CAS Update Opportunities for Casualty Actuaries

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CAS Update Opportunities for Casualty Actuaries

• Steve DArcy
• Midwestern Actuarial Forum
• March 23, 2004

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Overview

• Three opportunities
• Expanding risk horizons
• Teaching
• Volunteering
• CAS Update

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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

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The Building Blocks of Financial Risk Management

• Forwards
• Futures
• Swaps
• Options

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Financial Risk Disasters

• Laker Airlines
• Foreign exchange risk
• Savings and Loan Associations
• Interest rate risk
• Orange County
• Leverage and interest rate risk
• Long Term Capital
• Model specification error
• Enron
• Mispricing derivatives

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The Anatomy of a Casualty Actuary

• Good at math
• Like practical applications
• Can explain complex issues to a non-technical
  audience
• Generally risk averse
• Professional code of conduct

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Why Should Casualty Actuaries Get Involved in
Other Risk Areas?

• 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

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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

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Teaching

• Actuaries make effective teachers
• Think intuitively
• Focus on applications
• Potential areas to teach
• Math
• Risk management and insurance
• Finance

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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

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Reasons to Volunteer

• Develop business skills
• Leadership Meeting
• Practice management skills
• Network with other actuaries
• Have a voice in CAS decisions
• Additional leadership opportunities

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How to Volunteer

• 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

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Current CAS TopicsAny 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

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THANK YOU !!!!!