Going international—Part 2
by Glenda Greenberg

At one time or another, you may have wondered what it takes to carry your actuarial skills abroad. To learn more, The Future Actuary talked to a candidate and an FSA about uncovering international opportunities. In the second part of a two-part series, Ronald Poon-Affat, 38, discusses his experiences. Ronald is vice president and managing director of Gen Re International Life and Health for Latin America. He is also the Caribbean and country manager for Gen Re Brazil.

How did you get your start in the actuarial field?
I was born in Trinidad, and being an actuary is an extremely high-profile position there. Mervyn de Souza was a very well known finance minister in Trinidad. He was the first Caribbean actuary, and had a great influence upon the establishment of financial systems in a post-colonial era. Trinidad is a small country, but thanks to Mr. de Souza’s example, I would guess that we have produced approximately 120 qualified actuaries—most of them don’t live there, though.

I went to university in England and studied actuarial science at the City University, London. Thereafter, I worked in London in the consulting field, both with Tillinghast and KPMG Management Consultants. I qualified as a Fellow of the Institute of Actuaries when I was 25. At that time, U.K.-appointed actuaries needed to be Fellows who were at least 31. Being rather impatient with this six-year wait, I took the opportunity to return to Trinidad under the terms of a government university scholarship, which I was awarded as a result of my pre-university entry exams. The deal is that you either pay back the funding or return to the island for three years and pay taxes.

Because there aren’t many actuaries in Trinidad, I was given the opportunity to accept a very challenging position. I became the appointed actuary of one of the largest insurance companies in the English-speaking Caribbean. This life company also owned an actuarial consultancy that I had to manage. Whilst everyone would think that life’s a beach when you are assigned to the Caribbean, I must admit to never working so hard in all my life during my three-year stint in Trinidad.

After fulfilling my scholarship obligations in Trinidad, a recruiter called me to discuss the position of chief actuary for a Puerto Rican insurance company. At the time I spoke only English and my knowledge of U.S. reporting was very basic. I saw the opportunity to learn a second language and improve my U.S. GAAP skills. With this appointment I was the only qualified actuary on the island of Puerto Rico.

Puerto Rico became my introduction to U.S. accounting/legislation, health insurance and the Latin American culture and language. I was having a hugely enjoyable time until a recruiter called me regarding a very intriguing offer that was impossible to refuse. Gen Re was looking to establish its life and health practice in Brazil. Without ever traveling to Brazil and without any knowledge of Portuguese, in 1997 I packed my bags and went to live in Sao Paulo. It was a unique opportunity to represent a AAA reinsurer in one of the world’s mega-cities (20 million inhabitants) looking after one of the largest economies within the emerging markets (160 million persons). In mid-2000, I was invited to manage both the Brazilian and Argentine life and health units, which together serviced Mercosur and Chile. Then, in early 2003, our Mexico City office was included within my area of responsibilities.

In my present role as regional managing director, I don’t have to do much actuarial work anymore. The work is more risk management-oriented. I still need to talk to our clients’ actuaries and help them solve problems using reinsurance. However, my main responsibilities consist of developing business strategies, monitoring results, aligning ourselves with key clients who share similar goals, making sure the company is headed in the right direction and growing our portfolio profitably and in accordance with our corporate risk profile.

Do you miss doing actual actuarial work?
I still undertake a lot of presentations at actuarial associations both in Latin America and at the SOA. I also publish papers and am a visiting lecturer at the University of Sao Paulo, Brazil at the MBA level, so it’s not like I’ve completely forgotten about actuarial science. It’s just that on a day-to-day basis, I’m not crunching numbers or looking at modeling software and things like that.

What skills/background should you have to prepare for an international career?
Both the Institute and the Society produce extremely well-qualified and technical professionals, but I’ve seen a lot of highly regarded actuaries come out to Latin America that can’t make a decision due to the lack of statistical data. You have to be able to work on the fly. You have to have a feel for the people on the team. You may be used to asking for lots of detail, however now there might not be any detailed analysis. You have to make timely decisions. A lot of people freeze. With all of the detailed information available to actuaries in the United States and Europe, actuaries are not trained to make decisions in another environment. I always say that you need to be able to see order in a sea of chaos.

Be as broad as possible. Study accounting, economics, finance—IT is very important since it’s likely that you will have to sit with systems personnel to obtain technical data to assist in your work. You’re not going to be labeled as an actuary, so don’t get hung up on the technical stuff. Enjoy your freedom to get involved in other projects.

You’re going to get the job because you’re an actuary, but you are not going to be involved solely in actuarial projects. You have to understand how the company distributes and administers the products, how they underwrite the risk and how they project the financials. You will be thrown into issues like compliance and asset management.

What’s the best way to learn more about a country’s business customs?
I get lots of e-mails from people asking how I did it. To be honest, I was presented with opportunities and I did not hesitate to take advantage of them.

A more structured approach would be to learn the language of the country that you are interested in. Work in a company or a consultancy that has an overseas office, and make it known when you get a job at the company that you’re interested. Get to know your foreign-based colleagues, find out what’s going on and show an interest. I think if someone out of the blue turned up in Latin America, knocked on the door and said, “I want a job,” the answer would be no.

In general, what is the perception of actuaries in the countries you’ve worked in? Does the perception differ from country to country?
The real difference between actuaries from different countries is the time of training. In the majority of Latin countries, there are no universities that offer actuarial programs. The few countries that do (Argentina, Brazil and Mexico) offer only undergraduate programs, and the professional associations do not have additional examinations. However, I have had the pleasure of meeting and working with some exceptional local actuaries.

What are the benefits of working internationally?
I think it’s a much broader experience, so you see a lot more things in the company. You get to travel a lot, if that’s what you like. There’s a lot of independence because you only see your boss a couple of times a year. You have to earn respect as a foreign-trained actuary. A mistake that many colleagues make is that they assume that they will be respected.

I love the independence and I’m happy to live with the consequences. You will have the opportunity to have an impact upon your organization. And this means that both the good and bad are quickly identified and you are either quickly promoted or invited to leave. There is not much room for mediocrity. The few long-standing FSAs and FIAs who are still in Latin America (and I can count them on one hand) are definitely way above average.

What are the challenges?
It depends on the flavor of the month. Right now Asia is the flavor of the month. Latin American experience doesn’t count for a lot right now. Latin America is in crisis. You can quickly go from being on a pedestal, like when Argentina was on top, to having no one interested in you.

You really have to get buy-in from your head office all the time. You have to sell confidence by communicating regularly. Your head office will have a set way of doing things. For example, the head office of your company may say, “We made money in America this way; this is what we’re going to do in Brazil.” That’s not going to happen. You’re not going to be successful that way. You have to be able to convince them that there is another way, and you have to have the vision to choose the way and win their support. You have to be able to re-write your head office’s underwriting guidelines (their rule book) and demonstrate that while the game is different in your market, there is logic, there are rules, and by following these rules it will be profitable. You need the confidence to challenge the status quo and not be a ‘yes’ man.

What would you say has been one of your most unique experiences?
One of the key consultancy projects that I was offered during my time in Trinidad was to assume the management of an insolvent insurance company. Our firm was able to turn the company around, encourage a buyer to invest in the company to protect the remaining assets of the policyholders. That was a great feeling—to try to save the policyholders’ funds and restructure their benefits and things like that. People were going to lose their life savings.

What factors are key to success?
Internationally, you have to be very creative and decisive. You have to be proactive because the people in the head office aren’t thinking about Latin America every day. That’s a distinct advantage—you can make very high-level decisions.

I would also tell you not to expect your career to develop in the way it did at the head office. You have to come up with your career strategy, and you have to sell it to your boss. It’s not going to come to you. By being based in a far-flung subsidiary, you are out of the loop and far from the walls and corridors of influence, so you have to be proactive. You need to be skilled at recognizing opportunities, seeing the silver linings in the dark clouds and believing in yourself. It’s simple, isn’t it?

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Rituals on that dreaded day!
by Pooja Dang

Ask any actuarial student about the day he or she dreads most in a year and the day of the actuarial exam has got to be among the top three! (Results day probably is up there too!)

For this article, I surveyed a large group of students in various stages of the exam process to provide you with a list of some of the quirky, crazy things people do on exam day.

Most people responded with one or two ‘rituals’ that they carry out. Here are a few of the responses that I received.

“I used to wear my Superman shirt to all of my exams!”

“I meditate for 30 minutes on the morning of the exam.”

“I used the same eraser for all of my exams. When I sat for my final Fellowship exam, I only had a few scraps left. I knew I had to pass because I wouldn’t have any left after the exam!”

“I stop studying at 3 p.m. the night before. I need that time to rejuvenate and energize before the exam.”

“I have to arrive to the exam center an hour and a half before the exam.”

“I eat chocolate chip cookies in the morning and wear my favorite boxers (you probably didn’t need to know this).”

“I always study at home in my pajamas and slippers…so I wear them to the exam too!”

“I usually wear my bright yellow sports jacket with Actuarial Science printed on the back. It’s my college class jacket.”

“I tend to wear apparel with some mention of my favorite baseball team, though this is really not that different than any other day. Ha!”

The most elaborate response I got was from a fellow student at CIGNA.

He said that many of the same techniques marathon runners use work for actuarial exams.

The power breakfast:

1 bowl of Total raisin bran with sugar
1 Powerbar
1-1?2 cups of coffee with 2 heaping spoons of sugar (or uncarbonated Red Bull)
1 Flintstones vitamin
1 tablet of ginseng
1 B-12 vitamin (6333% daily allowance)
1 B-6 vitamin
1 vitamin E
1 cup of orange juice

“Many marathon runners put Vaseline on certain parts of their skin that are subject to abrasion, but I haven’t found this to have a profound effect on my exam performance.

I don’t go to bed too early the night before because I end up spending too much time lying in bed thinking about the exam. It’s more important to get a good night’s sleep over the whole week before the exam than the night before. I set my watch alarm as a backup in case my power goes out.”

The list above is by no means exhaustive. For the candidates out there that have no rituals, some of the above may sound silly to you. The fact of the matter is that there are people out there that have certain rituals that they perform—it’s a matter of faith for them. All it takes to have a good exam day (aside from studying extremely hard!) is to be in the right frame of mind. If meditating or wearing your Superman shirt gets you there, I ask ‘Why not?’

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Multiple choice exams: Why do they take so long to grade?
by Chris Hurst, FCAS

Ever wonder why it takes as long to grade and publish results for the multiple-choice actuarial exams as it does for the upper-level exams, which also include essay questions? A current candidate posed this very question to the Casualty Actuarial Society (CAS) Candidate Liaison Committee. The following is a description of the timeline that is followed between the date of the exam sitting and the date exam results are released for Courses/Exams 1, 2 and 4 that are jointly sponsored by the CAS, the Society of Actuaries (SOA) and the Canadian Institute of Actuaries (CIA). A similar timeline is used for Exam 3, which is jointly sponsored by the SOA and the CIA. Brett Rogers, registrar and senior analyst with the SOA, provided this information.

American College Testing (ACT) handles the scanning and statistical analyses for the exams. ACT performs similar services for other organizations as well, which necessitates following their standard timeline to a certain degree. In addition, the examination committees are comprised of volunteers who also have full-time jobs. Ample time to review the data for the exam they work on has to be given to these committee members.

It takes ACT about one and a half weeks to receive, organize and inventory all of the answer sheets for a particular exam from the various test centers around the world. After this is done, a preliminary statistical analysis of the exam results is distributed to the Examination Committee so the answer key can be verified. The committee reviews the statistical analysis and provides ACT with a signoff or corrections to the answer key—this usually takes about one week. Candidates have two weeks after the exam is given to submit questions regarding potentially defective questions. When the committee is reviewing the preliminary statistical analysis, they also review the reports of defective questions to determine if any questions are truly defective. When ACT receives the signoff on the answer key and instructions regarding how any defective questions should be handled, it takes them approximately two additional weeks to complete the final statistical analysis reports. During this time period ACT is not only running the statistical reports but is also performing several quality checks on their work. For example, they always hand score a random sample of the test population to make sure that the scanners read the data correctly. When ACT is done producing the final statistical reports, they distribute the reports to the examination committees. At this point, approximately four and a half weeks from the exam date have elapsed.

While ACT is doing its work, the Examination Committee has a meeting in which a panel of experts convenes to review the exam. Every expert is asked to review each question in the exam and assess the difficulty of that question. More specifically, they are asked to estimate the likelihood that a minimally qualified candidate would answer the question correctly. The sum of these probabilities, averaged across the panel of experts, gives a preliminary estimate of the pass mark. Performance on the exams is considered in finalizing the pass mark, especially the effect of any particularly difficult questions.

Next, the final pass mark is determined in an Examination Committee conference call. The pass mark call will usually take place sometime during the sixth week after the exam is given, depending on the availability of the committee members. When the Examination Committee decides the final pass mark, it then has to be approved by the top education and examination officers of the CAS, CIA and SOA before grades can be processed. This typically takes just a day or two if there aren’t any problems.

The final pass marks for CAS/CIA/SOA Exams 1, 2 and 4 are sent to the SOA about five days before grades are due to be released. It takes a day just to print all of the grade slips for these exams and the performance breakdowns for those candidates not passing Courses/Exams 1 and 2. Files are then produced containing the passing candidate numbers that are to be placed on the CAS and SOA Web sites, and then the interactive voice response hotline is readied for use. It takes about three days to check the grade slips, passing candidate number files and the hotline for errors. Before the grades are released, great lengths are taken to avoid any possibility of reporting errors. Last but not least, it takes a full day to get the slips in the mail, and this is when passing candidate numbers are released on the Web sites and the hotline is opened.

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Keep it professional: A brief guide to electronic business communication etiquette
by Glenda Greenberg

E-mail and voice mail are two areas that most businesspeople are exposed to on a daily basis, which means that their importance can be taken for granted. Much like wielding a firm handshake or exercising good manners, practicing proper business etiquette will help give you the respect you deserve as a business professional.

E-mail
For many of us, e-mail is our main form of communication at the office. And although typing notes back and forth can be as casual as having a conversation, it has become easy to be a little too casual when sending a business message. It is a form of professional communication and should be treated with the same care as that of a written letter.

If you are communicating with a potential employer, write a professional letter with heading, closing and good grammar. Print a draft of your message and read it over several times. And, of course, use the software’s spell-checking feature.

When forwarding an e-mail message, clean it up as much as possible. We’ve all seen e-mails that have been forwarded from here to Timbuktu with many levels of quoting (>>>>). This makes it difficult to decipher the message buried amongst the symbols. Delete any extraneous information in e-mail forwards. If there is a chain of correspondence, try to use your e-mail to direct the recipient to the important highlights of the message. Let the recipient know why you are forwarding the message and perhaps even summarize the correspondence, if appropriate.

Having good e-mail etiquette also means remembering that dashing off a quick note is not always the most efficient form of communication. Know when to use e-mail and when a phone call may be more appropriate. For example, e-mail may be a good way to schedule a meeting or to communicate a meeting agenda, but it is not always the best choice for preliminary conversations. If you think that questions or confusion may arise from a message you’re thinking about sending, pick up the phone and clarify the issues. Then you can follow up the phone call with an e-mail documenting the discussion.

On that note, always include your complete contact information in the message. If someone does have a question about something you sent, he or she won’t have to dig through files to find your phone number.

Perhaps most important, do not include anything in an e-mail that you would not want others to see. Always be careful of what you say—especially in informal messages to coworkers. Once you hit “send,” the message is out of your control and could end up anywhere.

Some bonus e-mail pointers:

• Don’t type in all caps—it looks like you’re yelling
• Include a relevant subject line— with the volume of messages people receive, this will help ensure that your message will get the attention it deserves
• Don’t use emoticons [for example: :-)]—they’re not professional. Save them for your personal communications

Voice Mail
When leaving a voice mail, you usually have less than a minute to get your message across, so be clear, concise and professional. Before making the call, organize your thoughts. It may even help to take a few notes before the call so you don’t forget anything in the message. In fact, this is a good idea before any phone call—whether or not you reach someone’s voice mail.

Leave your name and number at the beginning and the end of the message—especially if your message is long. If you are calling someone you don’t know, spell your name out for that person, don’t force the recipient to listen to your message a second time.

On the opposite end, make sure your “greeting” message is appropriate, professional and up to date. Check your messages regularly and return calls promptly. Even if you don’t have an immediate answer to a request, call the other party back to let him or her know that you received the message and when you expect to have an answer.

Some bonus voice mail pointers:

The Greeting

• Pause for a second or two before recording your message
• Keep your greeting as short as possible
• Ask callers to leave specific information (full name, phone number and any other necessary info)

The Message

• Let the recipient know what time you called
• Let the recipient know the best time to reach you (and include your time zone)
• Let the recipient know when you need a specific response

We use voice mail and e-mail because they are fast, convenient
communication tools. And using them properly makes our lives easier. Good electronic communication etiquette will also help seal your reputation as
a true professional!

Janet Katz, FCAS, contributed to this article.

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Build your career around the changing actuarial marketplace
by Michelle Weidner, SOA project specialist

Actuaries are best known for the key role they’ve played in developing and maintaining a viable insurance industry; however, shifts in the marketplace are dramatically changing the world in which actuaries operate. In traditional markets, (insurance, reinsurance and consulting), and the broader financial services markets, (banking and investing), dynamic forces like demographic shifts, technological advances, regulatory changes and market globalization have left employers facing increasingly complex risks that require innovative strategies and solutions. Employers are now looking for leaders who can help them address these challenges.

The Society of Actuaries views these marketplace changes as an opportunity for actuaries to move beyond their image as quantitative experts and step forward as the leading professionals in the modeling and management of risk. The SOA recently conducted two years of extensive member and employer survey research. The goal was to understand how actuaries are viewed in the marketplace and how the profession can best position itself for leadership roles—more specifically, expanded roles in risk management.

Who’s the competition?
Who do employers currently look to for risk management expertise? The employer survey indicates that while traditional employers still rely on actuaries in areas where industry regulations mandate actuarial involvement, they have often looked to competing professionals, such as MBAs and CFAs, to lead the risk management function. Employers in the broader financial services industries are even more likely to look to competing professionals, even for lower-level risk management positions, in part because many of them have limited familiarity with what actuaries have to offer. The great news is that this is starting to change as employers discover all that actuaries have to offer.

How are actuaries viewed?
In order to compete for the emerging opportunities in risk management, it is critical that actuaries understand how they are viewed in the marketplace. In the employer survey, respondents were asked to rank actuaries on various skills and characteristics and then rate competing professionals on the same measures. Across the board, actuaries outscored the competition in quantitative modeling, solving complex problems, risk management skills, financial assessment/reporting and reliably getting the right solution. Competing professionals scored higher in business communication skills, business acumen, taking informed risk, focusing on the big picture, being proactive, being team players, leading and advising.

The traditional markets, which are more familiar with the abilities of actuaries, ranked actuaries higher in intellectual agility and industry knowledge. The broader financial services markets, which are less familiar with actuaries, ranked competing professionals higher on these same characteristics. These findings indicate that, compared to the competition, actuaries are viewed as having fundamental skills that are important, but are not viewed as favorably with respect to business and leadership skills.

Are these employers’ opinions based on perception or reality? While that question can be debated, when it comes to employment opportunities, perception is reality. If employers perceive that most actuaries lack certain key skills, it will be harder for all actuaries seeking to step into expanded leadership roles in risk management. Thus, the profession as a whole must take steps to ensure that actuaries are developing the skills needed to meet employers’ changing needs.

The professional landscape
There are clear steps you can take to broaden your career opportunities. Develop business acumen. It will help you identify the right issues to address on your job. Your technical skill will help you find the right solution. And with good communication skills, you can explain complex problems and solutions to colleagues without a technical background who nevertheless make crucial decisions at your company.

Seek out opportunities to make presentations and explain technical issues to others in simple terms, and learn from others who do this well. Expand your horizons by interacting with nonactuarial colleagues, including those in marketing, underwriting, investment, administration and law. If you’d like to be a leader, start thinking like a leader. Find out as much as you can about the industry in which you are employed. Aim to look beyond the numbers and truly understand the big picture in terms of the current and future issues faced by that industry. Stay current by reading industry publications and networking with those who have a variety of interests, perspectives and skills.

For most of you, over 40 years of your career lie ahead. Getting off to the right start is important, since the skills you acquire early on can shape the rest of your life—so use these years to acquire the right skills for future success.

Secure your future
Today’s vital marketplace requires companies to manage risk more closely than ever before. Across markets, employers are looking for those who are willing and able to step up to the plate. As you prepare for your actuarial career, you have it within your power to become the well-rounded risk professional that employers are looking for!

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From The Future Actuary, Vol. 13, No. 1, Spring 2004
Copyright 2004 Society of Actuaries
and Casualty Actuarial Society