More actuaries needed - The Star

KUALA LUMPUR: More actuaries are urgently needed to ensure the successful implementation of the risk-based capital framework (RBC) and other regulatory policies in the insurance industry, Actuarial Society of Malaysia president Raymond Lai said.

He added that this was because there were a lot of processes, risks, stochastic modelling and other technicalities involved in the implementation of the RBC that only actuaries had the expertise to handle.


Scheduled to be implemented by 2009, the RBC would enhance insurers' risk-management practices and make them more accountable for the products they sell, he said.


It would also provide them the flexibility to launch innovative products and improve capital efficiency as well as boost public confidence.

"Many people do not know what an actuary's main role and responsibility in the insurance industry are. An actuary uses his technical skills to price insurance products and estimate the liabilities of the company.


"In general, he helps ensure that the financial condition of the insurer remains stable, strong and solvent," Lai said in an interview.


According to Lai, of the 51 actuaries currently registered with the society, 42 are working in Malaysia. In the next five years, it expects to register 100 more actuaries.


He said the number of actuaries in Malaysia was very small compared with other countries. For example, Hong Kong had more than 1,000 actuaries and Australia about 3,000.


With more insurers including takaful players coming into the market, demand for these professionals was expected to further rise.


Takaful companies had recently been issued with appointed actuary guidelines, although general insurers had yet to receive one, but would in the near future head in the same direction, he added.


The main challenge facing the profession was the acute shortage of experienced and skilled actuaries as many were working abroad due to better remuneration and benefits, he noted.


Apart from the pull factor, other reasons are the lack of awareness and the arduous journey to obtain full qualification.


The shortage of such professionals would consequently lead to slower development and growth of the industry.


Lai said Singapore, Hong Kong, Taiwan, China and Australia were some of the countries in which Malaysian actuaries tended to work.

To boost the number of actuaries, the society was continuously promoting actuarial science, especially at education fairs and college talks, Lai said.