess the likelihood of an event like this happening and help businesses and clients with minimizing the cost of that risk or event by putting forth policies.
Other duties actuaries may do include:
- Designing and administering pension plans, insurance policies and investments
- Producing tables, charts and reports that explain proposals and calculations
- Explaining findings and proposals to clients and businesses
- Health insurance: Develop long-term health insurance and long-term care policies by predicting the estimated costs within the terms of an insurance contract.
- Property and casualty insurance: Develop insurance policies against property loss and liability in the event of accidents, fires, natural disasters or other events.
- Life insurance: Develop life insurance polices for groups or individuals by estimating, based on a number of health and biological factors, how long someone is going to live.
How to become an actuary
Actuaries typically have a strong background in mathematics and an undergraduate degree in mathematics, business, statistics or actuarial science, according to the BLS (BLS.gov/ooh, 2012). Many employers also expect students to pass one of the initial actuary exams before graduation that are required for professional certification. Becoming certified not only requires students to complete coursework in economics, corporate finance and statistics, but also requires students to take exams through either the Casualty Actuarial Society or the Society of Actuaries.
Actuary salary trends
The BLS reports that as of May 2012, the national mean annual wage of actuaries was $106,680 (BLS.gov/oes, 2013). The May 2012 BLS data also shows that the highest 10 percent of earners made an annual wage of $175,330 and the lowest 10 percent earned $55,780. In that same year, actuaries in the top three paying industries made an annual mean wage of:
- Federal Executive Branch: $115,560
- Agencies, brokerages and other insurance related activities: $115,430
- Management, scientific and technical consulting services: $115,030
- Kansas: $138,670
- New York: $134,460
- Vermont: $117,510
Career outlook for actuaries
According to the BLS, employment of actuaries overall is projected to grow by 27 percent between 2010 and 2020 (bls.gov/ooh, 2012).
In the insurance industry, employment of actuaries is expected to grow by 25 percent, since there are new insurance and healthcare laws that actuaries will be needed to develop, price and evaluate, the BLS reports. In property and casualty insurance, more actuaries will be needed due to climate change. Not as much growth is expected for actuaries in life insurance because consolidation in the industry is expected to limit new job creation.
The largest employment growth is expected in consulting services, at 58 percent between 2010 and 2020, the BLS reports (BLS.gov/ooh, 2012). This stems from a continuing need to do contract work for insurers and to manage and evaluate employee benefit plans. Also, more industries are expected to use consulting actuaries to assess risks in several different areas.