Challenges to the Casualty Actuarial Profession 2018

In previous years I’ve posted about some of the challenges facing the property and casualty actuarial profession. In 2018 we are facing a new, unique set of challenges, and I invite your thoughts on a few relevant topics:

Big Data

Recently, actuaries have been inundated with the availability of big data. We now have the ability to run analysis with much larger bodies of data at much higher speeds. This allows us to glean greater insight into things like noise versus trends or whether instances of correlation denote causation. What has been your experience with big data?  Is the quality of our data getting better or is there just more of it?

 

Auto Insurance

In the auto insurance world, new methods and technologies are being adopted by the industry. For example, V2X (Vehicle-to-Everything), V2V (Vehicle to Vehicle), and V2I (Vehicle to Infrastructure) are the latest being tested by various auto manufacturers and technology companies.  The technology allows for autonomous vehicles to preemptively communicate issues to each other and to improve traffic flow and safety at intersections. How do we, as actuaries, shift our old pricing knowledge from liability and physical damage to autonomous comprehensive? How do we assess liability from connected cars that will be targeted by cyber threats? How do we react to connected vehicles infecting other computers related to infrastructure safety?

 All those designations

There has been a litany of designations that have been developed in response to these changes. CERA, CSPA, AIS, ARM, CIC, AIDA and so on.  We finally obtain the ACAS or FCAS and then we have a vast array of additional designations to choose from, depending on our area of actuarial work. What are your thoughts on these designations?

Please share comments and reactions to these challenges below.

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About Terry J. Alfuth

Terry J. Alfuth, FCAS, is a member of the CAS Risk Management Committee. He owns his own consulting firm, Actuarial Property & Casualty Consulting LLC located in Palm Beach, FL.

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