Become an Actuarial Accountant – Careers and Outlook

What is an Actuary Accountant?

An actuary accountant is a statistician who uses accounting principles, financial theories, applied statistics, and mathematics formulas to generate the probability of a specific risk or event within a specific time frame for specific data sets. Actuaries analyze economics and other factors such as social data and use the statistics they glean to recommend solid financial decisions and perform risk assessment for an insurance company, private or public corporation, or government entity to minimize any negative financial impact.

Besides having excellent math skills including understanding statistics and statistical data, those in actuarial work should have a strong background in business, accounting, and computer science to prepare for an actuarial career.

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Actuaries typically work in an office environment as part of a team that may include accounting managers, underwriters, market research analysts, and financial analysts. Consulting actuaries who work for consulting firms may have more flexible schedules that include traveling to client locations throughout the United States to lower their financial risks. In 2016 around one-third of actuaries reported working over 40 hours a week so there's a good chance overtime will be part of the job.

Depending on the industry, such as if they work for a health insurance or other insurance company, an actuary may be responsible for a wide range of duties.

Here are some examples of the position might entail:

Because the field uses specialized modeling and statistics software, actuaries are required to be adept with computers and may study and earn a minor or double major in computer science. In addition, because actuaries must be able to present their findings to their employer or clients they should be able to speak to both large and small groups. Training in both areas should be included in an actuary's formal education courses in order for them to be effective in their profession.

What are the Education Requirements to Becoming an Actuary Accountant?

To become an actuary, you'll need to earn at least an undergraduate accounting degree from an accredited school. Actuary science, statistics, mathematics, and similar analytic fields are typical but not required. You'll also need to pass a series of difficult exams to become certified, so you should plan your education with this in mind. You'll need courses in economics, corporate finance, and applied statistics as well as a strong knowledge base in computer science.

Here are the core courses you should plan on taking:

In the computer science sector, you should focus on programming languages as well as learning how to use and develop databases, spreadsheets, and statistical analysis programs. Because part of your job will be to present your findings to management and clients you should develop clear public speaking tools as well as report writing and the ability to simplify and present charts, graphs, and other data you develop.

What is the Job and Salary Outlook?

The job outlook for actuaries is excellent with a projected growth of 22 percent between now and the year 2026. That being said, it is a specialized field, so the actual job openings are projected to be approximately 5,300.

The following states project the highest need for future actuaries:

Actuaries will be needed in the growing area of enterprise risk management as companies begin to analyze and manage their own financial risks in various areas of business operations in response to new economic requirements and regulations.

Health insurance companies will be hiring actuaries in response to changing healthcare guidelines and regulations and to address new products and markets as the baby boomer generation retires.

Other insurance industries will also be hiring actuaries to analyze consumer information in the property and medical data fields. As available data increases insurance companies can use it to predict consumer trends, keep their prices competitive, develop new products, and project future costs and risks.

According to the Bureau of Labor Statistics (BLS) in May 2020 the median annual wage for actuaries was $111,030. The highest 10 percent in the field earned $196,010 and the lowest 10 percent earned $66,030. The large discrepancy between the lowest and highest paid is most likely due to the difference in education as well as experience as well as the metropolitan area where the actuary is employed. A full 25 percent of actuaries hold master's degrees and an additional 10 percent hold a Doctorate or professional degree while 62 percent hold the minimum required bachelor's degree. Learn more about accounting related salaries here.

Because the number of applicants sitting for actuary exams has increased job opportunities will remain competitive. Those who hold a master's degree or higher and have passed a minimum of two actuary exams will be the most sought-after employees, and those with experience will be posed to earn a much higher salary than those just beginning in the field. Although passing the CPA exam is not a requirement for actuaries many do hold the credential as it is the most respected and recognized in the field of actuarial accounting. Students should plan to work an actuary internship and excel in business and analytical skills in order to have the best entry-level positions.