CAS Rejects Mutual Recognition

SAN FRANCISCO, Ca.—The CAS Board of Directors approved the recommendations of the CAS Task Force on Mutual Recognition and decided against a proposal to implement a program of mutual recognition at its Board Meeting in November 1999. As a result of the task force's findings, the CAS will not seek to enter into bilateral agreements with other actuarial organizations for reciprocal Fellowship status to Fellows wishing to practice in the host country of the other organizations. The Board also approved continuation of several initiatives regarding examination waivers and insuring that qualified actuaries are not barred from practice in the U.S. or in other jurisdictions.

In 1998, leaders of the Institute of Actuaries, the Faculty of Actuaries, and the Institute of Actuaries of Australia approached the CAS to consider establishing a program of mutual recognition. Under mutual recognition, a series of bilateral agreements would be executed between the participating organizations referred to as the "home organization" and the "host organization." Under these agreements, a "home organization" Fellow would become a Fellow in the "host organization" after some period of residency and passing the local professionalism course plus possibly some local law/regulation course or exam.

Articles concerning mutual recognition and other global issues appeared in The Actuarial Review (August, 1999). There was also significant feedback from the membership, including letters and e-mail to the task force, letters to the editor of The Actuarial Review, comments at Regional Affiliate meetings, and even a petition to the Board of Directors.

After deliberating on the considerable feedback from the membership and taking into account the pros and cons, the task force concluded that the CAS had more to lose by entering into mutual recognition agreements than it had to gain. In particular, the task force found that:

• In the United States and Canada, there is no significant barrier to practice for general insurance actuaries accredited by organizations other than the Casualty Actuarial Society.

• In Canada, Fellowship in the Canadian Institute of Actuaries is afforded equally to Fellows of the CAS, the SOA, the Institute of Actuaries, the Faculty of Actuaries, and the Institute of Actuaries of Australia who meet specific Canadian education and practice requirements.

• In the United States, the American Academy of Actuaries promulgates qualification standards for actuaries signing prescribed statements of actuarial opinion. Membership in the Academy is open to actuaries qualified by numerous organizations, including the Institute/Faculty and soon to include the Australian Institute. The qualification standards address requisite knowledge, experience and continuing education, but do not require membership in a particular credentialling organization for qualification.

• The credentials provided an actuary through completion of the Casualty Actuarial Society syllabus of examinations differ significantly from those provided by other examining organizations. Specifically, the CAS syllabus is uniquely focused in a particular specialty area, general insurance, while other societies provide a broader education covering multiple areas of actuarial practice with less depth in general insurance.

• Fellowship in the CAS is recognized outside the United States and Canada as a desirable designation for general insurance actuaries in addition to or, in some instances, in lieu of local credentials.

• The CAS recognizes the examinations offered by other actuarial organizations and provides waivers of many of its examinations for actuaries educated under other examination systems. The CAS Education Policy Committee has reexamined the current waiver policies in light of recent changes in both the CAS syllabus and the syllabus of the Institute and Faculty of Actuaries and will recommend that the CAS waive up to seven or eight CAS exams for candidates who have completed the expanded Institute/Faculty general insurance exams.

• The CAS recognizes the qualifications of general insurance actuaries who are Fellows of other organizations and invites them to become Affiliate members in the CAS. Affiliate members are entitled to all the privileges of CAS membership other than voting and membership on admissions committees. Also, Affiliate members do not append CAS initials to their signatures.

In completing its mission, the task force devised a set of recommendations to the Board of Directors that, in addition to recommending that the CAS not seek to enter into bilateral Fellowship agreements with other actuarial organizations, proposed that the CAS continue to:

• Recognize the qualifications of general insurance actuaries through Affiliate membership and through waiver of examinations toward Associateship and Fellowship in the CAS.

• Work with the American Academy of Actuaries and the Canadian Institute of Actuaries to ensure that qualified actuaries are not barred from practice in the United States and Canada.

• Work with actuarial organizations throughout the world to ensure that qualified actuaries are able to practice in all jurisdictions.

The challenge for the CAS going forward will be to communicate the reasons for this decision to the other organizations and to ensure that its position does not hurt the ability of CAS members to compete outside North America.

The complete text of the task force's report is posted on the CAS Web Site at http://www.casact.org/about/reports/tfmutrecog.htm and a copy can be obtained by request from the CAS Office.