Editing Actuary (section)

==Responsibilities==
<!-- BLS 2022(all tabs) and GAD 2015 for UK blurb: start -->Actuaries use skills primarily in mathematics—particularly [[calculus]]-based [[probability]] and [[mathematical statistics]]—but also economics, computer science, finance, and business. For this reason, actuaries are essential to several sectors:

* to the insurance and reinsurance industries, either as staff employees or as consultants; 
* to other businesses, including sponsors of pension plans; 
* and to government agencies such as the [[Government Actuary's Department]] in the United Kingdom or the [[Social Security Administration]] in the United States. 

Actuaries assemble and analyze data to estimate the probability and likely cost of an event such as death, sickness, injury, disability, or property loss. Actuaries also answer financial questions: these questions include the level of pension contributions needed to produce a certain retirement income, and how a company should invest resources to maximize the return on investment in light of potential risk. Using broad knowledge, actuaries help to design and price insurance policies, pension plans, and other financial strategies so as to ensure that the plans are maintained on a sound financial basis.{{sfn|Bureau of Labor Statistics|2022}}{{sfn|Government Actuary's Department|2015}}<!-- BLS 2022(all tabs) and GAD 2015 for UK blurb: end -->

===Disciplines===
Most traditional actuarial disciplines fall into two main categories: life and non-life.

Life actuaries, who include health and [[pension]] actuaries, primarily deal with three kinds of risk: [[Mortality rate|mortality]], [[morbidity rate|morbidity]], and investment. Products prominent in their work include [[life insurance]], [[Life annuity|annuities]], pensions, short and long term [[disability insurance]], health insurance, [[Medical savings account|health savings accounts]], and [[long-term care]] insurance.{{sfn|Bureau of Labor Statistics|2022}} In addition to actuarial risks, social insurance programs are influenced by public opinion, politics, budget constraints, changing [[demographics]], and other factors such as [[medical technology]], [[inflation]], and [[Cost-of-living index|cost of living]] considerations.{{sfn|GAO|2000}}

<!-- Sourced to AIA: start-->Non-life actuaries, also known as "property and casualty" (mainly US) or "general insurance" (mainly UK) actuaries, deal with both physical and legal risks that affect people or their property. Products prominent in their work include [[auto insurance]], [[home insurance|homeowners insurance]], commercial property insurance, [[workers' compensation]], [[malpractice]] insurance, [[Product liability|product liability insurance]], [[marine insurance]], [[terrorism insurance]], and other types of [[liability insurance]].{{sfn|AIA|2014}}<!-- Sourced to AIA: end-->

Actuaries are also consulted for their expertise in [[enterprise risk management]].{{sfn|Bureau of Labor Statistics|2022}} This work may involve [[dynamic financial analysis]], [[Stress test (financial)|stress testing]], the formulation of corporate risk policy, and the establishment and operation of corporate risk departments.{{sfn|Institute and Faculty of Actuaries|2011b}} Actuaries are also involved in other areas of economics and finance, such as analyzing [[securities offering]]s or [[market research]].{{sfn|Bureau of Labor Statistics|2022}}

===Traditional employment===
For both life and casualty actuaries, their classic role is calculating premiums and [[Insurance#Indemnification|reserves]] for insurance policies that cover various risks.{{sfn|Institute and Faculty of Actuaries|2014|pp=12–14}} On the casualty side, analysis often involves quantifying the probability of a loss event (called the frequency) and the size of that loss event (called the severity). The amount of time occurring before the loss event is important, because the insurer will only need to pay after the event has occurred. On the life side, analysis often involves quantifying the worth of a potential sum of money or a financial liability at different times in the future. Since neither of these analysis types is a purely deterministic process, [[stochastic models]] are often used to determine frequency and severity [[frequency distribution|distributions]], as well as the [[parameter]]s of these distributions. Forecasting interest yields and currency movements also plays a role in determining future costs, especially for life actuaries.{{sfn|Tolley|Hickman|Lew|2012}}

Actuaries do not always attempt to predict aggregate future events. Often their work relates to determining the cost of financial liabilities that have already occurred, called [[Retrocession (Insurance)|retrospective reinsurance]],{{sfn|Gillam|1991}} or the development or re-pricing of new products.{{sfn|Heeney|Probert|2002}}

Actuaries also design and maintain products and systems. They participate in financial reporting of companies' assets and liabilities. Actuaries must communicate complex concepts to clients who may not share their language or depth of knowledge. They work under a code of ethics that covers their communications and work products.{{sfn|ASB|2022}}

===Non-traditional employment===
As an outgrowth of more traditional roles, actuaries also work in the fields of risk management and [[enterprise risk management]] for both financial and non-financial corporations.{{sfn|D'Arcy|2005}} Actuaries in traditional roles study and use tools and data previously in the domain of finance.{{sfn|Feldblum|2001|p=8}} Two accords—the [[Basel II]] accord for financial institutions (2004), and the analogous [[Solvency II]] accord for insurance companies (in force since 2016)—require institutions to account for [[operational risk]] separately, in addition to [[credit risk|credit]], [[Actuarial reserves|reserve]], [[asset]], and [[insolvency]] risk. Actuarial skills are well suited to this context, because actuaries are trained in analyzing various forms of risk, and judging the potential for gain and loss associated with these forms of risk.{{sfn|D'Arcy|2005}}

<!-- First two are from Mungan, last two are from Stefan -->Actuaries also participate in [[investment]] advising and [[asset management]], and can be general business managers and [[chief financial officer]]s.{{sfn|Mungan|2002}}{{sfn|Stefan|2010}} They analyze business prospects using financial skills in valuing or discounting risky future cash flows; they also apply pricing expertise in insurance to other lines of business. For example, insurance [[securitization]] requires both actuarial and finance skills.{{sfn|Krutov|2006}} Actuaries also act as [[expert witness]]es in court trials, by using analysis to estimate the economic value of losses such as lost profits or lost wages.{{sfn|Wagner|2006}}