CAS Update Where Weve Been, Where We Are and Where Were Going

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CAS UpdateWhere Weve Been, Where We Are and
Where Were Going

• Casualty Actuaries of
• Greater New York
• June 3, 2004

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Agenda

• CAS Centennial Goal
• Two Important Task Forces
• Research Working Parties
• Educational Process
• Getting Involved in CAS
• CAS Web Site
• Your input

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CAS in 2014

• The CAS will be 100 years old!

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The Planning Horizon

• Core Ideology
• Core purpose
• A concise statement of the organizations reason
  for being
• Core values
• Essential and enduring tenets of the organization
  
• 10-30 Years Envisioned Future
• Big audacious goal
• 5-10 Years Critical Factors
• 3-5 Years Strategic Planning
• 1-2 Years Action Planning

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Centennial Goal (March 03)

• The CAS will be globally recognized as the
  preeminent resource in educating casualty
  actuaries and conducting research in casualty
  actuarial science. CAS members will be
  recognized as the leading experts in the
  evaluation of hazard risk and the integration of
  hazard risk with strategic, financial and
  operational risk.

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International Issues

• Historically, CAS predominantly North American
• 95 of members live and practice in North America
• Many papers and syllabus materials use U.S.
  examples
• Major meetings and seminars
• Preeminent global resource
• Support of CAS Members working abroad
• Support basic education process in various
  countries
• Exam waivers and mutual recognition
• Practice rights for CAS members (Ireland,
  Australia, India)
• Participation in international actuarial community

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Risk Integration

• Aspects of risk addressed by a multitude of
  professions
• Financial, Operational, Hazard , Strategic
• Actuaries can be uniquely positioned to integrate
  the risks
• Tools in our Education Process
• Professionalism
• Coordinating activities with the SOA
• Joint ERM Seminar summer 03 (CAS led)
• ERM and RCMS merge in 04 under CAS leadership
• In conjunction in 04 with GA State Bowles
  Research Symposium

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Implementing the Centennial Goal

• Traditionally Vice Presidents and Committee
  Chairs have annual goals
• To do list
• Only occasionally connected to long range plans
• LRPC working with other CAS leaders to change our
  short- and medium-term planning processes
• Does my goal support the Centennial Goal?
• What does my committee need to be doing in the
  next three years to support the Goal?

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CAS Board

• This is where policy is made
• Board meets 4 times per year
• May and November at the CAS meetings
• March and September
• Board meetings are open to the membership!
• Come and see how decisions are made in the CAS
• Next Board Meeting Sept. 9-10, Niagara Falls

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Two Important Task Forces

• Classes of membership
• How many classes should the CAS have?
• How should these classes be defined?
• What governance rights should ACASs have in the
  CAS?
• Vote? All ACASs? After N Years?
• Chair committees? Which ones?
• Serve as a VP?
• Serve on the Board?

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Historical Perspective on Associates

• Since inception, two classes of membership
• Associate/Fellow designations have changed over
  the years
• Initially, company responsibilities
• Beginning in 1915, exams
• Number and content of exams has changed
• Two exam differential today is lowest ever
• For 70, designation of Associate is temporary
  the remaining 30 will not complete the
  Fellowship exams and are/will be career Associates

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Task Force on ACAS Governance Rights

• Right to vote should be given to members upon
  attainment of Fellowship or five years after they
  are recognized as Associates, whichever comes
  first. Right to vote should be unrestricted.
• All voting members should be allowed to stand for
  the Board of Directors
• Voting Associates may hold all officer positions,
  with the exception of
• President / President Elect
• Vice President - Admissions
• Committee Membership is to remain restricted to
  Fellows for
• Discipline
• Education Policy
• Syllabus

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Classes of Membership Task Force

• Task Force recommendations include
• One and only one class of membership - Fellowship
• Certificate of Achievement in Casualty Actuarial
  Science
• Bring all candidates under the Code of
  Professional Conduct
• Transitional Issues
• Current Associates
• Automatic Transition (Preferred)
• Completion of some Additional Requirement(s)
• Students on the Road to ACAS
• Continue to offer Associate designation until
  2008
• Retain common set of examinations (ideally 8
  exams total)
• Action expected at September Board meeting

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Research Working Parties

• Traditional CAS Approach
• Focused on individual research
• Call paper programs
• No interaction among researchers
• Working Parties
• Focused topic
• Collaborative, interactive process
• Short (1 year) time frame with report at next
  meeting
• First parties formed at CLRS 03

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Changes to Preliminary Education

• Current
• Prerequisites Linear Algebra and Statistics
• Exam 1 Calculus and Probability (4 hours)
• Exam 2 Interest Theory, Economics, Finance (4
  hours)
• Exam 3 Actuarial Models NOT JOINT (4 hours)
• Exam 4 Actuarial Modeling (including Applied
  Stats) (4 hours)

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Changes to Preliminary Education

• Approved March 2004 Board Meeting
• Starting Spring 2005
• Prerequisites Linear Algebra and Calculus
• Exam 1 Probability (with Supporting Calculus)
  (3 hours)
• Exam 2 Interest Theory (2 hours)
• Exam 3 Actuarial Models Statistics NOT
  JOINT (4 hours)
• Exam 4 Actuarial Modeling (4 hours)
• Validation by Educational Experience Economics,
  Finance, Applied Statistics

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Validation by Educational Experience

• Option 1 Submit a grade of B- or better on
  approved courses
• Micro and Macro Economics
• Intermediate Corporate Finance
• Regression and Time Series (could be separate
  courses)
• Option 2 Pass an appropriate exam, such as the
  AP exams for Economics, CFA exams, etc.
• Option 3 Pass exams offered by the CAS. CAS is
  committed to offering these for at least 2 years
• Option 4 Other experiences
• College distance-learning courses
• Courses/seminars designed specifically for VEE
  credit

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Transition

• 2000 Syllabus
• Exam 1 ? Exam 1
• Exam 2 ? Exam 2 VEE for Economics Finance
• Exam 3 ? Exam 3
• Exam 4 ? Exam 4 VEE for Applied Stats
• Pre-2000 Syllabus
• Part 3A ? VEE for Applied Stats
• Part 4A ? Exam 2
• Part 4B ? Exam 4
• Part 5A ? VEE for Economics
• Part 5B ? VEE for Finance

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Why VEE?

• Most candidates take Economics and/or Finance
• No need to examine topics that require background
  but not mastery
• But verification is needed to meet international
  standards
• Exam questions for Applied Stats stress
  memorization rather than application
• Our candidates need to learn how to appropriately
  apply regression and time series models to real
  data
• This competency cannot easily be validated in a
  timed paper-and-pencil exam

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Impact on Travel Time

• Actuarial Science majors often graduate with two
  or more exams
• Unlikely to have much effect on these candidates
• Other majors who take VEE courses in school
  benefit
• Candidates who did not have VEE courses in school
• Can tackle VEE while studying for interest exam
• Or between exam seasons
• VEE pass rates on first attempt should be very
  high
• Increases predictability of travel time

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Other Ways to Reduce Travel Time

• Computer Based Testing
• Targeting 2005 pilot for Exam 1
• Expand to 4-6 computer-based administrations in
  2006
• Candidates will receive results immediately
  (beginning in 2006)
• Will expand to other exams if successful
• Approved May 2004 Board Meeting. Awaiting
  approval by SOA.

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Other Ways to Reduce Travel Time

• More Efficient Study Material
• Too much material not written for study purposes
• Institute of Actuaries (UK) hired one vendor to
  produce all study material
• Material written specifically for study purposes
• Enabled increased pass rates despite expanded
  syllabus breadth
• CAS Task Force determined that this could work
  for us
• Syllabus Committee charged to try this on a pilot
  basis

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Modeling Workshop

• Education in Risk Integration Techniques is
  consistent with Centennial Goal
• DFA added to Syllabus in 2000
• DFA taken off Part 8 in 2003 due to inability to
  test in a paper-and-pencil environment
• Modeling Workshop Task Force established
• Pilot a hands-on workshop experience in late 2004
• Consider adding this as a future FCAS requirement
  and/or continuing education opportunity

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Getting Involved in CAS

• Why
• Learn
• Make useful contacts
• Contribute to your profession
• How
• Pick committees/topic(s) that interest you most
• Respond to Participation Survey or contact
  committee chair directly
• Join a working party
• Write papers
• Give presentations
• Regional Affiliate involvement

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CAS Web Site (www.casact.org)

• Syllabus, study materials, past exams, study
  notes
• All PCAS (1914), CAS Forums (1987) and Discussion
  paper programs (1979), ASTIN Journals
• ASOPs, Casualty Reserve Practice Note
• Discussion forum
• Member Services
• Membership Directory
• CAS Board QA
• Board minutes

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We welcome your input regarding . . .

• Centennial Goal
• CAS role internationally
• CAS role outside traditional p/c insurance
• Exams and Education Process
• Travel time
• Membership
• Research working parties
• Whats on your mind?
• Questions?

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THANK YOU !!!!!