An Update from the Casualty Actuarial Society Presented by: Kendra Felisky Casualty Actuaries in Europe Zurich 9 June 2017

Agenda Opening Remarks Basic Education Continuing Education CAS Research Priorities The CAS Institute Other Topics Questions and Discussion

Why Does the CAS Exist? To foster a vibrant, global community of casualty actuaries To assure that members have the necessary analytical skills and expertise to deliver effective advice and bring value to society Empowering business and government to make better risk decisions Assuring the soundness of mechanisms used to finance risks To promote and protect the “brand” embodied in its professional designations

Basic Education Strategy 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

Current 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 ACAS Required CAS Learning Objectives Met Through Other Exams CAS Exams 1 – Probability 2 – Financial Mathematics 3F – Models for Financial Economics 4 – Construction and Evaluation of Actuarial Models Requirements typically fulfilled by passing the Society of Actuaries' Exams P, FM, MFE, and C, respectively 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 Waivers Waivers granted for exams offered by the following organizations: 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 FCAS 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 Exams (MAS) Effective in 2018 Replaces 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

Modern Actuarial Statistics I and II 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

Modern Actuarial Statistics I (MAS-I) 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: Exam S = MAS-I Topics Covered: Probability Models (Stochastic Processes and Survival Models) Statistics Extended Linear Models Time Series with Constant Variance

Modern Actuarial Statistics II (MAS-II) Replaces current CAS Exam 4 requirement, which is typically fulfilled 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: SOA Exam C = MAS-II Topics Covered: Introduction to Credibility Linear Mixed Models Bayesian Analysis and Markov Chain Monte Carlo Statistical Learning

2018 CAS Syllabus to Reach ACAS Required CAS Learning Objectives Met 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

CAS Basic Education: In Summary 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 Most robust and comprehensive framework for training property/casualty actuaries Proven commodity and highly-valued around the world by employers and other stakeholders Adaptive to meet the future needs of employers and other stakeholders

Continuing Education Strategy Streaming/online interactive programs Cost-effective continuing education opportunities Partnerships with other organizations that work closely with CAS members (e.g., CPCU) Survey of members and “friends” regarding CE needs, most important topics, and preferred delivery methods

2017 Continuing Education Programs CAS Annual & Spring Meetings Underwriting Collaboration Seminar Ratemaking and Product Management Seminar ERM Symposium Seminar on Reinsurance Casualty Loss Reserve Seminar Actuary of Tomorrow Seminar Limited Attendance Seminars (e.g., R Boot Camp) Regional Affiliate Meetings Monthly Webinars (some complimentary) UCAS: On-demand session recordings and interactive online courses

Research Strategy Five Strategic Research Topics Predictive modeling and data analytics Modeling, more broadly Reserving methods, processes, validation Economic scenarios and stress-testing Cyber risk All of our research should be cutting edge, with practical application

Research Strategy Approaches to achieve research goals: Variance papers Calls for papers (with prizes) Funded research papers Papers by volunteer research committees and working parties Publication of papers by academics Library of Excel templates

Fostering a Global Community Asia Region Casualty Actuaries (ARECA), the newest CAS Regional Affiliate 2016 Seminars in Singapore, Shanghai, Beijing 2016 Joint Seminar with Thai GI Association Seminars in Malaysia (joint with Australia and Malaysia organizations) 2015 Ratemaking Seminar 2016 Motor Insurance Seminar Mutual Recognition Agreement with South Africa and India; Preliminary Exam Waivers with China

Introducing The CAS Institute TheCASInstitute.org

What is The CAS Institute? Subsidiary of the Casualty Actuarial Society Provides specialist credentials and resources for quantitative professionals in selected areas, such as: Initial Offerings: Planned Offerings: Predictive Analytics / Data Science Catastrophe Modeling Capital Modeling / ORSA analysis Quantitative Reinsurance Analysis Other analytics and quantitative specialties

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

9/14/2012 CSPA Certified Specialist in Predictive Analytics - Credential Requirements 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) Data Concepts, Tools & Analysis – with P&C Applications Predictive Modeling – Methods and Techniques Computer-Based exam – ability to use software Case Study Project: P&C Predictive Modeling Application Individual project; not an exam or online module Assessed by Project Review Panel Online Course on Ethics and Professionalism

The CAS Institute – Timeline When will the CSPA courses and exams be offered? Oct 2016 First course opened: 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 opened March Materials for 3rd exam – Apr/May Projects open Oct/Nov 1st exam – Jan/Feb 2nd exam – July/Aug 3rd exam – July/Aug

Experienced Practitioner Pathway For professionals who have been practicing in the field of insurance predictive analytics and modeling for a minimum of five years. Application process; does not require completion of courses or exams. Candidates must demonstrate experience and expertise in: P/C Insurance Data Management and Analysis Statistical and Predictive Modeling and Machine Learning Predictive Modeling Project

What Value will The CAS Institute Credentials Provide? Provides recognition of expertise, knowledge, skills, and practical applications Set credential-holders apart from others Provides a practice community to meet colleagues Helps advance and enhance a specialist’s career

iCAS Membership and Practice Communities Open membership – credential not required iCAS members automatically enrolled in 1st practice community for Predictive Analytics and Data Science Membership required for: Obtaining waivers for credential requirements Registering for predictive modeling exam or case study project Applying for CSPA through Experienced Practitioner Pathway Annual dues: $250 2017 dues waived – Charter Member join by 9/30/17 Members agree to follow the iCAS Ethical Principles for Professionals 

Questions and Discussion