Pay-as-you-drive Motor Insurance

If you use your car very infrequently, I think you would like the idea of pay-as-you-drive motor insurance policy.

In UK, you can have your motor insurance premium based on distance covered and the time of day or night you use your vehicle. This is achieved through a monitoring device called Coverbox which monitors your driving habits.

Actuaries would love this as well because it will provide very detailed data for them to improve on their pricing models.

Source: Insurance Daily

Fidelis Opposes Merger of Institute and Faculty

A group called Fidelis has been formed by actuaries who are against the merger of the 160-year-old Institutie of Actuaries and the 152-year-old Faculty of Actuaries. The merger was approved by members of both bodies 6 months ago. However, Fidelis claims that the joint councils of both bodies have not paid enough attention to the disadvantages and costs of the merger.

Source: The Herald

Actuaries to Study Feasibility of Retrenchment Fund

Actuaries will be involved in studying the possibility of a retrenchment fund in Malaysia. The Human Resources Mininster said that the government was in the midst of studying the implications of setting up a retrenchment fund for workers.

“The ministry has held discussions at various stages and we have now asked actuarial and International Labour Organisation experts to help us."

Source: The Star

Manulife's CEO Resigns

Peter Robertson, the CEO of Manulife Insurance (Malaysia) Berhad, has resigned and he would leave the company on 11 November 2008.

Peter joined Manulife in 2006. He is an actuary (Fellow of the Faculty of Actuaries) by training.

Source: Bursa

Spouses with Same Sex are Allowed

This may not come to this region soon.

In US, Blue Cross & Blue Shield announced that legally married same-sex couples will be entitled to enjoy spousal benefits in the health insurance plans.

While we do have health plans designed with spousal benefits in Malaysia (in particular employer-sponsored plans), same-sex marriage is not yet legal here.

The decision by Blue Cross & Blue Shield would put some challenge to the actuaries. Typically claims statistics are collected by sex. The spouse of a male policyholder is always assumed to be a female and vice versa. With same-sex spouses allowed, theoretically the pricing would be out. It would be interesting to see how US actuaries allow for this. Anyone with knowledge in this is welcome to comment on this.

Source: WKBW

ASM Celebrates 30th Anniversary

Actuarial Society of Malaysia (ASM) celebrated its 30th anniversary yesterday evening at Prince Hotel in Kuala Lumpur.

7 past presidents of ASM were invited to the function. The dinner function was preceded by actuarial talks by 2 ASM's members. A short EGM was then called to approve the change in the Constitutions of the Society.

10 newly qualified actuaries (Yes! You read it right - TEN!) in 2007 and 2008 were also given recognition by ASM yesterday evening.

Notably, some appointed actuaries did not show up yesterday. Were they too busy with the Q2 RBC submission?

Source: TAS

Equitable Life - Maladministration by Regulators

The Parliamentary Ombudsman to the UK Equitable Life case has concluded that the maladministration of the former Department of Trade and Industry, the Government Actuary's Department and the Financial Services Authority has contributed to the Equitable Life debacle.

Some of the mistakes made are:

• One person was permitted to play both the role of Chief Executive and Appointed Actuary for more than 6 years, this has weaked the Appointed Actuary's role as whistle-blower
• The calculations of solvency position was not challenged, the financial position of Equitable Life was not properly verified
• Misleading information was permitted to be provided to policyholders and potential policyholders
• Equitable Life was permitted to take credit for a reinsurance arrangement which had not been concluded

Two recommendations were made by the Ombudsman:

• The public bodies to apologise for the failure
• A compensation scheme to be set up by Government for those affected

The Ombudsman's report is 1,800 pages long but regulators may want to take time to read the report as it is certainly a valuable lesson learned although in the hard way.

Source: Ombudsman's Press Release

2 New UK Fellows

The UK Institute of Actuaries released the results of April 2008 examinations on 4 July. We are pleased to announce that Malaysia has 2 additional actuaries.

Congratulations to Wan Saifulrizal Wan Ismail and Yoon Yew Khuen!

Source: Institute of Actuaries

MNRB to set up Actuarial Consulting Firm?

Apparently MNRB is thinking of setting up its own actuarial consulting firm in future.

In the past, MNRB has been giving out actuarial scholarships. It is keen on producing more qualified actuaries in Malaysia and eventually consider setting up a company specialising in actuarial science. The company will be 49% owned by MNRB and the rest owned by the qualified actuaries in the company.

Is this a dream likely to be realised and how soon? What do you think?

Source: Business Times

India is Short of Actuaries

India has a 20-25% shortfall of actuaries. The shortage is the worst in the general and health insurance fields.

A qualified actuary with 10 years of experience can earn around Rs 85 lakh (USD214,000) p.a. in India.

According to the membership statistics of the Institute of Actuaries of India:

• Number of fellows: 217 (31/3/2007), 213 (31/3/2006)
• Number of fellows resident in India: 129 (31/3/2006)
• Number of fellows age <= 65: 137 (31/3/2006)

Assuming the same proportion of actuaries younger than age 66 resides in India, we estimate that there are around 83 fellows in active employment in India.

Source: Business Standard & Institute of Actuaries of India

Actuary has an Edge

Utar recently organised a talk by Dr Tan Ken Seng of the University of Waterloo, Canada, entitled "Educating the 21st Century Actuary".

Dr Tan's advices to the students are:

• To aim for full professional qualifications to gain the edge.


• To improve on report-writing, marketing and research skills.


• Stochastic modelling becomes increasingly important.

http://thestar.com.my/education/story.asp?file=/2008/4/6/education/20788486&sec=education

Kenneth Wong Leaving BNM

Kenneth Wong, the Senior Actuary of Bank Negara Malaysia (BNM), today announced that he was leaving BNM, after 3 and 1/2 years with them. His last day with BNM is apparently 31 March 2008.

There is no news on where he is heading to.

A replacement apparently is being identified and will be announced soon. Meanwhile, Kenneth announced that business was as usual in BNM as they have a strong and capable actuarial team in the Bank.