Meet the Candidates - Michael R. Larsen

Education:

Master of Actuarial Science, Graduate School of Business University of Michigan, May 1978
B. S. Mathematics, University of Iowa, July 1975

Current Employment:

Retired as of June 2019

CAS Activities and Publications:

Activites

Exam Committee Role by Exam and Year:

Other Committee Membership:

Speaker by Event and year:

Publications

“A Proposed New Direction for the CAS Syllabus and Exams”, Actuarial Review, September/October 2022, Pages 50-54

“When You’re Not Preaching to the Choir Presenting DFA Analysis Results”, Contingencies, July/August 2006, Pages 74-76

“Presenting DRM Results to Decision Makers”. The Actuarial Review, August 2004

“Presenting DRM Results to Decision Makers: A Summary Report”, 2004 CAS Fall Forum, Pages 317- 331

Other Professional Designations:

Member, Data Science & Analytics Committee, American Academy of Actuaries, 2023

Other Professional Designations:

Member, American Academy of Actuaries, 1988

Employment History - Prior Employers:

The Hartford, Hartford, Connecticut: 2001-2019
Nationwide Insurance Company, Columbus, Ohio:1998-2000
TIG Insurance Company, Irving, Texas: 1996-1997
Trinity Universal Insurance Companies, Irving, Texas: 1994-1996
Republic Insurance, Dallas, Texas: 1990-1994
St. Paul Insurance Company, St. Paul, Minnesota, 1984-1989
CNA Insurance, Chicago, Illinois: 1978-1983

Civic Activities:

President, Broad Hill Homeowner Association: 2020-2022
Member, Granby Land Trust
Member, Holcomb Farm

Awards and Recognitions:

Above and Beyond Achievement Award, Casualty Actuarial Society: 2015

The primary reason that I want to serve on our Board is to have a seat at the table when they are talking about the goals for our basic education program and how best to achieve those goals. I am particularly interested in how we can improve our coverage of predictive analytics in our basic education program and potentially reuse that material to help our current members improve their skill set in that area. How to ensure that the direction we take in updating our basic education program is in synch with the views of a majority of our membership is another issue that I believe merits attention.

Our basic education program has not kept up with the changes in how predictive analytics can be applied to P&C actuarial work. Not every candidate will have a career requiring hands-on modeling, yet knowledge of how those techniques can be applied in P&C actuarial work will become increasingly essential to safely write a statement of actuarial opinion.

We need to improve our coverage of predictive analytics, yet we have topics beyond predictive analytics that we have to cover. Our candidates must acquire the specialized vocabulary of P&C actuarial work, understand the regulatory environment in which we work and be able to speak the same language as their counterparts outside of the actuarial areas. Selecting which topics can be dropped or scaled back to avoid increasing travel time will involve some difficult tradeoffs. Improving coverage of predictive analytics as applied to advanced reserving and ratemaking will require either finding or developing new study material. Training the item writers on how to write effective questions on that new material requires some care. I have lived through those issues (on a smaller scale) when developing the MAS exams and I believe that my experience would be useful as we move to update our basic education program.

Most of the commonly used modeling techniques in use today became available well after I graduated from college and attained Fellowship. In the second half of my career, I focused on modeling work and had to acquire a working knowledge of those techniques via self-study. I believe that experience gives me some empathy with our members who would like to improve their modeling skill set to survive and thrive in a changing workplace but are not sure where to start.

Part of the challenge in updating our basic syllabus involves leading a change in culture, yet we need to stay in synch with the membership. At one time, we had to go our own way since the classic statistics tools available did not meet our needs. Today, the extensive tool kit from data science means looking outside of our current practices and learning to adapt those tools to our needs is the practical route to follow. Then too, we should use existing textbooks and training sources rather than developing our own material whenever possible to enable our candidates to speak the same language as their data science colleagues and manage our investment in volunteer time required to update and maintain our basic education program.

Membership buy-in

We need to institute an open forum with published member questions and CAS responses for both new and ongoing exam and syllabus issues. Material changes should be vetted with the membership before implementation using a process similar to the American Academy of Actuaries ASOP development procedure.

Releasing exam questions and answers

We stopped releasing exam questions and answers in 2020 which curtailed the flow of study material to candidates and made it difficult to write effective challenges. We should resume releasing the exam questions and answers.

Preliminary basic education program

We should change our preliminary exams to focus on predictive analytics topics that are commonly available while in college by splitting the current MAS I exam to create new Exam 2 (Probability Models & Classic Statistics) & Exam 3 (Generalized Linear Models & Time Series). The current Exam 2 (Financial Mathematics) as well as general Finance topics on our current Exam 9 should be moved to VEE type credit. VEE credit should be expanded to include credit for an introduction to P&C insurance college courses while dropping the online courses from The Institute from the preliminary track. If our preliminary exam program is consistent with commonly available courses that help meet graduation requirements, we broaden the appeal of the actuarial career track and potential candidate pool.

Hands-on Modeling

We should expand VEE type credit to include either college level courses that require hands on modeling or selected commercial vendor programs leading to certificates verifying hands-on modeling experience rather than building our own separate exam. Testing the ability to code and build models at the level of rigor implied by our exams along with the cost in volunteer time is not warranted, yet some exposure to hands-on modeling is necessary.

Advanced reserving and ratemaking material

Our existing readings should be culled and consolidated to remove outdated material. An extended set of examples (both Study Notes and downloadable annotated program files in R and Python) should be created that would illustrate how to apply currently available open-source predictive analytical tools to reserving and ratemaking problems.