Institute and Faculty of Actuaries
The Institute and Faculty of Actuaries came into being on 1 August 2010 as a result of the merger of the Institute of Actuaries and the Faculty of Actuaries in Scotland after voting members of both bodies voted to merge their respective organisations in a ballot held on 25 May 2010.
Structure and governance
The Queen in Council granted an amendment effective 1 August 2010 to the Charter of the Institute of Actuaries in terms that converted it to the Charter for the Institute and Faculty of Actuaries. The assets, liabilities and membership rights of the Faculty of Actuaries in Scotland were transferred on this same day to the Institute and Faculty of Actuaries and the Charter of the Faculty of Actuaries in Scotland was surrendered. Essential elements of the merger arrangements, such as the Scottish constituency and its representation on the Council of the Institute and Faculty of Actuaries, are incorporated into the new governance documents.
The President of the Institute and Faculty of Actuaries (IFoA) is Colin Wilson. His term of office began on the 23 June 2016. He succeeded Fiona Morrison, who now takes of the title of Immediate Past President. The President-elect is Marjorie Ngwenya.
Research and member support
Actuaries work in a number of different practice areas: enterprise risk management, finance and investment, general insurance, health and care, life insurance and pensions.
Each of these areas is supported by an executive committee which oversees the development of knowledge and research within its own area, provides members with CPD opportunities and takes forward a programme of practice-specific research. The committees also foster a sense of community among actuaries practising in their particular field of expertise.
- Enterprise risk management - helping companies understand and manage risk in line with their business objectives
- Finance and investment - for actuaries working in banking, corporate finance and investment
- General insurance - rating products, advising on reserves and capital requirements, and similar general insurance activity
- Health and care - a growing area in both the private and public sectors as health provision models evolve to meet changing needs
- Life insurance - a traditional area for actuaries, with the roles evolving as life insurance itself evolves
- Pensions - actuaries play a key role in advising companies on all manner of pension schemes and structures.
Education and regulation
The Institute and Faculty of Actuaries sets examinations, continuing professional development, professional codes and disciplinary standards. The Financial Reporting Council (FRC) assumed responsibility for oversight of the actuarial profession and the independent setting of actuarial technical standards with effect from May 2006.
Fully qualified actuaries are Fellows and may bear the designations FIA or FFA while Associates bear the designations AIA or AFA.
Practising certificates are issued to certain actuaries for their statutory role in the financial management of life offices and most pension schemes. The Institute and Faculty of Actuaries continues the former Institute’s role as a designated professional body, under the Financial Services and Markets Act 2000, which enables it to license firms that are managed or controlled by actuaries, allowing them to carry on certain limited regulated activities.
An actuarial qualification from the Institute and Faculty of Actuaries consists of a combination of the completion of various examinations and courses. The examinations are split into four sections: core technical, core applications, specialist technical, and specialist applications. In addition to examinations and courses, it is required that the candidate both complete at least three years work as an actuary and to qualify as a Fellow.
An actuarial qualification from the Institute and Faculty of Actuaries consists of a combination of the completion of various examinations and courses. The examinations are split into four sections: Core Technical (CT), Core Applications (CA), Specialist Technical (ST), and Specialist Applications (SA). Study material for the examinations is usually obtained through the official bookshop of the Institute of Actuaries <ref =name>Bookshop, </ref> or through the Actuarial Education Company (ActEd),<ref =name>Acted The Actuarial Education Company</ref> a subsidiary of BPP Actuarial Education Ltd.
In addition to examinations and courses, it is required that the candidate complete at least three years work as an actuary to qualify as a “Fellow of the Institute and Faculty of Actuaries” (FIA) <ref =name>How to Register as a Student a student, The Actuarial Profession, Faculty and Institute of Actuaries, 2011-01-25</ref>
The Core Technical section consists of 8 written exams and a “Business Awareness Module,” CT9. These are usually sat first by a candidate and include the underlying mathematics involved in actuarial work as well as an introduction to financial and economic issues. These are also the most common exams for which candidates may get exemptions.
The Core Applications section consists of a 6 hour written exam and two practical exams which focus on the application of concepts learned and a candidate's ability to communicate actuarial concepts to others.
The Specialist Technical section is the first stage the candidate has a choice of which exams to take. The candidate chooses two from the various actuarial specialist subjects i.e. Health and Care, Life Insurance, General Insurance, Pensions, Finance or Investments and further technical knowledge on said subjects is attained.
Since the 2010 examinations, the General Insurance Specialist Technical paper ST3 was replaced by two subjects ST7 and ST8.<ref =name>How to Register as a Student a student, The Actuarial Profession, Institute and Faculty of Actuaries, 2011-01-25</ref>
The Specialist Applications section allows the candidate to choose one area for which they take the SA paper and attain full Fellowship; leading to many referring to this as the “Fellowship paper.” However, as the rules on the ordering of examinations were relaxed, this examination may be taken before taking some earlier examinations resulting in candidates qualifying on other papers.
List of Examinations
Core Technical Stage
- CT1 - Financial Mathematics
- CT2 - Finance and Financial Reporting
- CT3 - Probability and Mathematical Statistics
- CT4 - Models
- CT5 - Contingencies
- CT6 - Statistical Methods
- CT7 - Business Economics
- CT8 - Financial Economics
- CT9 - Business Awareness Module
Core Applications Stage
- CA1 - Actuarial Risk Management
- CA2 - Modelling
- CA3 - Communications
Specialist Technical Stage
- ST0 - Alternative Specialist Technical (not examined)
- ST1 - Health and Care Specialist Technical
- ST2 - Life Insurance Specialist Technical
- ST3 - General Insurance Specialist Technical (no longer available)
- ST4 - Pensions and other Benefits Specialist Technical
- ST5 - Finance and Investment Specialist Technical A
- ST6 - Finance and Investment Specialist Technical B
- ST7 - General Insurance - Reserving and Capital Modelling Specialist Technical
- ST8 - General Insurance - Pricing Specialist Technical
- ST9 - Enterprise Risk Management Specialist Technical
Specialist Applications Stage
- SA0 - Research Dissertation Specialist Applications
- SA1 - Health and Care
- SA2 - Life Insurance
- SA3 - General Insurance
- SA4 - Pensions and other Benefits
- SA5 - Finance
- SA6 - Investment
UK Practice Modules
For students working in the UK only
- P0 - Generic UK Practice Half Module
- P1 - Health and Care
- P2 - Life Insurance
- P3 - General Insurance
- P4 - Pensions
- P5 - Finance
- P6 - Investment
Certified Actuarial Analyst
This new qualification will be obtained after passing 6 modules. Module 0 tests basic mathematics (with a its syllabus based on the Foundational ActEd Course written by ActEd (The Actuarial Education Company)), Modules 1-4 tests parts of the CTs and Module 5 tests audit trails (CA2).
Certificate in Financial Mathematics
Any candidate worldwide can take the CT1 Financial Mathematics exam without being a member of the Actuarial Profession and if they pass, will receive the Certificate in Financial Mathematics.<ref =name>Certificate in financial mathematics, The Actuarial Profession, Institute and Faculty of Actuaries, 2011-01-25</ref>
Diploma in Actuarial Techniques
The Diploma in Actuarial Techniques is sent to students on completion of all Core Technical stage subjects: CT1, CT2, CT3, CT4, CT5, CT6, CT7, CT8 and CT9.<ref =name>Certificates for Students, The Actuarial Profession, Institute and Faculty of Actuaries, 2011-01-25</ref>
Certificate in Finance and Investment
The Certificate in Finance and Investment is sent to all students who complete or are exempted from CT1, CT2, CT4, CT7, CT8, CT9 and CA1.<ref =name>Certificates for Students, The Actuarial Profession, Institute and Faculty of Actuaries, 2011-01-25</ref>
Associate of the Institute and Faculty of Actuaries
On completion of all of the Core Technical and Core Applications exams, then students can become Associate members of the Institute and Faculty of Actuaries and gain the right to describe themselves as an actuary and to use the letters AIA or AFA provided that they have one year of work experience as an actuary.<ref =name>Associate membership, The Actuarial Profession, Institute and Faculty of Actuaries, 2011-01-25</ref>
Fellow of the Institute and Faculty of Actuaries
On completion of all of the Associate exams, two of the Specialist technical subjects and one of the Specialist applications subjects, students can become Fellows of the Institute and Faculty of Actuaries and to use the letters FIA or FFA provided that they have three years of work experience as an actuary.<ref =name>Fellow membership, The Actuarial Profession, Institute and Faculty of Actuaries, 2011-01-25</ref>
Alternative routes to Fellowship are:
- By vote of the membership
- By mutual recognition of qualifications
- Honorary Fellow
Chartered Enterprise Risk Actuary (CERA)
Associates and Fellows gain a further qualification, CERA, if they pass the ST9 Enterprise Risk Management exam.<ref =name>Obtaining CERA, The Actuarial Profession, Institute and Faculty of Actuaries, 2011-01-25</ref>
Two-tier charging structure
The Institute and Faculty of Actuaries operates a two-tier charging structure for its examination fees: full rate and reduced rate. The reduced rate is at a discount to the full rate.
To qualify for a reduced rate, the student member must have an income which is less than £7 050 per annum regardless of where you live or work
CT stage: £215 per subject. ST stage: £295 per subject. CA1: £575. SA stage: £295 per subject.
CT stage:£110 per subject. ST stage: £150 per subject. CA1: £290. SA stage: £150 per subject.
Compliance with Equality Act 2010
Complaints were submitted to the Equality and Human Rights Commission querying the two-tier charging structure's compliance with Equality Act 2010, which outlaws discrimination on the basis of nationality. However the Equality Commission have not taken action against the Actuarial Profession on this matter.
Public Policy Submissions
UK Government's Shortage Occupation List
Shortage Occupation List background and purpose
When occupations are placed on this list, UK employers have less restrictions for recruiting candidates directly from overseas; specifically from outside the EU. They would no longer need to complete a residency test, which involves demonstrating that a search for suitable candidates within the UK in the first instance has been unsuccessful.
Actuaries added to the shortage occupation list
Removal from shortage occupation list
Actuaries were removed from the shortage occupation list in April 2013 following a consultation by the UK Government's Migration Advisory Committee in January 2013. On this occasion, the Actuarial Profession made no submission either way; neither for nor against a shortage of Actuaries.
Statistics on shortage occupation list migrants
Despite the Actuarial Profession advising a shortage of Actuaries, freedom of information requests to the UK Border Agency (now superseded by UK Visas and Immigration) have revealed that only 19 people emigrated to the UK to work as an Actuary via the shortage occupation list from 1 November 2011 to 12 March 2013.
The salaries of these migrants ranged from £42,500 (Actuary) to £186,261 (Chief Actuary). The average salary was £82,042.
Despite Solvency II Directive work being cited as a reason for a shortage of Actuaries, only one migrant had the description "Solvency II" in their job title.