Reinvigorating the CAS
By Gary R. Josephson, CAS President-Elect
Having just spent the better part of a week with my three-year-old granddaughter Anna, I couldn’t help but think about the changes that have taken place in all aspects of our lives since the time my kids were her age. And one can only guess at the changes that will take place between now and the time that Anna’s kids are three. Change is a constant in our lives, and we need to adapt accordingly.
A number of years ago, I attended a presentation by Dan McCarthy, a former president of the American Academy of Actuaries (and well known to many casualty actuaries as a leader of the actuarial profession). Dan advised that to be successful, actuaries need to periodically reinvent themselves. With the pace of change in many of the things that affect our jobs—technology, regulations, competition—what served us well when we got our ACAS or FCAS is not likely to be sufficient for tomorrow’s challenges. We need to continually enhance our skills, both technical and other, in order to continue to bring value to our employers, clients, and publics.
Dan’s advice can also be applied to the CAS. We need to be able to change in response to our environment. One of our main goals as an organization has always been to be a leader in education and research for casualty actuaries. As our world became more global, we expanded our vision to become a resource to other general insurance actuaries around the world. As risk management continued to evolve, we recognized that our skills as actuaries allowed us to make unique contributions in areas that went beyond the traditional property and casualty risks.
These changes have been driven by opportunity. Changes are also driven by threats. There is no question that the SOA’s planned entry into the general insurance space creates a threat to the CAS. Competition is not new to the CAS. As our reach has spread beyond the conventional areas of ratemaking and reserving, we have clearly overlapped into areas in which other professionals may take some ownership (e.g., predictive modeling and ERM). The CAS’s role in responding to these competitive threats is to provide our members with the capacity to leverage our knowledge of insurance and risk with the tools that are continually emerging to measure these risks.
Clearly, the SOA threat is different, since it addresses the core of our being, the education of casualty actuaries. How do we respond? I believe that we start by recognizing where we are today. Our basic education, while it will have its occasional road bumps, provides the most comprehensive education for casualty actuaries in the world. Our continuing education offerings are unparalleled. Our research continues to focus on practical applications of emerging science. And, not to be forgotten in all this, our membership dues are the lowest among the three largest actuarial organizations in the U.S.
However, we cannot just assume that our current position will sustain itself. In her May 2012 Actuarial Review column, Pat Teufel expressed that as an organization we are threatened by a sense of complacency—being too slow to innovate and adapt to change. As the “only game in town,” this may have been a natural response. However, in our current environment, it is a recipe for obsolescence. We need to respond to the SOA challenge by considering this an opportunity to reenergize our activities in all of our operational areas. We need to consider alternative ways of educating future members (not as a means to water down the credential, but to recognize that options may exist to improve the process). We need to continue to deliver continuing education on relevant and cutting-edge topics, and in innovative ways. We need to push the edges of research, perhaps by creating stronger ties with academia.
Dan advised us to reinvent ourselves, but the CAS doesn’t need to do that. Why reinvent something that has served us so well? What we need to do is reinvigorate ourselves. Let’s be creative in thinking of ways to enhance our skills, our tools, our products, and ourselves. Let’s stop saying “we have never done it that way.” Let’s use our 100-year head start to leapfrog from where we are today to where we need to be in the future.