The evolving role of the Actuary - Towers Watson insights

A little more on developments in the Actuarial function under Solvency II, this time from Towers Watson.Worth looking out for more material from the "European Actuarial Director's Forum", but they provide the gist in this doc, most notably (on the future of the function);

• "Growing need for company boards to receive and understand risk information and data" seen as a likely workload increaser
• "Up-skilling" may be required for some actuaries to provide the opinions on underwriting and reinsurance policies (was surprised at this, but these are EU-wide findings)
• Requirements for separating "operating" and "controlling" functions to ensure independence, as well as (potential) whistle-blowing requirements still to be decided
• Concern that supervisors may provide stronger challenge on undertakings with combined Actuarial & Risk functions
• Pretty even spread of "biggest challenges" to the function - only 19% had "contribution to the risk management system" as their number 1
• Spectacularly aggressive comment from Axa's Chief Risk Officer - "Risk management is too important to leave to the risk management function"
• Small fear that restrictions on who can head the function may be relaxed due to the legislative ambiguity
• Around 60% looking to reorganise their Actuarial function
• Three quarters of respondents have Risk and Actuarial function positioning as a "significant issue", with various states of preparation
• Towers Watson drop in their idea of industrialising actuarial process and output in order to aid with all of these concerns (i.e freeing up actuarial resource for the new Solvency II remit, including the land grab in the risk function already discussed on this blog)
• Both Solvency II and IFRS cited in the summary as reasons why the function may not only be considered "purely technical specialists", but also develop into a "wider business advisory role in relation to risk management".