Expanding Our Horizons
By Pat Teufel
One of the major questions being addressed by the CAS Board in its strategic planning is that of geographic reach. There are many views on this subject, and we encourage you to share your views as we deliberate on this important topic.
Let’s face it: our economy is a global economy. An earthquake and tsunami in Japan sends ripples throughout the global insurance market and even touches the U.S. auto market. Economic uncertainties in Greece and Italy send tremors throughout the European and global markets. A downgrade of the U.S. debt by a single rating agency sends shockwaves not only in the U.S. markets, but in markets around the world.
Virtually all major insurers, many with non-U.S. parents, operate globally. Much of the world’s reinsurance capacity resides outside of North America. Increasingly, human resources—even actuarial resources—are being deployed globally, for economic as well as experiential reasons. Today, even the smallest regional personal lines writer is impacted by international developments, albeit indirectly.
This world is very different than the world that our parents experienced. Except for my father’s military service, my parents never ventured outside North America. Their “world” was within a 100-mile radius of the town in which they were born. They considered themselves well traveled because they had honeymooned in Canada. A trip to Florida required months of planning and stress.
My “world” has been a lot broader than the world my parents experienced. While I also live and work within 100 miles of my birthplace, I traveled to Europe while in my teens as part of a study abroad experience. And I have been fortunate, in my professional career, to have had the opportunity to visit most of the United States and Canada, many countries in Europe, as well as Hong Kong, Thailand, Africa, and Australia. For me, travel has been an integral part of my business and personal experiences, as it has, I suspect, for most of you.
My children began traveling at a very young age. My eldest daughter took her first cross-country trip when she was six-months-old. She has been living in Barcelona, Spain, for the last three years and has just returned from a one-month, 10-country tour through Eastern Europe. My youngest daughter is also a traveler, having studied for a semester in Sydney, Australia, and lived for a year with her sister in Barcelona. Both daughters think nothing of packing their bags and heading to countries that didn’t even exist when I was growing up! With friends from all parts of the world, and an Internet that allows them to stay connected, my children’s “world” is broader still than mine has been.
Jump ahead to the world that my grandchildren are likely to experience. It is likely to be a very fungible world. Not only will they feel free to travel all over the world, but their employers will likely demand global mobility as a condition of employment (or offer it as an employee benefit).
So, where do we want the CAS to be in this increasingly global world? Our CAS Centennial Goal has no geographic boundaries:
The CAS will be recognized globally as a leading resource in educating casualty actuaries and conducting research in casualty actuarial science. CAS members will advance their expertise in pricing, reserving, and capital modeling, and leverage their skills in risk analysis to become recognized as experts in the evaluation of enterprise risks, particularly for the property and casualty insurance industry.
I was a member of the Board when the Centennial Goal was adopted. I, for one, believe that this global vision for the CAS is not only appropriate but necessary if we are to serve our members effectively. I see the international arena as an opportunity, a platform from which we can continue to teach and learn, share ideas, advocate for an expanded actuarial role and hopefully, along the way, grow our CAS membership. To be relevant, I believe that the CAS must continue to expand its geographic horizons and should step forward to play a more visible leadership role in the global actuarial arena. This role benefits ALL of our members, protecting their interests and expanding their opportunities.
The CAS cannot forestall the globalization of our businesses; that will occur regardless of the CAS international strategic direction. We cannot forestall the development of casualty actuarial science in other parts of the world; that will happen whether or not the CAS decides to participate in and influence the evolution. The CAS does have some fundamental decisions to make regarding our international position. We need to decide whether we will sit on the sidelines and watch as the world changes around us, or whether we will expand our role in influencing the changes and better positioning our members for the world of the future. The choice is ours to make. I vote for a strong, visible, and active presence on the international stage.
The CAS is recognized throughout the world as a leader in advancing casualty actuarial science. Employers respect and value the CAS credential. The CAS can be proud of its many contributions to practical, non-life research and its application; it continues to be a leader in advancing new processes for evaluating risk. But we no longer have exclusive claim to this domain. Many of the innovations in our science over the last decade have begun outside the CAS and outside of North America. Many of the more promising areas of growth for casualty actuaries require our working with, and learning from, other professionals to bring more robust solutions to critical business issues. Actuaries in the EU who are charged with implementing Solvency II can provide meaningful insight on risk and capital management. Actuarial professionals who are in developing markets have a unique perspective on data limitations and mitigating strategies. Statisticians who work within our pricing teams, scientists working in catastrophe or climate change areas, professionals responsible for the assessment and management of risk, all have a role to play in expanding the horizons of our members. But we need to be open to exploring these new areas.
Change is hard. It requires that we move outside of our comfort zone. It demands that we acknowledge that we don’t have all the answers. It may even require us to collaborate with others, learn new skills, and abandon long-held myths. I hope we don’t let complacency or isolationism stand in the way of an exciting, yet different, future.
CAS leadership is very interested in hearing your perspectives on international issues. We will be sponsoring a short survey and a posting a new blog poll to solicit your views on this important topic.