Apprenticeship training course

Actuary (level 7)

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Information about Actuary (level 7)

Analysing data to predict the likelihood and potential financial risk of future events

• Knowledge, skills and behaviours:
  View knowledge, skills and behaviours

  Knowledge

  • Principles of time preference theory of interest and the time value of money, including standard actuarial compound interest rate functions.
  • Principles of equation of value to evaluate financial problems in particular relating to loan schedules, bond prices, bond yields, and project appraisals.
  • How to model uncertain future cashflows which may be contingent on mortality, morbidity, or survival.
  • The future loss random variable and its application to the calculation of premiums and reserves for conventional life assurance and annuity contracts.
  • Rational economic theory, including utility theory.
  • The use of models in portfolio selection and asset pricing, including the term structure of interest rates and credit risk.
  • The use of models in insurance to calculate the probability of ruin and estimate claims.
  • The construction and evaluation of common forward and option contracts, as well as theoretical models for derivatives and option pricing, in particular the theory and application of binomial and Black-Scholes models.
  • Basic properties and uses of commonly used probability distributions, and the statistical properties of data generated by randomly sampling from a known distribution.
  • The use of statistics to make inferences about the process underlying a data set.
  • Regression theory and its applications, including generalised linear models.
  • The fundamental concepts of Bayesian statistics.
  • Statistical distributions suitable for modelling the variables and risks that arise in insurance contracts.
  • Time series analysis methods and stochastic processes, including Markov chains and Markov jump processes.
  • Description, estimation, and use of statistical survival models for the time until an event occurs.
  • Elementary principles of machine learning.
  • Corporate governance and regulation, including the different objectives and stakeholders that companies may seek to satisfy.
  • Different types of corporations, how they are structured and financed, and factors which should be considered when deciding on their structure.
  • The construction and interpretation of company accounts.
  • Economic concepts and models, their use in business, and recent economic and financial history.
  • Microeconomics, including models of consumer choice and the theory of the firm, and how these affect business decisions under different conditions.
  • Macroeconomics, including aggregate economic variables and concepts that relate them to government policy, business decision-making, and financial market variables.
  • The business environment in which they will work and the wider actuarial landscape.
  • Approaches to tackling business-related problems, including strategic thinking, business decision-making, and the evaluation of investment projects in a corporate setting.
  • The basic legal principles relevant to actuarial work and their practical implications.
  • Approaches to applying underlying actuarial principles to a range of problems and issues in commercial and business environments.
  • Approaches to identifying, classifying, measuring, and managing risk in a range of commercial situations, including the use of the Actuarial Control Cycle for risk management.
  • Approaches to the application of mathematical and statistical techniques to a range of problems and issues in commercial and business environments.
  • Approaches to the application of business finance and economics concepts to a range of problems and issues in commercial and business environments, including the valuation of liabilities.
  • Problem-solving in financial services, focusing on problems and issues in financial services, with application to wider domains and industries.
  • The principal terms used in financial services, investments, asset management, and risk management.
  • The various external forces on an organisation and their impact, including climate change and other environmental issues.
  • The role of professional and ethical standards in an actuary's work.
  • The role of peer review in professional work.

  Skills

  • Apply actuarial principles to real-world examples of interest rates, discounting, and evaluation of present values of cash flows.
  • Apply the principles of the equation of value to evaluate financial problems, particularly relating to loan schedules, bond prices, bond yields, and project appraisals.
  • Project cash flows to profit-test life insurance contracts, and apply projected cash flow techniques to pricing and reserving.
  • Apply a range of financial risk measurement tools to evaluate investment opportunities in the context of utility functions.
  • Apply actuarial modelling to real data sets using Excel.
  • Apply mathematical and statistical methods to real data sets using R programming.
  • Produce simple visualisations and statistics from a data set.
  • Interpret company accounts.
  • Apply the Actuarial Control Cycle for an organisation.
  • Apply the critical steps to check and model data, and analyse the actuarial methods used and the outputs generated.
  • Document actuarial work, and create and maintain an audit trail.
  • Communicate to stakeholders, such as colleagues, the approach, results, and conclusions of actuarial modelling.
  • Provide written communications of a technical nature to a non-technical audience, using effective structure, appropriate language, clear explanations, and incorporating effective communication tools.
  • Identify relevant information and appropriate content to ensure a communication meets its objectives.
  • Present the results of actuarial work to informed but non-technical audiences.
  • Analyse and prioritise stakeholder needs when designing actuarial solutions.
  • Apply the concepts of professionalism, awareness of the Actuaries’ Code, and business ethics to a range of different situations.

  Behaviours

  • Takes responsibility for personal and professional development, and meets the Associate-level Personal and Professional Development requirements of the Institute and Faculty of Actuaries.
  • Acts honestly and with integrity.
  • Carries out work competently and with care.
  • Remains impartial, ensures that professional judgement is not compromised, and cannot reasonably be seen to be compromised by bias, conflict of interest, or the undue influence of others.
  • Complies with all relevant legal, regulatory, and professional requirements.
  • Acts ethically, speaking up if they believe, or have reasonable cause to believe, that a course of action is unethical or unlawful.
  • Works collaboratively with others.
• Apprenticeship category (sector): Legal, finance and accounting
• Qualification level: 7; Equal to master’s degree
• Course duration: 39 months
• Funding: £18,000 ; Maximum government funding for ; apprenticeship training and assessment costs.
• Job titles include:
  • Actuary
  • Capital actuary
  • Financial actuary
  • Insurance actuary
  • Investment actuary
  • Pensions actuary
  • Pricing actuary
  • Reserving actuary
  • Risk actuary
  • Climate actuary
  • Climate change actuary
  • Environmental, social, and governance actuary
  • Sustainability actuary

View more information about Actuary (level 7) from the Institute for Apprenticeships and Technical Education.