Only 458 insurance actuaries in India, need at least 1,200: IRDA Chief

The number of full-fledged insurance actuaries in India grew by just 19 in 2020 compared to the last year. There are only 458 actuaries compared to 439 in 2019, says IRDA Chief Subhash C. Khuntia as he sheds light on the growing requirement of them not just in the insurance industry but also in banking and other financial fields.

"At present we only have 458 full-fledged actuaries, 165 associates and 7,500 student members. These figures need to go up considering the number of insurance companies and the size of insurance business, which is 1.7 per cent of the global industry," says Khuntia.

"Globally, we have 60,000 actuaries. We should aspire to have at least 1,000-1,200 actuaries in India as soon as possible," he adds. He further says that not only the number is inadequate, but there is also a skewed distribution of actuaries in various segments. "India lacks specialised actuaries in the general insurance space."

Actuaries play a big role in pricing the products in such a way that it provides protection to public at large and takes care of solvency of the insurance company.

 "Actuaries now have a large role to play in calculating the effects of uncertain events like climate change and pandemics like covid in designing appropriate products and pricing it in such a way that it balances the interests of policyholders and insurance companies both," says Khuntia.

The IRDA Chief highlighted lack of awareness around actuarial roles and how new opportunities are opening up in the field. "We are moving to use and file system from the file and use system. We have already started it in some segments under sandbox regulations. As we go further, we need actuaries to play a bigger role so that we have lesser oversight to do."

The implementation of International Financial Reporting Standard 17 (IFRS 17) in insurance will also require more actuaries, the process for which has already started.

Besides, as human longevity increases, the demand for innovation in annuities is building. "Areas like superannuation and annuities are ripe for innovation. People need financial protection in old age. How to develop interesting products in annuities is our key focus area. Actuaries can help us design standard annuity products and index-linked insurance products. A committee of actuaries is already working on index-linked products. The report is almost ready," he says.

IRDA Chief was speaking at Virtual Actuarial Conclave 2021.

Subhendu Kumar Bal, President, Institute of Actuaries of India says the institute is taking initiatives to increase the number of actuaries and student members in coming years. "The number of fully-qualified actuaries is low because actuarial science courses are time-consuming. However, Institute has started with coaching /counselling sessions which has immensely helped students qualify the subject much faster," says Bal who also serves as Chief Actuary & Chief Risk Officer at SBI Life Insurance Company.

"In other countries, there is existence of Government Actuary Department to help the government for the creation and pricing of different benefits for the public. In India, we are in the discussion with DFS for the same," he adds.

Also read: Life insurance sector sees 21% growth in Feb as financial year end looms