Members Share Views, Concerns on Professionalism

by Roger A. Schultz, Chairperson
CAS Committee on Professionalism Education

Professionalism Supported, Education Needed

Based on a recent survey, professionalism education was found to be widely supported by the membership. A majority (66 percent) of survey respondents thought that ALL members of the CAS should be required to have professionalism education. About the same number (64 percent) said they have attended a general session or break-out session on professionalism at a CAS meeting or seminar. A larger majority (81 percent) supported the provision in the recent Qualification Standard exposure draft enabling up to 25 percent of continuing education to be earned through professionalism education.

A significant minority of members (31 percent) do not believe this education should be required. About the same number (34 percent) indicated they had never attended a professionalism session at a convention or seminar. Some felt that, if there was an educational requirement, it should be a one-time only requirement and not subject to continuing education.

On balance, however, there was a fair amount of interest in education tailored toward the existing membership and strong support for the present professionalism requirements.

Member Concerns

The members were also given an opportunity to identify the major professionalism and/or ethical issues faced by the CAS. Based on responses, the single biggest issue for the membership (by a wide margin) relates to conflict of interest. While this takes many different forms, the biggest concern is balancing professional obligation with the interest of others, most often an employer or client.

Two significant conflict of interest issues were frequently cited. The first was with regard to loss reserving work, most notably annual statement loss reserve opinions. The concern related to the actuary's need to fulfill his or her fiduciary responsibilities within the context of a client or employer relationship, where the client or employer often has a preferred outcome. The seriousness of this issue was underscored by comments expressing a genuine concern about the quality of work being done to support annual statement loss reserve opinions.

The second significant conflict of interest issue related to the application of our professional guidelines, as embodied in the Standards of Practice and the Code of Conduct. For example, one survey respondent was concerned about the "inability to prove differences between reasonable actuarial 'opinion' and dishonesty."

Future Actions

It is clear that additional education tailored to the practitioner is viewed as useful by a large proportion of members. The CAS Committee on Professionalism Education will take action to provide this needed education.

The CAS recognizes the serious concern expressed in the survey regarding the quality of work of some of our members. The ABCD process is the appropriate vehicle to address practical issues. Yet, despite the fact that the ABCD process is confidential, our survey results suggest that it is underutilized. The latest ABCD annual report indicated that only ten new casualty cases were received in 1996. This number includes requests for guidance, as well as more serious complaints about practice requirements.

Perhaps the ABCD process is not well understood. Additionally, there may be some barriers that prevent the membership from utilizing the present process. Such barriers need to be identified, articulated, and, if possible, addressed. The CAS and AAA will be working together to address these concerns.