American Academy of Actuaries (AAA) & Their Role In Reducing Risk
Navigating the financial risks of any business can be tricky. It requires a great deal of education and problem-solving skills to identify, and evaluate potential risks and develop a plan to mitigate them. An actuary does exactly that, but their work doesn’t stop in the financial industry.
In this article, we’ll cover what an actuary does and the role of the American Academy of Actuaries.
Table of Contents
- Actuaries are experts at identifying and mitigating risks in the financial sector.
- The AAA helps raise awareness about the profession, provides resources for actuaries, and assists public policymakers in evaluating risks.
- The AAA helps inform policymakers of potential risks in fields like life insurance, financial security, and casualty.
What Do Actuaries Do?
To know what the American Academy of Actuaries (AAA) does, you first have to know what an actuary does. An actuary is someone who’s professionally trained and educated on associating a price with risk. They are insurance and financial risk experts, who are knowledgeable and qualified.
Most actuaries go through years of education to receive degrees in business, economics, or even actuarial science. Then they go on to pass multiple exams from organizations dedicated to the profession such as the Society of Actuaries (SOA).
It’s not a quick process either. The process of passing the exams can take another several years to complete. After becoming an actuary, the professionals will need to complete 30 continuing education hours annually in order to stay compliant with the U.S. Qualification Standards.
Actuaries are considered to be experts at:
- Determining the likelihood of future events based on data
- Mitigating the effects of unwanted events
- Finding creative ways to manage risk
- Helping companies analyze the long-term financial impact of their decisions
- Estimating the cost associated with unwelcomed events
Typically you’ll find actuaries within the finance industry. They’re also common in the fields of insurance, medicare, and social security.
American Academy of Actuaries
The AAA is an organization that aims to create advancement in the actuarial profession. They enforce high professional standards for its members including conduct, qualifications, and practice. The AAA also works with public policymakers to provide guidance and evaluate risk in financial security matters.
The academy has been around since 1965 and currently holds headquarters in Washington D.C. They have an admirable mission of serving the public and creating sustainable financial security systems for the United States.
One of their goals is to bring more awareness to the profession and raise its value through communications with business leaders, policymakers, and the general public.
Their members get a wealth of benefits for being part of the academy.
- Professional resources (qualification standards, practice notes, and standards)
- Continuing education programs
- Networking opportunities
- Newsletters and actuary updates
The academy’s work in public policy is supported by a council and several committees that discuss topics and issues regarding:
- Life insurance
- Major Property or casualty issues
- Risk management and financial reporting
Actuaries are a profession that has the ability to inform decision-makers and leaders about the potential for risk and how to avoid them. They’re highly skilled and the American Academy of Actuaries holds the profession to standards of conduct and professionalism that propels the profession forward.
FAQs about the American Academy of Actuaries
You can apply to be a member of the AAA by filling out their online membership form on their website: https://actuary.org.
The AAA has a search function that allows you to find qualified actuaries that meet your specifications.
These are available on the AAA website as well.
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