The Morris Review SOA Education Redesign September 29, 2005 (Bob Beuerlein, SOA President-Elect) and Stuart Klugman, Former SOA VP-Education

BBC News - March 8, 2004 Ann Berry fears her retirement income will be cut further Ann Berry, 65, a former physiotherapist from West Sussex, should be enjoying her retirement. But as an Equitable Life annuity holder she has seen her £6,000 pension slashed by nearly a quarter in the past two years. "It is very worrying, I did everything the government asked me to do - I saved hard for my retirement," Ann told BBC News Online. "Now my pension is being used by Equitable as a cash cow to pay for promises it couldn't keep."

Ann Berry fears her retirement income will be cut further.

" You can not expect young people to save if they face being let down like we have been," Ann added. Ann counts the cost of putting her faith in the Equitable every day. "I have to forgo life's treats - holidays, meals out even presents for the grandchildren.

History  January Equitable files for cuts  January Court of Appeals disapproves  July Appeal to House of Lords  March Lord Penrose Report  March Morris appointed to review UK actuarial profession  March Final Morris Review Report

Lord Penrose’s Criticisms of the Actuarial Profession  Lack of comprehensive professional standards  Over-reliance on the role of the Appointed Actuary  Lack of scrutiny and audit of actuarial calculations (external/peer review)  Reactive disciplinary procedures  Reluctance to challenge fellow actuarial professionals  Concerns about the Government Actuary

Morris Final Recommendations  Market for Actuarial Services  Actuarial Profession and Regulation  Education and CPD  Actuarial Roles  Standard Setting  Public Interest and Accountability  Scrutiny and Discipline  Government Actuary’s Department

SOA Task Force  Appointed March 2005  Members: Mary Hardy Dan McCarthy Neil Parmenter Walt Rugland Bob Beuerlein (chair)

SOA Task Force Charge  Review Morris Report in light of SOA Strategic Plan  Consider the SOA’s role in: Professionalism Discipline

SOA Task Force Recommendations Strategic Plan – core tenets in agreement with Morris.  Proactive in dealing with business and public interest situations (Professional Community Advancement)  Relevant and non-insular in developing methods (Marketplace Relevance)  Forward-looking educational topics (Knowledge Management)

SOA Task Force Recommendations – Education and Examinations Morris  External oversight  Broader and more timely input into syllabus development  Improved quality of exams and pass mark setting

SOA Task Force Recommendations – Education and Examinations Task Force  The 2005 syllabus changes are in the right direction and need to be completed and enhanced.  Establishment of oversight group responsible for E&E/CE process with non-actuarial membership, as necessary.

SOA Task Force Recommendations – Education and Examinations  Periodic incremental changes, not significant infrequent changes.  Consistent updating of educational materials.  Consistency of exam quality and pass mark setting.  Develop business acumen and communication within basic or continuing education.

SOA Task Force Recommendations – Education and examinations  Additional learning assessment methods.  Reduce average age of new FSA from 33 to 30 by year  Use technology and other means to reduce physical travel requirements.

SOA Task Force Recommendations – E&E progress and proposals  Committee oversight is being reviewed, in particular regarding the link between E and E.  A process for encouraging and adopting alternative and new references is being drafted. We cannot wait 20 years between updates of life contingencies material.  We continue to improve our understanding of learning outcomes and how to relate them to examinations.

SOA Task Force Recommendations – E&E progress and proposals  Some business acumen and communication skills will part of the new capstone module, but mostly this will come through CE, some of which is already being offered.  Learning assessment is being done by other than traditional examinations through the Fundamentals of Actuarial Practice and Fellowship modules.

SOA Task Force Recommendations – E&E progress and proposals  Travel time reduction was a goal of the 2005 changes. It remains to be seen how effective they will be. We also need to be aware there is not universal support from employers.  Adapting technology to our system has been difficult. Our transition to computer based testing for the first exam has been rocky. This is partly due to the high standards set by us and the high expectations of candidates.

SOA Task Force Recommendations – Broadening Actuarial Education Morris  Work with universities and employers to develop new education strategies.  Explore alternatives to reduce travel time and lead to more non-traditional positions.  Accredit universities and allow exemptions.

SOA Task Force Recommendations – Broadening Actuarial Education Task Force  Current SOA Task Forces and Accreditation and Alternative Routes be charged with developing recommendations.  Focus on university-based alternatives, travel time implications, non-traditional opportunities, research, and work-based skills acquisition.

SOA Task Force Recommendations – Broadening Actuarial Education  Include broad representation, including academics, employers, and non-actuaries.  A separate group should focus on enhancing research and experience studies with an emphasis on communicating results to actuaries, employers, regulators, and the general public.

SOA Task Force Recommendations – Progress on broadening education  Accreditation Task force chaired by Warren Luckner will have a report for the SOA Board’s November meeting. Current goal is to provide useful information for prospective students and employers. Ultimate goal is to be key step in an alternative route.

SOA Task Force Recommendations – Progress on broadening education  Alternative routes Task Force chaired by Howard Bolnick will begin work once accreditation program is finalized. Given prior lack of enthusiasm by SOA members, a strong case for its need must be made with input from all constituents.

SOA Task Force Recommendations – Progress on broadening education  Research & Experience Studies Enhanced research and experience study initiatives. Effective communications of results to end- users. Current work has focused on practical papers journal.

SOA Task Force Recommendations – Continuing Education Morris  External oversight.  Clarification of objectives.  Increased quantity and quality.  Linkage with basic education.  Assure that it is up-to-date and relevant.

SOA Task Force Recommendations – Continuing Education Task Force  Board to consider CE requirements for all SOA members.  Work with AAA and CIA.  Consider enhancing distance-learning opportunities.  Determine proper role in developing business acumen and communication skills.  Be cost and time efficient.

SOA Task Force Recommendations – Professionalism and Discipline Morris  Issues too lengthy to discuss here.  North American processes are in much better shape.

SOA Task Force Recommendations – Professionalism and Discipline Task Force  Re-establish Professionalism Committee Liaison to AAA & CIA. FAC & APC and SOA program oversight. User-friendly system, encourage self- regulation. Focus on transparency.

SOA Task Force Recommendations – Professionalism and Discipline  SOA Discipline committee continues to have responsibility only for handling issues presented by the ABCD or CIA to the SOA. Independence is paramount.

Other Organizations Reviews underway by: CAS CIA AAA – Critical Review of the U.S. Actuarial Profession Task Force, chaired by Fred Kilbourne, Terri Vaughan is a member.  Collaboration of organizations