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CAS Update
Opportunities for Casualty Actuaries
Steve D’Arcy
Midwestern Actuarial Forum
March 23, 2004
Overview

Three opportunities
 Expanding
risk horizons
 Teaching
 Volunteering

CAS Update
Growth of Financial Risk

Foreign exchange rates
 End

of Bretton Woods agreement in 1972
Equity prices
 Option

pricing model introduced in 1973
Commodity prices
 Inflation

of 1970s
Interest rates
 Federal
Reserve policy shift in 1979
The Building Blocks of Financial Risk
Management




Forwards
Futures
Swaps
Options
Financial Risk Disasters

Laker Airlines
 Foreign

Savings and Loan Associations
 Interest

exchange risk
rate risk
Orange County
 Leverage

Long Term Capital
 Model

and interest rate risk
specification error
Enron
 Mispricing
derivatives
The Anatomy of a Casualty Actuary

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Good at math
Like practical applications
Can explain complex issues to a non-technical
audience
Generally risk averse
Professional code of conduct
Why Should Casualty Actuaries Get
Involved in Other Risk Areas?
1.
2.
If organizations view risk on an integrated basis,
hazard risk (our current domain) is subsumed into the
overall risk management process
Others are not doing a very good job of dealing with
these risks
How to Get Started

ERM Seminar in Chicago
 April
26-27
 Co-sponsored by the CAS

CAS Online Courses on Financial Risk Management
 Introduction
to Financial Risk Management
 The Building Blocks of Financial Risk Management
 Securitization
 Interest Rate Models
Teaching

Actuaries make effective teachers
 Think
intuitively
 Focus on applications

Potential areas to teach
 Math
 Risk
management and insurance
 Finance
Academia as a Career Option

Early career shift
 Get
a Ph.D.
 Teaching and research

During your career
 Guest
lectures
 Part time teaching
Locally
 Internationally


Late career shift
 Teaching
 Advising
actuarial students
 Managing actuarial science programs
Reasons to Volunteer

Develop business skills
 Leadership
Meeting
 Practice management skills

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
Network with other actuaries
Have a voice in CAS decisions
Additional leadership opportunities
How to Volunteer

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Get involved in the MAF
Offer to give presentations at meetings
Complete the CAS Participation Survey
Respond to calls for volunteers
Express interest to committee chairs, vice presidents
or other CAS leaders
Current CAS Topics:
Any Questions on these or other Issues?

CAS Centennial Goal for 2014

International Developments

Educational Process and Recent Exam Changes

Two Important Task Forces

Research Working Parties

CAS Web Site
THANK YOU !!!!!