Why Actuarial Science? My Story and the Appeal of Becoming an Actuary
Actuarial Science is a broad field of study. Many might find it dull, others may not even know it exists, but some (including me!) are passionate about it. In this post, I will briefly explain what actuaries and actuarial analysts do, and how much they earn, and share my four reasons for choosing actuarial science. By the end, you should have a better idea of whether this field is right for you—or if you should steer clear of it entirely.
I began my actuarial exam journey this year. In 2022, I started working at Verisk, an insurance data analytics company and studied insurance-related subjects during my master’s degree program. Before that, actuarial science was a mystery to me. When I first heard the word aktuariusz (actuary in Polish), I likely misunderstood it, as many others in Poland might, confusing it with akcjonariusz (shareholder in Polish).
In Poland, there are only 445 licensed actuaries, according to the register of actuaries maintained by the Polish Financial Supervision Commission, as of October 28, 2024. This is largely the result of a rigorous examination process (which I’ll discuss in a future post). However, I also believe it stems from the fact that actuarial science is a less well-known profession in Poland. Additionally, the insurance industry here is not as developed as in countries like the United States, so the demand for actuaries is relatively lower.
That said, it remains a critical profession for insurance companies, banks, and other financial institutions. There is still demand for skilled actuaries, and combining actuarial knowledge with strong analytical thinking can open doors to other professions, such as actuarial analyst roles or even data science positions within the insurance industry.
I’ll share my four reasons for starting my actuarial exam journey and my growing interest in actuarial topics. But first, let’s explore what actuaries and actuarial analysts do—and how much they can earn.
What Exactly Do Actuaries and Actuarial Analysts Do?
Actuaries and actuarial analysts are professionals skilled in mathematics, statistics, and finance, using their expertise to evaluate and manage risks. To succeed in these roles, individuals typically have a background in mathematics, economics, statistics, or related fields. Strong analytical thinking, problem-solving skills, and proficiency in tools like Excel, R, Python, or actuarial-specific software are also key.
Broadly, actuaries are divided into two primary roles:
Reserving Actuaries (or Accounting Actuaries):
These actuaries focus on maintaining sufficient reserves—money set aside by insurance companies to pay future claims. They work closely with financial statements and regulatory filings, ensuring compliance with industry standards and legal requirements. Their work involves filling out detailed reports, conducting reserve adequacy testing, and aligning their results with accounting principles.Pricing Actuaries:
Pricing actuaries, on the other hand, use statistical models to assess and predict future risks. They determine the probability of events like accidents, illnesses, or natural disasters, and calculate the cost of covering those risks. This role often involves setting insurance premiums, designing new products, and analyzing trends to ensure a company's profitability and competitiveness.
While both roles rely on similar skills, their focus differs: reserving actuaries ensure financial stability, while pricing actuaries drive business strategy by managing risks and predicting future losses. Together, they form the backbone of risk management for insurance companies and financial institutions.
Given the critical nature of their work, actuarial roles are highly valued and come with competitive salaries. In the next section, I’ll explore just how lucrative a career in actuarial science can be.
Is Actuarial Science a Lucrative Career?
Actuarial science can indeed be a lucrative career, offering high earning potential, particularly as professionals gain experience and certifications. Here's an overview based on data from the U.S. and Poland:
United States
Median Salary: Actuaries in the U.S. earn a median salary of approximately $108,610 annually, with the top 25% making over $130,000 per year. Entry-level actuarial analysts typically start around $70,000 to $80,000, depending on location and company size.
High-Paying Roles: Senior actuaries and actuaries in specialized fields like reinsurance or risk management can earn significantly more, with salaries often exceeding $200,000 annually.
(based on data presented by money.usnews.com and glassdoor.com)
Poland
Entry-Level: Actuarial analysts and junior actuaries in Poland can start with salaries of about 8,000 to 15,000 PLN gross per month.
Senior Positions: Experienced actuaries or chief actuaries can command salaries of up to 38,000 PLN monthly, especially in larger insurance companies or multinational corporations.
Industry Comparison: Actuarial science stands out as one of the higher-paying professions within the financial sector in Poland, albeit with fewer positions available compared to countries like the U.S. due to the smaller insurance market size.
(based on data presented by Gazeta Ubezpieczeniowa and Kariera w Finansach)
Why Is It Lucrative?
Demand for Expertise: Actuaries are essential in industries like insurance, finance, and consulting, where risk quantification and management are critical.
Certification Advantage: As professionals pass rigorous exams and obtain certifications, their earning potential increases significantly.
Global Opportunities: With the actuarial skill set being globally recognized, opportunities for high-paying roles abroad are plentiful.
Now, if the combination of intellectually stimulating tasks and great earning potential hasn’t already piqued your interest, let me add a personal touch! Up next, I’ll share my four reasons for choosing actuarial science. Who knows, maybe you’ll discover some inspiration (or at least justification for pursuing all those exams)!
Four Reasons I Chose Actuarial Science
I Work in the Insurance Industry
I’ve placed this reason first because it’s likely the biggest factor in why I began pursuing actuarial exams and found actuarial science intriguing. Working as a data analyst in the insurance industry requires me to deepen my understanding of insurance concepts, including those rooted in actuarial science. This knowledge helps me interpret data more effectively and provide impactful insights.
Another motivating factor is the support offered by my company—and many other insurance-related firms—for exam preparation, which makes the process much more accessible. However, if you don’t plan to work in the finance industry, actuarial science might not be as relevant or useful to you.
I Had Actuarial Subjects in College
During my studies, I took several actuarial courses and found them interesting. Learning how to calculate insurance premiums, model risks, and identify factors influencing potential losses were just a few of the highlights. These experiences sparked my interest and left me wanting to explore the field further.
I Am a Math Enthusiast
I wasn’t the top math student in high school or college, but I always enjoyed solving mathematical problems—especially those in calculus, and statistics. At the university, I found subjects like mathematical statistics and financial mathematics particularly engaging. These courses built a solid foundation for me, and now, studying for actuarial exams often feels like a recap of what I’ve learned before (although, let’s be honest, there’s still a lot of new material to master!).
If you’re the type of person who enjoys solving integrals in your free time or calculating the probability of random events, then actuarial science might be for you.
I Like Learning New Things
Even with a strong academic background in economics, data analytics, and statistics, I still have much to learn about the actuarial profession. Fortunately, I enjoy learning new things, which makes the process of becoming an actuary quite enjoyable.
This commitment to continuous learning is essential—not just in actuarial science but in many other fields, especially in a rapidly changing world with evolving software tools and AI. If you’re naturally curious and eager to keep expanding your knowledge, actuarial science could be a perfect fit for you.
Image 1. If you enjoy solving calculus and statistical problems like I do, I highly recommend picking up some college textbooks—many of which are easily available second-hand, for example, on eBay. Here are pages from two of my favorites: Thomas’ Calculus: Early Transcendentals by Weir and Hass, and Mathematical Statistics with Applications by Wackerly, Mendenhall, and Scheaffer.
Conclusion
Actuaries play a vital role in quantifying risk, setting insurance premiums, and ensuring financial stability for businesses. Professionals working in the actuarial industry can earn competitive salaries due to the high demand for their skills, certifications, and numerous global job opportunities.
I shared my four reasons for pursuing actuarial science: working in the insurance industry, enjoying actuarial topics in college, my love of math, and my passion for continuous learning. These factors combined to make this career a natural choice for me. If you’re someone who enjoys solving complex problems, working with data, and learning new concepts, actuarial science might be the perfect fit for you too.
Thank you for reading this post—I hope it provided valuable insights into the actuarial profession and inspired some curiosity about the field. I’d love to hear your thoughts: Did any of these reasons resonate with you? Are there aspects of actuarial science you’d like to learn more about? Let me know in the comments, or feel free to reach out directly via email or LinkedIn!