Institute and Faculty of Actuaries

Institute and Faculty of Actuaries

The Institute and Faculty of Actuaries is the professional body which represents and regulates actuaries in the United Kingdom[1].

History

The Institute and Faculty of Actuaries came into being on 1 August 2010 as a result of the merger of the Institute of Actuaries and the Faculty of Actuaries in Scotland after voting members of both bodies voted to merge their respective organisations in a ballot held on 25 May 2010.[2]

Structure and governance

The Queen in Council granted an amendment effective 1 August 2010 to the Charter of the Institute of Actuaries in terms that converted it to the Charter for the Institute and Faculty of Actuaries. The assets, liabilities and membership rights of the Faculty of Actuaries in Scotland were transferred on this same day to the Institute and Faculty of Actuaries and the Charter of the Faculty of Actuaries in Scotland was surrendered. Essential elements of the merger arrangements, such as the Scottish constituency and its representation on the Council of the Institute and Faculty of Actuaries, are incorporated into the new governance documents.

Authority for the governance, control and strategic direction of the Institute and Faculty of Actuaries sits with the Council which will in turn delegate to various boards, committees and staff.[3]

President

The President of the Institute and Faculty of Actuaries (IFoA) is Marjorie Ngwenya. Her term began on 28 June 2017. She succeeded Colin Wilson, who now takes up the title of Immediate Past President. The President-elect is Jules Constantinou.

Research and member support

Actuaries work in a number of different practice areas: enterprise risk management, finance and investment, general insurance, health and care, life insurance and pensions.

Each of these areas is supported by an executive committee which oversees the development of knowledge and research within its own area, provides members with CPD opportunities and takes forward a programme of practice-specific research. The committees also foster a sense of community among actuaries practising in their particular field of expertise.[4]

Education and regulation

The Institute and Faculty of Actuaries sets examinations, continuing professional development, professional codes and disciplinary standards. The Financial Reporting Council (FRC) assumed responsibility for oversight of the actuarial profession and the independent setting of actuarial technical standards with effect from May 2006.[5]

Fully qualified actuaries are Fellows and may bear the designations FIA or FFA while Associates bear the designations AIA or AFA.

Practising certificates are issued to certain actuaries for their statutory role in the financial management of life offices and most pension schemes. The Institute and Faculty of Actuaries continues the former Institute’s role as a designated professional body, under the Financial Services and Markets Act 2000, which enables it to license firms that are managed or controlled by actuaries, allowing them to carry on certain limited regulated activities.

An actuarial qualification from the Institute and Faculty of Actuaries consists of a combination of the completion of various examinations and courses. The examinations are split into four sections: core technical, core applications, specialist technical, and specialist applications. In addition to examinations and courses, it is required that the candidate both complete at least three years work as an actuary and to qualify as a Fellow.[6]

Examinations

An actuarial qualification from the Institute and Faculty of Actuaries consists of a combination of the completion of various examinations and courses. The examinations are split into four sections: Core Technical (CT), Core Applications (CA), Specialist Technical (ST), and Specialist Applications (SA). Study material for the examinations is usually obtained through the official bookshop of the Institute of Actuaries [7] or through the Actuarial Education Company (ActEd),[8] a subsidiary of BPP Actuarial Education Ltd.

In addition to examinations and courses, it is required that the candidate complete at least three years work as an actuary to qualify as a “Fellow of the Institute and Faculty of Actuaries” (FIA) [9]

Core Examinations

The Core Technical section consists of 8 written exams and a “Business Awareness Module,” CT9. These are usually sat first by a candidate and include the underlying mathematics involved in actuarial work as well as an introduction to financial and economic issues. These are also the most common exams for which candidates may get exemptions.

The Core Applications section consists of a 6-hour written exam and two practical exams which focus on the application of concepts learned and a candidate's ability to communicate actuarial concepts to others.

Specialist Examinations

The Specialist Technical section is the first stage the candidate has a choice of which exams to take. The candidate chooses two from the various actuarial specialist subjects i.e. Health and Care, Life Insurance, General Insurance, Pensions, Finance or Investments and further technical knowledge on said subjects is attained.

Since the 2010 examinations, the General Insurance Specialist Technical paper ST3 was replaced by two subjects ST7 and ST8.[10]

The Specialist Applications section allows the candidate to choose one area for which they take the SA paper and attain full Fellowship; leading to many referring to this as the “Fellowship paper.” However, as the rules on the ordering of examinations were relaxed, this examination may be taken before taking some earlier examinations resulting in candidates qualifying on other papers.

List of Examinations

Core Technical Stage

Core Applications Stage

Specialist Technical Stage

Specialist Applications Stage

UK Practice Modules

For students working in the UK only

Qualifications

Certified Actuarial Analyst

This new qualification[11] will be obtained after passing 6 modules. Module 0 tests basic mathematics (with a its syllabus based on the Foundational ActEd Course written by ActEd (The Actuarial Education Company)[12]), Modules 1-4 tests parts of the CTs and Module 5 tests audit trails (CA2).[13]

Certificate in Financial Mathematics

The Certificate in Financial Mathematics is issued by the Institute and Faculty of Actuaries.

Diploma in Actuarial Techniques

The Diploma in Actuarial Techniques is sent to students on completion of all Core Technical stage subjects: CT1, CT2, CT3, CT4, CT5, CT6, CT7, CT8 and CT9.[14]

Certificate in Finance and Investment

The Certificate in Finance and Investment is sent to all students who complete or are exempted from CT1, CT2, CT4, CT7, CT8, CT9 and CA1.[14]

Associate of the Institute and Faculty of Actuaries

On completion of all of the Core Technical and Core Applications exams, then students can become Associate members of the Institute and Faculty of Actuaries and gain the right to describe themselves as an actuary and to use the letters AIA or AFA provided that they have one year of work experience as an actuary.[15]

Fellow of the Institute and Faculty of Actuaries

On completion of all of the Associate exams, two of the Specialist technical subjects and one of the Specialist applications subjects, students can become Fellows of the Institute and Faculty of Actuaries and to use the letters FIA or FFA provided that they have three years of work experience as an actuary.[16]

Alternative routes to Fellowship are:

Chartered Enterprise Risk Actuary (CERA)

Associates and Fellows gain a further qualification, CERA, if they pass the ST9 Enterprise Risk Management exam.[17]

Examination fees

Two-tier charging structure

The Institute and Faculty of Actuaries operates a two-tier charging structure for its examination fees: full rate and reduced rate. The reduced rate is at a discount to the full rate.

To qualify for a reduced rate, the student member must have an income which is less than £7 140 per annum regardless of where you live or work

Student members from a list of specific countries can purchase educational materials from Acted at a discount.[18]

Examination fees

Rates as at 2017[19] are as follows:

Full rate

CT stage: £220 per subject. ST stage: £305 per subject. CA1: £595. CA2: £450. CP3: £310. SA stage: £305 per subject.

Reduced rate

CT stage: £115 per subject. ST stage: £155 per subject. CA1: £300. CA2: £260. CP3: £160. SA stage: £155 per subject.

Compliance with Equality Act 2010

Complaints were submitted to the Equality and Human Rights Commission querying the two-tier charging structure's compliance with Equality Act 2010, which outlaws discrimination on the basis of nationality. However the Equality Commission have not taken action against the Actuarial Profession on this matter.

Public Policy Submissions

UK Government's Shortage Occupation List

Shortage Occupation List background and purpose

When occupations are placed on this list, UK employers have less restrictions for recruiting candidates directly from overseas; specifically from outside the EU. They would no longer need to complete a residency test, which involves demonstrating that a search for suitable candidates within the UK in the first instance has been unsuccessful.

Actuaries added to the shortage occupation list

In November 2011, Actuaries were added to the UK Government's shortage occupation list.[20] The Actuarial Profession had argued for Actuaries' inclusion on this list.

Removal from shortage occupation list

Actuaries were removed from the shortage occupation list in April 2013 following a consultation by the UK Government's Migration Advisory Committee in January 2013.[21] On this occasion, the Actuarial Profession made no submission either way; neither for nor against a shortage of Actuaries.

Statistics on shortage occupation list migrants

Despite the Actuarial Profession advising a shortage of Actuaries, freedom of information requests to the UK Border Agency (now superseded by UK Visas and Immigration) have revealed that only 19 people emigrated to the UK to work as an Actuary via the shortage occupation list from 1 November 2011 to 12 March 2013.

The countries of origin for these migrants were as follows: Australia (6), China (1), India (4), Malaysia (1), South Africa (5) and United States (2).

The salaries of these migrants ranged from £42,500 (Actuary) to £186,261 (Chief Actuary). The average salary was £82,042.

Despite Solvency II Directive work being cited as a reason for a shortage of Actuaries, only one migrant had the description "Solvency II" in their job title.

References

  1. ↑ 'The IFoA is a professional membership body incorporated by Royal Charter. Its object is, in the public interest, to advance all matters relevant to actuarial science and its application and to regulate and promote the actuarial profession.' https://frc.org.uk/Our-Work/Publications/Actuarial-Policy-Team/Actuarial-Standards-A-Statement-by-The-Financial-R.pdf
  2. ↑ Actuarial Profession press release.
  3. ↑ Actuarial Profession.
  4. ↑ Acuarial Profession.
  5. ↑ Actuarial Profession.
  6. ↑ Actuarial Profession.
  7. ↑ Bookshop,
  8. ↑ Acted The Actuarial Education Company
  9. ↑ How to Register as a Student a student, The Actuarial Profession, Faculty and Institute of Actuaries, 2011-01-25
  10. ↑ How to Register as a Student a student, The Actuarial Profession, Institute and Faculty of Actuaries, 2011-01-25
  11. ↑ "New qualification takes a step forward - Institute and Faculty of Actuaries". www.actuaries.org.uk.
  12. ↑ "Actuarial Education Company". www.acted.co.uk.
  13. ↑ "Certified Actuarial Analyst: executive summary of the qualification".
  14. 1 2 Certificates for Students, The Actuarial Profession, Institute and Faculty of Actuaries, 2011-01-25
  15. ↑ Associate membership, The Actuarial Profession, Institute and Faculty of Actuaries, 2011-01-25
  16. ↑ Fellow membership, The Actuarial Profession, Institute and Faculty of Actuaries, 2011-01-25
  17. ↑ Obtaining CERA, The Actuarial Profession, Institute and Faculty of Actuaries, 2011-01-25
  18. ↑ "Actuarial Education Company". www.acted.co.uk.
  19. ↑ "Exam fees and fees for other education services - Institute and Faculty of Actuaries". www.actuaries.org.uk.
  20. ↑ Announcements
  21. ↑ "Migration Advisory Committee report: full review of the recommended shortage occupation lists for the UK and Scotland". Archived from the original on 2013-10-02.
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