About [...]]]>

I had a busy day yesterday, so you’ve already probably seen this elsewhere.  Yesterday, the Wall Street Journal published a list of the best and worst jobs. (Story here; list here)   The list was developed by careercast.com and is based on that site’s assessment of each profession’s environment, income, employment outlook, physical demands, and stress.

About actuaries, the WSJ writes:

Actuaries, who evaluate the financial impact of risk on an organization, fared best because they work during standard business hours and in favorable conditions—indoors and in places free of toxic fumes or loud noise—as opposed to those jobs toward the bottom of the list such as iron worker, dairy farmer and the biggest loser from last year’s study, lumberjack. They also aren’t expected to do any heavy lifting, crawling or crouching—attributes associated with occupations like bricklayer, auto mechanic and roofer, also near the bottom of the list. (The physical demands of a job were measured using formulas devised by the Department of Labor, with higher scores given to jobs involving great exertion.)

Here’s the top 10, bottom 10, and a couple of selected others from the list:

Rank	Profession	Starting Salary	Median Salary	Top Level Salary
1	Actuary	$49,000	$85,000	$161,000
2	Software Engineer	$54,000	$85,000	$129,000
3	Computer Systems Analyst	$45,000	$76,000	$118,000
4	Biologist	$39,000	$71,000	$148,000
5	Historian	$34,000	$62,000	$111,000
6	Mathematician	$54,000	$95,000	$141,000
7	Paralegal Assistant	$29,000	$46,000	$73,000
8	Statistician	$40,000	$73,000	$117,000
9	Accountant	$37,000	$59,000	$102,000
10	Dental Hygienist	$44,000	$67,000	$91,000
39	Insurance Underwriter	$35,000	$57,000	$100,000
103	Insurance Agent	$26,000	$45,000	$114,000
191	Mail Carrier	$37,000	$50,000	$52,000
192	Meter Reader	$20,000	$33,000	$54,000
193	Construction Worker	$18,000	$29,000	$54,000
194	Taxi Driver	$16,000	$22,000	$34,000
195	Garbage Collector	$18,000	$31,000	$51,000
196	Welder	$23,000	$34,000	$51,000
197	Dairy Farmer	$21,000	$32,000	$45,000
198	Ironworker	$22,000	$32,000	$49,000
199	Lumberjack	$22,000	$32,000	$47,000
200	Roustabout	$21,000	$31,000	$49,000

The story caught my attention for a few reasons:

1.  It’s actually, in a way, old news.  I’m aware of some small-town high schools in Alabama which have been using online/distance learning technologies for years, to help bring more challenging coursework to [...]]]>

A tweet from @meepbopeep brought my attention to this report from NBC Nightly News:

The story caught my attention for a few reasons:

1.  It’s actually, in a way, old news.  I’m aware of some small-town high schools in Alabama which have been using online/distance learning technologies for years, to help bring more challenging coursework to schools which lack the student pool and/or finances to support them.

2.  I’ve actually been a fan of distance learning since I first became acquainted with the concept, about 20 years ago when I was introduced to the internet.  Considering all the times growing up where I was frustrated with the slow pace of classes…well, the notion of distance learning has a certain appeal to me.

3.  More recently, within the American actuarial profession, there has been a bit of fuss raised over “Future Education Methods”, most recently framed as a way that certain rigorous university programs could be used in lieu of passing actuarial exams on the path towards earning actuarial credentials.

While I’m still opposed to that particular idea, I have for years thought that online/distance learning would be a wonderful reform to the actuarial exam process.  I’ve questioned whether self-study exams are really the best way to educate actuaries.  I’ve speculated that online classes could be a way to more effectively educate prospective actuaries, while maintaining the rigor of the system.

I probably was a bit before my time in thinking such thoughts (and admittedly they could be a bit of disgruntlement on my part, since self-study for an all-or-nothing exam isn’t really my forte).  I’ve quietly welcomed the introduction of modules, first on the life side, and soon on the casualty side, as being sorta/kinda close to the education system I’d love to see the American profession adopt.  But I still wonder if more could be done in this regard.

Talk a few colleges into giving credit for an SOA/CAS-sponsored online class, perhaps even collaborating in providing material and manpower, and you’ve got a better FEM proposal right there. 

Meanwhile, fields like risk management may be gaining traction on Wall Street today in the wake of the financial crisis. Ms. Hewitt says employers have also been posting more positions in risk [...]]]>

The Careers section of the Wall Street Journal on Tuesday ran an article entitled, “The Next Finance Hiring Spots”.   It includes the following observation:

Meanwhile, fields like risk management may be gaining traction on Wall Street today in the wake of the financial crisis. Ms. Hewitt says employers have also been posting more positions in risk management this year than before. And more than 23,000 of finance professionals have registered to take the financial risk management certification exam this year, a 70% increase compared to 2008, according to the Global Association of Risk Professionals, the organization that administers the exam.

Between that passage and the general thesis of the article — that people entering the finance arena should seek to be well-rounded, analytic businesspeople  — I was left thinking, “it sounds like the world needs more finance-flavored actuaries”.

Yet nowhere in the article is the word “actuary” mentioned.

I’m just feeling the love.

The American Academy of Actuaries announced that its members elected four new regular directors today at its annual meeting in Boston. The new regular directors will serve on the organization’s board of directors.

Mary D. Miller, a property/casualty actuary with the Financial Regulation Division of the Ohio Department [...]]]>

Seen in an American Academy of Actuaries press release:

The American Academy of Actuaries announced that its members elected four new regular directors today at its annual meeting in Boston. The new regular directors will serve on the organization’s board of directors.

Mary D. Miller, a property/casualty actuary with the Financial Regulation Division of the Ohio Department of Insurance, David Neve, the vice president of corporate valuation for Aviva USA in Des Moines, Iowa, and Tom Wildsmith, a consulting actuary with the Hay Group in
Arlington, Va., were elected to three-year terms.

Ron Gebhardtsbauer, who is the faculty-in-charge of the Actuarial Science Program at the Pennsylvania State University, was elected to serve a one-year term that was vacated by Art Panighetti on Oct. 20 when he was elected by the American Academy of Actuaries board of directors as the new vice president of its Life Practice Council.

So, what about the proxy battle?

Attendees reported at the Actuarial Outpost that the question of whether it was appropriate for the Board to unilaterally reduce the number of member-elected board seats by one position was ruled out-of-order.  Tom Bakos’s name was placed into nomination.  The Academy received approximately 1000 proxies, while supporters of Tom received approximately 300 proxies.  Tom received votes from approximately half those in attendance, but that was insufficient to overcome the Board’s proxy collection.

The outcome isn’t surprising, but it did provide a venue for supporters of a petition drive to make their case for amending Academy Bylaws for contested, direct election of all members and officers.

I’ve shared my thoughts on that petition drive previously.  In a nutshell, I think it is a good idea, and I would encourage Academy members to review the proposal and sign the petition.

The American Academy of Actuaries has posted a FAQ on its website to flesh out its view on the odd proxy battle emerging for next week’s AAA meeting in Boston.  A sampling:

Why is the Academy collecting proxies?

The Academy recently became informed through news articles and online [...]]]>

(h/t Mary Pat Campbell for the pointer to the FAQ)

The American Academy of Actuaries has posted a FAQ on its website to flesh out its view on the odd proxy battle emerging for next week’s AAA meeting in Boston.  A sampling:

Why is the Academy collecting proxies?

The Academy recently became informed through news articles and online message boards that a few members planned to collect proxies to oppose the Academy’s Nominating Committee’s nominees for regular director positions. We cannot speak for these members. However, the Academy’s Nominating Committee engaged in an extensive process to present to the members a slate that consists of four highly respected actuaries in their areas of practice. The nominees are exceptionally well qualified to help lead the Academy into 2010 and beyond. The Academy is collecting proxies from members, who wish to support the Academy’s Nominating Committee’s slate of candidates, but will not be in attendance on Oct. 26.[…]

Why doesn’t the Academy have an election?

Since its inception, the Academy has always held elections of regular directors at the Annual Meeting. This is the time and place for election of regular directors that is established in and required by the Academy bylaws. Members who cannot attend the annual meeting in person have the ability to assign their proxy

The existence of a Nominating Committee is to ensure that practice areas are evenly represented on the Academy’s board of directors and to ensure that board members have experience and familiarity with the Academy’s processes and practice councils.

An alternative point of view can be found at the Actuarial Outpost.  The short version of that alternative view is

• Some Academy members, even though they may have no objections to the slate of candidates nominated by the AAA, have a concern about how the AAA Board elections and operating procedures may not mesh well with current principles of good governance and transparency.
   
• Two particular examples of these concerns include:
   
  • The Academy Board, last May, amended the AAA’s bylaws to separate the office of Secretary-Treasurer into two offices, increasing the board-selected membership by one, and decreasing by one the the number of Board members elected by the membership.   The change was not widely announced, and the amendment to the bylaws was only published on the AAA website after the proxy drive began.  The change would result in members directly electing less than one-third of Board members.  As certain significant acts that could be taken by the Board require a two-thirds majority, this could be seen as a critical reduction in member input into Board activities.
     
  • Traditionally, Academy board elections are conducted by an acclamation of support among annual meeting attendees.  Prior to this year’s meeting, there has been no attempt to solicit confirmation by members not attending the meeting, and there has been no mechanism for contested elections.  Compare this to current SOA and CAS procedures, where members with voting rights are sent ballots to vote for Board members and Society officers, and where a procedure (other than via proxy fight) exists for elections to be contested.
     
• Some Academy members believe the split of the Secretary-Treasurer office, and the elimination of an elected Director’s seat constitutes an amendment to the Academy bylaws which would require a member vote.  Under this reasoning, the Academy’s recommended slate of candidates for Board membership would leave a vacancy.
   
• Tom Bakos is running for that vacant position.  He and others are collecting proxies in support of his candidacy. 
   
• In addition, Tom and others are circulating a petition to amend the bylaws to permit direct election of Board members and Academy officers by members, akin to what is already done in the SOA and CAS, except for the protection of representation from the four major fields of actuarial practice in the U.S.

Personally, I am sad, if oddly entertained, by the weird proxy battle underway.  I’m not a lawyer, so I can’t really say whether the bylaws amendment was appropriate or not, but I do find the the change and the way it wasn’t communicated troubling when the profession is under criticism internationally for needing better governance and improved transparency.  The way in which the Academy has responded to Tom’s candidacy (its silence on the  bylaws change in particular) provides fodder for conspiracy theories.

The actuarial profession in America is still small enough that there is an air of most actuaries knowing (or knowing of) most other actuaries.  That familiarity makes it very likely that anyone rising to a leadership position will have the respect of a sizeable portion of Academy membership, and that they will generally act in what they believe is the profession’s best interests.  Mistakes may be made, and there may be differences in opinion…but that would be true under the current governance structure as well as under a direct-election model.

However, I also believe philosophically that increased transparency and members’ having the ability to act as a check on leaders’ power is usually a good thing.  I wouldn’t want any actuarial organization to be bogged down by excessive surveys and member votes, but direct election of officers and Board members doesn’t seem to be too much to ask.

Given that we ask the American Academy of Actuaries to act as the public face of the actuarial profession in the United States for purposes of political, regulatory, and media relations, and given the challenges the profession has recently faced and will continue to face, including:

• Potential fallout from the Morris Report
• Social Security, Medicare, and pension funding and benefits
• Business and political ramifications of coastal catastrophic exposure
• Insurer solvency and bailouts
• Health care reform
• Possible federal regulation and the potential loss of antitrust
• The coming shift from GAAP to international accounting standards
• Differing opinions as to the expansion of the actuarial profession into other areas of practice

…it seems worthwhile to ensure that members have the potential for more direct influence over Academy leadership.  These are all very significant issues to American Actuaries, and it is important to ensure that we are appropriately represented to politicians, regulators, and the media.

Some of us in the actuarial profession make a living identifying worst-case scenarios, and assessing our employers/customers’ preparedness for those situations, unlikely though they may be.  With any organization, there is the chance that leadership could abuse its power and/or become nonresponsive to members’ needs and concerns.  So, even though it seems almost unthinkable that the Academy board could be untrustworthy, having a reasonable mechanism for competitive elections and for members to easily vote seems like a prudent precaution to take.

For that reason, I think the Academy bylaws changes proposed are an excellent idea, and I would encourage Academy members to support the petition.  Furthermore, I think it would be appropriate to have a member who is leading the bylaws amendment push fill a vacant seat on the Academy board. 

Although I would prefer that the change in board composition had been more widely discussed with the membership and put up for general vote (I assume that vote would pass), I don’t see that matter being resolvable from the floor of the meeting.  I think that a struggle or legal action over the appropriateness of how the bylaws were revised would not be particularly constructive, and I would worry about how a proxy-battle/contested board election might unfairly taint the effort to amend the bylaws to require direct elections. 

So, I would encourage members not attending next week’s meeting to not give their proxies to the Academy, and instead either withhold their proxies (in opposition to the idea of a proxy battle) or give their proxies to Mr. Bakos (to express support for transparency and responsiveness), as their conscience dictates.

(As always, the views expressed above are my own.  They should not be interpreted as an expression of the opinions of my employers past, present, or future.)

A group representing 36 European actuarial associations, Group Consultatif Actuariel Européen, called Wednesday for developing two actuarial standards as part of Solvency II.[…]

Solvency II calls for insurance and reinsurance operations to establish actuarial functions that are carried out by people qualified to analyze the risks inherent in those businesses.

The actuarial group said [...]]]>

Seen at Business Insurance:

A group representing 36 European actuarial associations, Group Consultatif Actuariel Européen, called Wednesday for developing two actuarial standards as part of Solvency II.[…]

Solvency II calls for insurance and reinsurance operations to establish actuarial functions that are carried out by people qualified to analyze the risks inherent in those businesses.

The actuarial group said public interest standards should include actuarial qualifications as well as ethical, governance and communications standards.

Technical standards should include those that require proper qualifications for interpreting regulatory requirements. Those standards also should lay out broad principles on different aspects of the actuarial function, with the aim of ensuring consistency among actuaries in the European Union, Group Consultatif said.

The full document is available from the GC website.  Skimming through it, I didn’t see anything too earth-shattering.  I had a sense of foreboding about additional potential bureaucracy, which I quickly stifled by remembering that I don’t work in Europe; and I did have a chuckle at the explicit breakout of the promulgation of actuarial standards and discipline from other insurance regulatory activity, with the GC and its member organizations retaining control of those breakouts of course.

American actuaries might have a bit of interest in skimming through the suggested high-level syllabus of required actuarial education.  There too, nothing too earth-shattering (although perhaps there’s a bit additional emphasis on the creation, care, and feeding of models than we see on this side of the pond), but it is a little interesting to me to see something so close to a succinct, consolidated summary of actuarial education for the profession’s major practice areas; as opposed to the pretty firm division between life and casualty actuarial education in North America.

A fuller explanation is available at Tom Bakos’ website.  A simplified explanation is that [...]]]>

According to this thread at the Actuarial Outpost, proxies are being sought from American Academy of Actuaries members in support of nominating from the floor an additional candidate for the Board of Directors at the AAA meeting in Boston later this month.

A fuller explanation is available at Tom Bakos’ website.  A simplified explanation is that there is some disagreement about whether the Academy’s decision to break the position of Secretary/Treasurer into two separate Officers positions is permitted under the Bylaws.  If it isn’t, four directors should be elected to the Academy board, rather than just the three on the recommended slate.

MAAA’s interested in the subject should check out Tom’s rationale and the related discussion on the AO.

The American Academy of Actuaries announced today that the Academy and Bruce D. Schobel have agreed to resolve the lawsuit filed on Sept. 1, 2009.

The Academy indicated that the resolution of the lawsuit [...]]]>

The American Academy of Actuaries has put out a press release, announcing the apparent end of the U.S. actuarial profession’s own courtroom drama:

The American Academy of Actuaries announced today that the Academy and Bruce D. Schobel have agreed to resolve the lawsuit filed on Sept. 1, 2009.

The Academy indicated that the resolution of the lawsuit had nothing to do with Mr. Schobel’s service as a member of the Academy’s board of directors or as its president-elect. To the contrary, the Academy thanks Mr. Schobel for his dedication and service as both a member of the Academy’s board and as its president-elect.

Mr. Schobel stated that it is in the best interests of the profession for the litigation to cease so that he and the Academy can get back to the important work that must go on.

(h/t to Mary Pat Campbell for bringing this to my attention)

I’m still refraining from comment.  But as is always the case, some lively discussion can be found on this and almost every topic under the sun at the Actuarial Outpost.