The CAS Basic The CAS Basic The CAS Basic The CAS Basic Education SystemEducation SystemEducation SystemEducation System

Jim Dornfeld, FCAS MAAA CPCU ARM

Iowa Actuaries Club

February 14, 2017

Casualty Actuarial SocietyCasualty Actuarial SocietyCasualty Actuarial SocietyCasualty Actuarial Society

• World’s only actuarial organization exclusively focused on property and casualty risks.

• 100+ year track record in training property/casualty actuaries

• Over 7,500 members worldwide, and growing

• Vibrant, growing community with extensive resources and strong employer support that helps CAS members, candidates, and students advance their careers.

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Current CAS Syllabus to Reach ACASCurrent CAS Syllabus to Reach ACASCurrent CAS Syllabus to Reach ACASCurrent CAS Syllabus to Reach ACAS

• Validation by Educational Experience (VEE):

– VEE-Corporate Finance

– VEE-Economics

• Two CAS Online Courses:

– Online Course 1—Risk Management and Insurance Operations

– Online Course 2—Insurance Accounting, Coverage Analysis, Insurance Law, and Insurance Regulation

• Course on Professionalism

• Exams

Current CAS Syllabus to Reach ACASCurrent CAS Syllabus to Reach ACASCurrent CAS Syllabus to Reach ACASCurrent CAS Syllabus to Reach ACAS

Required CAS Learning Objectives

Met Through Following Exams

CAS Exams

– P—Probability

– FM—Financial Mathematics

– MFE—Models for Financial Economics

– C— Construction and Evaluation of Actuarial Models

– Exam S – Statistics and

Probabilistic Models

– Exam 5—Basic Techniques for

Ratemaking and Estimating Claim Liabilities

– Exam 6—Regulation and

Financial Reporting (Nation Specific) – Actuarial Institute of Chinese Taipei,

China Association of Actuaries, Canada, and United States

Current CAS Preliminary Education Current CAS Preliminary Education Current CAS Preliminary Education Current CAS Preliminary Education WaiversWaiversWaiversWaivers

• For CAS learning objectives currently addressed through Exams 1/P, 2/FM, 3F/MFE, and 4/C, CAS will grant waiver to candidates who receive credit for exams offered by other organizations deemed to cover CAS learning objectives in acceptable depth and breadth.

– Society of Actuaries

– Actuaries Institute (Australia)

– Actuarial Society of South Africa

– Canadian Institute of Actuaries

– China Association of Actuaries

– Institute and Faculty of Actuaries (UK)

– Institute of Actuaries of India

Current CAS Syllabus to Reach Current CAS Syllabus to Reach Current CAS Syllabus to Reach Current CAS Syllabus to Reach FCASFCASFCASFCAS

ACAS plus:

• Exam 7—Estimation of Policy Liabilities, Insurance Company Valuation, and Enterprise Risk Management

• Exam 8—Advanced Ratemaking

• Exam 9—Financial Risk and Rate of Return

CAS Announced Two New ExamsCAS Announced Two New ExamsCAS Announced Two New ExamsCAS Announced Two New Exams

• Effective in 2018

• Replacements for Existing Requirements

• Addresses the emerging needs of future actuaries and their employers

• Increases the relevance of the CAS exam syllabus with respect to emerging statistical and analytics skills

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Modern Actuarial Statistics I (MASModern Actuarial Statistics I (MASModern Actuarial Statistics I (MASModern Actuarial Statistics I (MAS----I)I)I)I)

• Largely a modification of current CAS Exam S

• Similar to Exam S, but with more emphasis on applied modeling and a deeper coverage of generalized linear models

• First offered in the spring of 2018

• Transition rule: candidates with credit for Exam S achieved through an examination administered prior to January 1, 2018 will receive credit for MAS-I

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Modern Actuarial Statistics I (MASModern Actuarial Statistics I (MASModern Actuarial Statistics I (MASModern Actuarial Statistics I (MAS----I)I)I)I)

Topics Covered:

• Probability Models (Stochastic Processes and Survival Models)

• Statistics

• Extended Linear Models

• Time Series with Constant Variance

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Modern Actuarial Statistics II (MASModern Actuarial Statistics II (MASModern Actuarial Statistics II (MASModern Actuarial Statistics II (MAS----II)II)II)II)

• Replaces the current CAS Exam 4 requirement, which is typically fulfilled by most candidates through completion of SOA Exam C. (Exam C is being discontinued)

• Covers several topics from Exam C, along with new statistics and predictive analytics material

• First offered in the fall of 2018

• Transition rule: candidates with credit for SOA Exam C achieved through an examination administered prior to July 1, 2018 will receive credit for MAS-II

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Modern Actuarial Statistics II (MASModern Actuarial Statistics II (MASModern Actuarial Statistics II (MASModern Actuarial Statistics II (MAS----II)II)II)II)

Topics Covered:

• Introduction to Credibility

• Linear Mixed Models

• Bayesian Analysis and Markov Chain Monte Carlo

• Statistical Learning

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MASMASMASMAS----I and MASI and MASI and MASI and MAS----IIIIIIII

• Four-hour exams, resulting in virtually no net increase in exam hours required for CAS credentials

• Offered every six months as multiple-choice paper-and-pencil exams

• Offered in the same general windows in the spring and fall in which other CAS exams are offered

• Complete syllabi available on CAS website

• Sample questions and answers for the two new exams will be published well in advance of their first offerings

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2018 CAS Syllabus to Reach ACAS2018 CAS Syllabus to Reach ACAS2018 CAS Syllabus to Reach ACAS2018 CAS Syllabus to Reach ACASRequired CAS

Learning ObjectivesMet Through Other Exams

CAS Exams

– 1 – Probability

– 2 – Financial Mathematics

– 3F – Investment and Financial Markets

– Exam MAS I – Modern

Actuarial Statistics I

– Exam MAS II – Modern

Actuarial Statistics II

– Exam 5 – Basic Techniques for Ratemaking and Estimating

Claim Liabilities

– Exam 6 – Regulation and Financial Reporting (Nation

Specific)

– Actuarial Institute of Chinese Taipei,

China Association of Actuaries,

Canada, and United States

Basic Basic Basic Basic Education: Strategic FocusEducation: Strategic FocusEducation: Strategic FocusEducation: Strategic Focus

• Determining the basic education for the actuary of the future and adjusting the CAS system accordingly

• Reviewing foundational requirements

• Transformation of content delivery and validation methods– Add more integrative forms of testing on Fellowship examinations

– Consider whether certain Associate-level educational content could be effectively delivered through a Massive Open Online Course

– Increase use of computer-based testing

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Basic Basic Basic Basic Education: In Education: In Education: In Education: In SummarySummarySummarySummary

• Constantly being adapted and refreshed– Emergence of new P&C risks and coverages

– New era of Big Data and Big Data methods

– Evolving expectations on the part of students on how educational content is delivered and tested

– Activities of other organizations

• Curriculum reflects experience of practicing actuaries who understand what is required to practice in casualty actuarial field

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Basic Basic Basic Basic Education: In Education: In Education: In Education: In SummarySummarySummarySummary

• Is the most robust and comprehensive framework for training property/casualty actuaries

• Is a proven commodity and highly valued around the world by employers and other stakeholders

• Will continue to evolve to meet the needs of employers and other stakeholders

• Will continue to focus on the breadth and depth of materials covered in our higher-level examinations

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Introducing The CAS InstituteIntroducing The CAS InstituteIntroducing The CAS InstituteIntroducing The CAS Institute

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What is The CAS Institute?What is The CAS Institute?What is The CAS Institute?What is The CAS Institute?• Subsidiary of the Casualty Actuarial Society

• Provides specialist credentials and resources for quantitative professionals in selected areas, such as:

Predictive Analytics / Data

Science

Catastrophe Modeling

Capital Modeling/ ORSA analysis

Quantitative Reinsurance

Analysis

Other analytics and quantitative

specialties

Initial Offerings: Planned Offerings:

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Why was The CAS Institute Created?Why was The CAS Institute Created?Why was The CAS Institute Created?Why was The CAS Institute Created?

To meet market needs for quantitative specialists

To serve professionals in areas where quantitative skills and actuarial skills overlap or are complementary

To allow the CAS to continue credentialing property and casualty actuaries and to address needs of broader audiences

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CSPACSPACSPACSPA Certified Specialist in Predictive Certified Specialist in Predictive Certified Specialist in Predictive Certified Specialist in Predictive Analytics Analytics Analytics Analytics ---- Credential RequirementsCredential RequirementsCredential RequirementsCredential Requirements

1.P&C Insurance Fundamentals– Extracts from CAS Online Courses 1 & 2; extracts from Intro to

Ratemaking / Reserving (CAS Exam 5)

– One Online Module – similar to CAS Online Courses 1 and 2

– Exam through The Institutes (multiple choice, short answer)

2.Data Concepts, Tools & Analysis – with P&C Applications– Exam through The Institutes (multiple choice, short answer)

3.Predictive Modeling – Methods and Techniques– Computer-Based exam – ability to use software

4.Case Study Project: P&C Predictive Modeling Application– Individual project; not an exam or online module

– Assessed by Project Review Panel

5.Online Course on Ethics and Professionalism

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What Value will The CAS Institute What Value will The CAS Institute What Value will The CAS Institute What Value will The CAS Institute Credentials Provide?Credentials Provide?Credentials Provide?Credentials Provide?

Provides recognition of expertise and knowledge

Demonstrates knowledge of practical applications

Set credential-holders apart from others

Advances both knowledge and practical skills

Prepares a specialist for additional job duties

Helps advance and enhance a specialist’s career

Provides a practice community to meet colleagues

The CAS Institute The CAS Institute The CAS Institute The CAS Institute –––– TimelineTimelineTimelineTimeline

• When will the CSPA courses and exams be offered?

Oct 2016

First course is open: Property-Casualty Insurance

Fundamentals

Online module and study

materials now available

Nov 2016

iCAS Membership opened and includes a Practice

Community for Predictive Analytics and Data Science in

P&C Insurance

Experienced Practitioner

Pathway also opened in

Nov

2017

2nd course opens March

Materials for 3rd exam –Apr/May

Projects open Oct/Nov

1st exam – Jan/Feb

2nd exam – July/Aug

3rd exam – July/Aug

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Questions and Discussion