Actuarial Advice

Question 1

Private sector stakeholders whom actuaries can advise

Answer 1

• insurance companies - policyholders, board of directors, shareholders, creditors, auditors

• benefit schemes - members (and their dependants), sponsors, trustees, auditors

• employers

• employees

• investment fund managers

• members of investment schemes

• sponsors of capital projects

• banks

• accounts holders

Question 2

Stakeholders of the public sectors actuaries can advise - give examples

Answer 2

Government departments

Related organizations, e.g. regulatory bodies

Question 3

Examples actuaries may advise on

Answer 3

Policyholders:
- personal protections against death and illness
- protection of property
- investment

Trustees of benefit schemes
- managing the assets of the scheme
- paying the benefits promised under the scheme as they fall due
- maintaining solvency

Sponsors of benefit schemes
- providing protection and retirement benefits that meet the needs of the members and their dependants
- managing the cost of providing the benefits
- meeting legislative requirements

The government
- setting and monitoring adherence to legislation
- funding benefit provision by the state and monitoring this funding

Question 4

Different types of advice that can be given

Answer 4

Indicative advice - an opinion

Factual advice - based on research of facts

Recommendations - involving research, modelling, consideration of alternatives

In giving advice the actuary should:
• set out alternative solutions and the implications of each solution to both the client and on other affected stakeholders
• outline the assumptions made and the reasons for making them

Question 5

The actuary should gather info about the client before analysis of a problem
Consider:

Answer 5

• information in the public domain, e.g. accounts, websites

• a pre-project meeting with the client

• attitude of the client, in particular risk appetite and culture

• potential conflicts of interest

• their circumstances and objectives

Results should be produced:
• in a comprehensible format and timely way
• taking into account the implications for all the stakeholders involved