1. Life as an Actuary Matthew Mikola 14/3/2012 Life as an Actuary 14.03.12

2. Agenda What is an Actuary? Areas Actuaries work in The Exams! My Roles at Aviva – Protection Pricing – With Profits Reporting – Solvency II Project Opportunities at Aviva Q & A Life as an Actuary 14.03.12

3. What is an Actuary? Future uncertainty or risk Business and Statistical knowledge Models to value the financial impact Problems they help solve: Risk management Investment Strategy Business Problems

4. Life as an Actuary 14.03.12 Areas Actuaries work in Insurance - Life - General Pensions Consultancy Investment Government Contractor Any area with uncertainty and risk

5. Life as an Actuary 14.03.12 The Exams! 9 Core Technical: Cashflows Accountancy 2 * Statistics Mortality Life Assurance Economics Options and Derivative pricing (Black Scholes) Business Awareness 3 Core Application - general, modelling, communication 3 Specialist

6. My Roles at Aviva Protection Pricing Life as an Actuary 14.03.12

7. My Roles at Aviva Protection Pricing Protection = financial security to dependents upon death or illness Pricing = calculate the premium to charge the policyholder Balance: o Profit o Competitiveness Products: o Term Assurance => loan/mortgage cover o Whole of life => inheritance/funeral expenses o Critical Illness => pay medical expenses/loans

8. Life as an Actuary 14.03.12 Protection Pricing - Day to Day Factors: Age Sex Smoker status Each combination known Marriage status as a "Cell" Term Benefit amount

9. Life as an Actuary 14.03.12 Protection Pricing - Day to Day 1.Profit Testing Sample subset tested Reflect actual number of policies sold by scaling Set premiums for each "Cell" Choose model assumptions Analyse expected profit Sensitivity test

10. Life as an Actuary 14.03.12 Protection Pricing - Day to Day 2.Competitor Matching Find out premiums charged by other companies See where we rank How much premiums differ by If we beat their premium, how it affects profitability

11. My Roles at Aviva With Profits Reporting Life as an Actuary 14.03.12

12. My Roles at Aviva With Profits Reporting With Profits = Savings product where the benefits equal: o guaranteed minimum amount o increased by discretionary bonuses Reporting = Actual profit to shareholders and market Reserves to regulator Reserves = money held to meet benefits indication of financial security

13. Life as an Actuary 14.03.12 With Profits Reporting - Day to Day Reporting Period Update the assumptions Obtain results Analysis Prepare reports

14. Life as an Actuary 14.03.12 With Profits Reporting - Day to Day Other Times Improve the model Add new products Improve processes

15. My Roles at Aviva Solvency II Project Life as an Actuary 14.03.12

16. My Roles at Aviva Solvency II Project New regulatory framework for: Measuring risk taken on Measuring financial security Enough capital to support the business Benefits of Solvency II: Boost consumer protection and confidence Reward good risk management Improve transparency of information Impacts many areas of the business

17. Life as an Actuary 14.03.12 Solvency II Project - Day to Day Initially Analyse impact to existing models/processes Writing development papers Development & Testing of New Asset Model More accurately calculate the value of our assets Asses impact due to market stress tests

18. Life as an Actuary 14.03.12 Opportunities at Aviva Summer Internship Penultimate year students 2 months – paid Send CV to: richard.kingston@aviva.co.uk Graduate Roles www.aviva.co.uk/graduates

19. Summary What is an Actuary? Areas Actuaries work in The Exams! My Roles at Aviva – Protection Pricing – With Profits Reporting – Solvency II Project Opportunities at Aviva Q & A Life as an Actuary 14.03.12

20. © Aviva plc 2012 Any Questions? matthew.p.mikola@aviva.co.uk Life as an Actuary 14.03.12