Making It to the Top

by | March 31, 2009

The vast majority of actuaries don't make it to the top ranks of the business world. Of course, most MBAs don't either. Let's say there are roughly 8,000 publicly traded and private companies in the United States worth mentioning -- the kind of companies that have an outside chance of being mentioned in The Wall Street Journal or Forbes. That means that less than three-tenths of 1 percent of the U.S. population is running a big-name public company. So don't feel bad if your actuarial career doesn't lead to the corner office.

That said, actuaries are becoming more involved in top decision-making efforts at major corporations. As you might expect, actuaries have the fastest rise to the top in insurance companies, and many C-level executives at life, health and property insurance companies were once computing life tables just like you. Actuaries are also finding careers in the financial divisions of major corporations. As risk awareness, management and mitigation become more of a priority for companies squeezing every cent of possible shareholder value, actuaries can play a leadership role as comptrollers and even chief financial officers.

Most actuaries that rise to the executive suites have gotten their MBAs alongside any advanced work they've done as actuaries. Indeed, the combination of business know-how and actuarial skills can be a compelling mix for the boardroom. If you're interested in reaching the top levels of a corporation, your actuarial work will help you -- but get that MBA, too. "I know that if I don't want to progress any further as an actuary, I need to get my MBA," says one pension actuary mulling a shift into management ranks after failing to pass his sixth actuarial exam. "There comes a point where you have to know more about the broader business world that you just don't have. Actuarial work can have a pretty narrow focus. I need to know more about the psychology of it, the leadership." Of course, even if you're successful in passing your exams, an MBA can advance your career in new directions as well, and is a strong asset in reaching the upper executive ranks.

Actuaries who reach the executive level are rarely directly involved in the assessment of risk factors -- they have people who do that for them. In the insurance and pension industries, they may be overseeing other actuaries and directing their overall work. In other industries, executive actuaries are generally better equipped to foresee risks that may not occur to their colleagues.

Most actuaries will still be involved in the financial areas of corporate leadership once they rise to the executive ranks, and their risk-assessment and mitigation can also provide operational insights.

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