Actuaries have long been the technical backbone of the insurance industry. However, actuarial work is changing. An expanding risk universe and new risk models mean they are playing a more active role in all aspects of the re/insurance value chain, and getting involved in crucial issues such as climate change.
What's more, technologies such as big data analytics and artificial intelligence are changing the way the profession performs its tasks.
UK-based consultancy Hymans Robertson has been recognised by our judges for doing the most to keep on top of those trends. In 2019, it worked with 47 re/insurer and financial service clients, notably in the area of longevity, where its business has expanded significantly over the past six years to the point where it employs a 40-strong team of life consultants.
The firm has also helped clients to understand the implications of environmental, social and governance risks, as well as helping insurers consider new areas of market growth.
Among its notable appointments was the independent expert reporting to the court on the successful £20bn ($26bn) transfer of Zurich's workplace and pensions business to Scottish Widows, which was completed in last July.
During 2019, the consultancy has published several research and thought leadership papers, including its Protecting Generation Rent research paper that discussed the implications for the protection industry of the shift from home ownership to renting; and the Matching Adjustment benchmarking survey that studied how UK life insurers are applying the Solvency II measure.
Hymans Robertson also published a mortality benchmarking survey and the second edition of the Longevity Risk book in 2019.
Emma McWilliam, head of life and financial Service at Hymans Robertson, says the firm expects that 2020 will see climate change and responsible investment continue to move up insurers' agenda.
She says: "We've laid the foundations, for example with our inaugural 2019 climate change survey, to support our clients as they face both the asset and liability-side challenges presented by climate change.
"We will continue to develop our tools and analytics that we offer to clients, including our Strategic Asset Allocation tool, which leverages Hymans Robertson's in-house economic scenario generator."
Asked about trends in the actuarial sector in the coming years, McWilliam says: "The bulk annuity and pension scheme de-risking markets show no signs of slowing down, so we expect the safely management and transfer of that risk over the longer term will continue to occupy many actuaries over 2020 and beyond."
She adds that product innovation will continue to be a focus in the savings, retirement and protection space.
"We expect a wide range of innovations this year – for example, decumulation solutions, protecting "generation rent" and longevity hedging solutions, perhaps even a longevity index," says McWilliam.
