Aside from the essential job that actuaries perform, there is good reason why they make a lucrative salary. It is because becoming a recognized actuary involves a lot of work, which demonstrates proficiency and experience. “Actuaries are professionals because they must meet rigorous standards for admittance to professional societies,” states California Polytechnic State University’s Statistics Department. “ Before you can be called an actuary in the United States, you must become an Associate or Fellow of the Society of Actuaries (SOA) or the Casualty Actuarial Society (CAS).”
The process to becoming a member of the SOA and CAS can begin while you are still completing your undergraduate degree and continue while you complete internships or your first actuarial job.
There are various actuarial specialties and employers. The professional organization you choose to gain designations from will depend on what kind of actuarial profession you wish to pursue.
Difference between the SOA and CAS
Simply put, those interested in an actuarial career within the property/casualty field will seek certification from the Casualty Actuarial Society (CAS); and those preferring to work as a life/health actuary will seek designation from the Society of Actuaries (SOA).
The Future Actuary newsletter’s article called “Your choice” explains this further: “Dale Porfilio, FCAS, pricing director at Kemper Insurance Companies, advises candidates to consider what issues they enjoy exploring and spending time on. ‘Are you interested in becoming an expert about how people own, use and insure their autos and homes? Or are you interested in life and health, the well being of people and how you can invest their money?’”
In the same Future Actuary article, Jim Blair, then Prudential Insurance Company of America’s head of actuarial recruiting, recommended that prospective actuaries complete internships in both life/health and property/casualty areas to find out which might be more reflective of their interests and talents.
Types of Designations/Credentials
The SOA and CAS administer three different categories of membership designations.
- Associate: This is the first level of designation and requires completing a series of examinations, additional courses administered by the SOA or CAS, and meeting the VEE (Validation by Educational Experience) requirement.
- CERA: The CERA (Chartered Enterprise Risk Analyst ) credential serves to recognize actuaries who specialize in enterprise risk management. With the CAS, those seeking the CERA credential must also meet all its Associate requirements. With the SOA, those seeking their CERA credential can do so as “an alternative pathway to the ASA [Associate] designation.” (Naturally exams and courses are required for the CERA designation).
- Fellow: Gaining recognition as a Fellow demonstrates a deeper actuarial knowledge and practice and is also an attractive designation to employers hiring for more advanced and higher-paying positions. To gain Fellow membership with the SOA, candidates must be already an Associate (or meet all the Associate requirements) and then complete additional courses and exams within a specialty track; through the CAS, prospective Fellows must write additional exams in addition to meeting all of the Associate requirements.
Exams
To become an Associate member (‘ASA designation’ as the SOA calls it), you must pass a series of exams (five or six) administered by the SOA or CAS. BeAnActuary.org highly urges candidates to start completing exams while they are pursuing their undergraduate degree, as, generally, those recruiting for entry-level actuarial positions like to see that potential employees have passed a minimum of two of the preliminary exams. Although the exams can be taken in any order, it is generally advisable to write the Probability (Exam P or 1/P) and Financial Matters (Exam FM or 2/FM) first.
After graduating with your degree, while working in an entry-level position (as an actuarial assistant or analyst, for example), you can continue studying for and writing exams. “Most insurance companies and consulting firms that employ actuaries have established programs that pay the exam fees for their employees and provide some time during the workday to study for exams,” states BeAnActuary.org. “In addition, raises are often tied to exam progress.”
VEE Requirement
One component of gaining your Associate membership through the SOA and CAS is meeting the VEE (Validation by Educational Experience) requirement. You must meet the VEE requirement for Economics, Corporate Finance and Applied Statistical Methods. Basically, it involves you filling out paperwork (and accompanying it with proper documentation) and paying a fee, to show how some courses you have completed, standardized exams you have passed or other professional designations you have earned, meet these educational experience categories. After a period, candidates are notified on whether their past experiences have indeed met the VEE Requirements.
Courses/Learning Modules
When you look at the SOA and CAS membership requirement pages for each designation, you will see that prospective members must also complete some online and in-person courses/learning modules. For example, towards Associate membership, the SOA requires successful completion of an actuarial practice and a professionalism course; the CAS requires successful completion of two online courses (delving into risk management, insurance operations and other topics), as well as a professionalism course.
