Actuarial exam

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Actuarial exams are a series of professional level examinations which must be passed in order to be admitted into an actuarial society, if the society has a "membership through examination" requirement.


In Australia, the examinations are offered by Institute of Actuaries of Australia to acquire its fellowships.[1] The primary levels of the examinations can also be taken via some of Australian universities, which will lead to the qualification of the associateship [2],.[3]


To qualify as an actuary in Canada, a candidate must become a Fellow of the Canadian Institute of Actuaries (CIA). To do so an individual must be either a Fellow of the Society of Actuaries (FSA) or a Fellow of the Casualty Actuarial Society (FCAS) and meet certain experience and continuing education requirements.

United Kingdom[edit]

In the United Kingdom, exams are offered by the Institute and Faculty of Actuaries. ActEd[4] (The Actuarial Education Company, a subsidiary of BPP Actuarial Education Ltd.) is contracted to provide actuarial tuition for students on behalf of Institute and Faculty Education Ltd (IFE), a subsidiary of the Institute and Faculty of Actuaries.[5]

Students of the Institute and Faculty of Actuaries must sit 15 exams to qualify as a Fellow. In the UK, the term 'actuary' refers exclusively to Fellows of the I&FoA.

The exams [6] are split into four blocks - consisting of 9 'core - technical' exams, 3 'core-applied' exams, 2 'specialist-technical' exams and 1 'specialist-applied' exam. These are commonly referred to as 'CT', 'CA', 'ST' and 'SA' exams. All students must sit all 12 'Core' exams - and then select 2 of the 'ST' exams and 1 of the 'SA' exams.

Completion of exam ST9 (Enterprise Risk Management) will allow a qualified Fellow to also register as a Chartered Enterprise Risk Actuary.

The 'Core Technical' exams are:

Subject CT1 - Financial mathematics Subject CT2 - Finance and financial reporting Subject CT3 - Probability and mathematical statistics Subject CT4 - Models Subject CT5 - Contingencies Subject CT6 - Statistical methods Subject CT7 - Business economics Subject CT8 - Financial economics Subject CT9 - Business awareness (this is a two-day residential)

The 'Core Applied' exams are: Subject CA1 - Actuarial risk management Subject CA2 - Model documentation, analysis and reporting (this is a one day practical assessment) Subject CA3 - Communications (this is a one to two day practical assessment that can be taken online or in-person).

The 'Specialist Technical' exams are: Subject ST1 - Health and care Subject ST2 - Life insurance Subject ST4 - Pensions and other benefits Subject ST5 - Finance and investment A Subject ST6 - Finance and investment B Subject ST7 - General insurance: reserving and capital modelling Subject ST8 - General insurance: pricing Subject ST9 - Enterprise risk management

The 'Specialist Applied' exams are: Subject SA1 - Health and care Subject SA2 - Life insurance Subject SA3 - General insurance Subject SA4 - Pensions and other benefits Subject SA5 - Finance Subject SA6 - Investment

There is also an optional 'practice module' for each of the 6 'SA' exams. The practice module is a legal requirement for reserved roles in the UK finance sector.

All Fellows must also sit a 'Professionalism' course after qualifying. The course is not examined and covers the standard of behaviour expected from a Fellow of the Institute and Faculty of Actuaries.

Members of the US SOA or CAS may also register as Fellows at the UK Institute and Faculty of Actuaries.

United States[edit]

In the United States, the two largest professional organizations are the Society of Actuaries (SOA) and the Casualty Actuarial Society (CAS). CAS members are largely trained to work in the property and casualty insurance field. SOA members are trained to work all branches of actuarial science. Both organizations have a common set of preliminary exams. CAS has a single set of advanced exams. SOA has six sets of advanced exams, one set for each of their six domains of competency.

Preliminary Exams[edit]

There are five preliminary exams. Most of the exams are multiple choice and administered on computers at Prometric testing centers. Candidates are allowed to use a calculator from an approved list.[7] The exams are timed and last three hours. Some tests provide instant feedback as to whether or not a candidate has passed that particular exam (see table below). All test scores (on a 0-10 scale with 6 or higher passing) are posted six to eight weeks after the test.

Through the end of 2013, four of the preliminary exams (all but MLC and 3L) were jointly sponsored by CAS and SOA. In late 2012, SOA announced its intention to end joint sponsorship beginning with tests administered in January 2014. CAS has not announced plans to develop alternative forms of the jointly sponsored exams; however, it will accept SOA exams for CAS credit.

SOA administers exam MLC, which covers life contingencies topics. Starting in May 2014, MLC includes both multiple choice and open-response questions. SOA made this change because, in their view, strict multiple-choice questions are not sufficient or adequate to test whether the candidates are familiar and fluent in the material. The test is four-hours long, allows calculators, and is administered via a paper-and-pencil format. Multiple choice questions account for 40% of the exam, and open-response questions account for 60% of the exam. Candidates may freely move between the two sections. The two sections will be graded separately. However, since the multiple-choice questions will be easier, only candidates who have answered a certain percentage of the multiple-choice questions correctly will have their written answers graded.

CAS develops exam LC, an alternative to SOA's exam MLC. Exam LC covers many life contingencies topics that are covered by MLC. The exam is administered using paper-and-pencil format and has only multiple choice questions. SOA does not recognize CAS's exam LC. CAS also administers the ST, which covers statistical and stochastic methods not tested by the LC or the MLC. Those candidates who passed 3L or MLC before 2014 are exempt from taking LC and ST.

SOA Exam CAS Exam Exam Title Exam Topics Format Tests per Year Pass/Fail Estimate
P 1 Probability Basic, univariate, and multivariate probability Computer 6 Yes
FM 2 Financial Mathematics Basic interest theory, annuities, bonds, loans, cash flows, portfolios, immunization, and financial derivatives, options, hedging, investment strategies, forwards, futures, and swaps Computer 6 Yes
MFE 3F Actuarial Models: Financial Economics Interest rate models, rational valuation of derivative securities, and risk management techniques Computer 3 Yes
MLC LC Actuarial Models: Life Contingencies Survival models, Markov chain models, life insurances and annuities, Traditional and Universal Life Models Paper and pencil 2 No
-- ST Models for Stochastic Processes and Statistics Poisson processes, maximum likelihood estimation, statistical hypotheses, Neyman-Pearson lemma, order statistics, normal models, and Bayesian statistics Paper and pencil 2 No
C 4 Construction and Evaluation of Actuarial Models Severity models, frequency models, aggregate models, construction of empirical models, construction and selection of parametric models, estimating failure time and loss, determining the acceptability of a fitted model, credibility, simulation Computer 3 Yes

Validation by Educational Experience[edit]

Candidates for CAS and SOA membership must pass standardized tests in introductory economics, corporate finance and applied statistics. Economics has two components: macroeconomics and microeconomics. Applied statistics has two components: regression and time series. Instead of passing exams, candidates may earn credit by passing an approved college class with a B- or better grade or by completing an approved correspondence class.

CAS Advanced Exams[edit]

To earn associate membership (ACAS), a candidate must pass the preliminary exams, VEE, two online modules, exam five, and exam six. For an associate to become a fellow (FCAS), exams seven through nine must be passed. The exams are administered on paper-and-pencil. Exam questions generally require an open answer; however, multiple-choice questions are allowed, too. Exam six comes in two versions: one for candidates in the United States and one for candidates in Canada.

CAS Exam Subject Matter Test Window
Exam 5 Basic Techniques for Ratemaking and Estimating Claim Liabilities Early May, Late October
Exam 6 Nation-Specific Examination: Regulation and Financial Reporting Early May, Late October
Exam 7 Estimation of Policy Liabilities, Insurance Company Valuation, and Enterprise Risk Management Early May
Exam 8 Advanced Ratemaking Late October
Exam 9 Financial Risk and Rate of Return Early May

The two modules that must be completed to become an associate are...

Module Subject Matter
Module 1 Risk Management and Insurance Operations
Module 2 Insurance Accounting, Coverage Analysis, Insurance Law, and Insurance Regulation

The exam schedule above started in 2011. Candidates who passed exams offered before 2011 will be granted credit according to the following schedule. To earn credit for new exam five, a candidate must pass old exam five and old exam six. Candidates who passed one of old exam five and old exam six must pass a special exam covering the remaining material on new exam five.

Old Exam Conversion credit
Old Exam 5 Half of New Exam 5 on Basic Ratemaking plus Module 1 (Risk Management and Insurance Operations)
Old Exam 6 Half of New Exam 5 on Basic Reserving plus New Exam 7
Old Exam 7 New Exam 6 plus Module 2 (Insurance Accounting, Coverage Analysis, Insurance Law, and Insurance Regulation)
Old Exam 8 New Exam 9
Old Exam 9 New Exam 8

SOA Advanced Exams[edit]

After passing the preliminary exams, SOA candidates complete the Fundamentals of Actuarial Practice e-learning course and the Associateship Professionalism Course. FAP contains eight learning modules and two assessments. APC is a live, in-person seminar held in different places around the country. This completes the requirements for associate membership (ASA).

Associates select one of six areas of competence in which they can further their training. Each area has three or four exams and three learning modules. Exam one for "Retirement Benefits" have alternative requirements that are specific to Canada and the United States. For all tracks other than "Corporate Finance and Enterprise Risk Management," a candidate may pass the "Enterprise Risk Management" exam as a substitute for exam three. After completing the exams and modules, candidates must pass the "Decision Making and Communication Module" and the "Fellowship Admissions Course" before earning promotion to fellow (FSA).

Type General Insurance Corporate Finance and Enterprise Risk Management Quantitative Finance and Investment Individual Life and Annuities Retirement Benefits Group and Health
Exam 1 Introduction to General Insurance Strategic Decision Making Quantitative Finance and Investment Core Life Pricing Funding and Regulation (Canada) or Enrolled Actuaries Series (US) Group and Health Core
Exam 2 Introduction to Ratemaking and Reserving Corporate Finance Foundations Quantitative Finance and Investment Advanced Life Finance and Valuation Design and Accounting Exam Group and Health Advanced
Exam 3 Advanced Topics in General Insurance Enterprise Risk Management Investment Risk Management Life Risk Management Retirement Plan Investment and Risk Management Group and Health Specialty
Exam 4 Financial and Regulatory Environment
Module 1 Enterprise Risk Management Enterprise Risk Management Enterprise Risk Management Enterprise Risk Management Enterprise Risk Management Enterprise Risk Management or Health Foundations
Module 2 Financial Economics Financial Reporting Financial Reporting Financial Economics Financial Economics Financial Economics
Module 3 Applications of Statistical Techniques Advanced Topics in Corporate Finance Financial Modeling Regulation & Taxation Social Insurance Pricing, Reserving & Forecasting

Chartered Enterprise Risk Analyst[edit]

This is a designation offered by both CAS and SOA.

CAS candidates must complete all of the requirements to become a FCAS except for exam eight. They must also complete exam ST9, Enterprise Risk Management Specialist Technical, administered by the Institute and Faculty of Actuaries (U.K.) and the Enterprise Risk Management and Modeling Seminar for CERA Qualification

SOA candidates must complete all of the preliminary exams except for exam MLC. Candidates must also pass VEE Economics, VEE Corporate Finance, Fundamentals of Actuarial Practice, the Enterprise Risk Management exam, the Enterprise Risk Management module, and the Associateship Professionalism Course.

Enrolled Actuary[edit]

In the US the term "Enrolled Actuary" is applied to an individual who has taken certain exams sponsored by the Joint Board for the Enrollment of Actuaries relating to pension plans. Enrollment in the Joint Board is a requirement for SOA Retirement Fellows working in the US.

The American equivalent of the Canadian Institute of Actuaries is the American Academy of Actuaries (AAA).

Other Nations[edit]

Actuarial bodies in other countries offer their own series of exams (although, as previously noted, there are some countries where the term "actuary" is applied to individuals with a university degree in Actuarial Science).


See also[edit]

External links[edit]