Code of Conduct Flashcards
Who is an ‘Actuary’ for purposes of the Actuarial Code of Conduct?
An individual who has been admitted to a class of membership to which the Code applies by action of any organization having adopted the Code.
What is an ‘Actuarial Communication’ for purposes of the Actuarial Code of Conduct?
A written, electronic, or oral communication issued by an Actuary with respect to Actuarial Services.
What is ‘Confidential Information’ for purposes of the Actuarial Code of Conduct?
Information not in the public domain of which an Actuary becomes aware as a result of providing Actuarial Services to a Principal. It includes information of a proprietary nature and information that is legally restricted from circulation.
What are ‘Actuarial Services’ for purposes of the Actuarial Code of Conduct?
Professional Services provided to a Principal by an individual acting in the capacity of an actuary. Such services include the rendering of advice, recommendations, findings, or opinions based upon actuarial considerations.
What is ‘Principal’ for purposes of the Actuarial Code of Conduct?
A client or employer of the Actuary.
What is Precept 1 of the Actuarial Code of Conduct?
An Actuary shall act honestly, with integrity and competence, and in a manner to fulfill the profession’s responsibility to the public and to uphold the reputation of the actuarial profession.
What is Precept 2 of the Actuarial Code of Conduct?
An Actuary shall perform Actuarial Services only when the Actuary is qualified to do so on the basis of basic and continuing education and experience, and only when the Actuary satisfies applicable qualification standards.
What is Precept 3 of the Actuarial Code of Conduct?
An Actuary shall ensure that Actuarial Services performed by or under the direction of the Actuary satisfy applicable standards of practice.
What is Precept 4 of the Actuarial Code of Conduct?
An Actuary who issues an Actuarial Communication shall take appropriate steps to ensure that the Actuarial Communication is clear and appropriate to the circumstances and its intended audience, and satisfies applicable standards of practice.
What is Precept 5 of the Actuarial Code of Conduct?
An Actuary who issues an Actuarial Communication shall, as appropriate, identify the Principal(s) for whom the Actuarial Communication is issued and describe the capacity in which the Actuary serves.
What is Precept 6 of the Actuarial Code of Conduct?
An Actuary shall make appropriate and timely disclosure to a present or prospective Principal of the sources of all direct and indirect material compensation that the Actuary or the Actuary’s firm has received, or may receive, from
another party in relation to an assignment for which the Actuary has provided, or will provide, Actuarial Services for that Principal. The disclosure of sources of material compensation that the Actuary’s firm has received, or may receive, is limited to those sources known to, or reasonably ascertainable by, the Actuary.
What is Precept 7 of the Actuarial Code of Conduct?
An Actuary shall not knowingly perform Actuarial Services involving an actual or potential conflict of interest unless: the Actuary’s ability to act fairly is unimpaired; there has been disclosure of the conflict to all present and known prospective Principals whose interests would be affected by the conflict; and all such Principals have expressly agreed to the performance of the Actuarial Services by the Actuary.
What is Precept 8 of the Actuarial Code of Conduct?
An Actuary who performs Actuarial Services shall take reasonable steps to ensure that such services are not used to mislead other parties.
What is Precept 9 of the Actuarial Code of Conduct?
An Actuary shall not disclose to another party any Confidential Information unless authorized to do so by the Principal or required to do so by Law.
What is Precept 10 of the Actuarial Code of Conduct?
An Actuary shall perform Actuarial Services with courtesy and professional respect and shall cooperate with others in the Principal’s interest.
What is Precept 11 of the Actuarial Code of Conduct?
An Actuary shall not engage in any advertising or business solicitation activities with respect to Actuarial Services that the Actuary knows or should know are false or misleading.
What is Precept 12 of the Actuarial Code of Conduct?
An Actuary shall make use of membership titles and designations of a Recognized Actuarial Organization only in a manner that conforms to the practices authorized by that organization.
What is Precept 13 of the Actuarial Code of Conduct?
An Actuary with knowledge of an apparent, unresolved, material violation of the Code by another Actuary should consider discussing the situation with the other Actuary and attempt to resolve the apparent violation. If such discussion is not attempted or is not successful, the Actuary shall disclose such violation to the appropriate counseling and discipline body of the profession, except where the disclosure would be contrary to Law or would divulge Confidential Information.
What is Precept 14 of the Actuarial Code of Conduct?
An Actuary shall respond promptly, truthfully, and fully to any request for information by, and cooperate fully with, an appropriate counseling and disciplinary body of the profession in connection with any disciplinary, counseling, or other proceeding of such body relating to the Code. The Actuary’s responsibility to respond shall be subject to applicable restrictions on Confidential Information and those imposed by Law.
When issuing a report, may an actuary suggest restriction on its circulation?
Yes. Annotation 8-1. An Actuarial Communication prepared by an Actuary may be used by another party in a way that may influence the actions of a third party. The Actuary should recognize the risks of misquotation, misinterpretation, or other misuse of the Actuarial Communication and should therefore take reasonable steps to present the Actuarial Communication clearly and fairly and to include, as appropriate, limitations on the distribution and utilization of the Actuarial Communication.
May an actuary provides services to a Principal if the actuary knows that the Principal has engaged another actuary on the same matter?
Yes. Annotation 10-2. A Principal has an indisputable right to choose a professional advisor. An Actuary may provide service to any Principal who requests it, even though such Principal is being or has been served by another actuary in the same matter.
For Precept 13, when is a violation of the code material?
Annotation 13-1. A violation of the Code is deemed to be material if it is important or affects the outcome of a situation, as opposed to a violation that is trivial, does not affect an outcome, or is one merely of form.
When a new actuary is retained, is an actuary required to provide proprietary information?
The Actuary need not provide any items of a proprietary nature, such as internal communications or computer programs. Annotation 10-5
Under the Code must an Actuary be available to answer questions about a report?
No, but he must identify the extent to which he is available to answer questions. Annotation 4-2. An Actuary who issues an Actuarial Communication should indicate the extent to which the Actuary or other sources are available to provide supplementary information and explanation.
