What Does Actuary Mean?
An actuary is a professional statistician who calculates the risks associated with insurance coverage and the likelihood that claims will be filed or that benefits will have to be paid out. Using relevant statistical data, actuaries also compute dividends and decide premium rates.
Insuranceopedia Explains Actuary
Actuaries need expertise in mathematics, statistics, and economics to fulfill their responsibility of evaluating risks and returns associated with each insurance product offered. Crucial to an insurance company's operation and profitability, they help ensure premiums are offered at a rate that is not only competitive but also enough to cover the risks of the specific coverage offered. If the rate is set too high, then potential customers may not want to purchase policies. However, if premium rates are too low, then the insurance company may not be able to cover all the claims policyholders file.