1. The Transformation of the UK Actuarial Profession Or, Remaining Relevant in a Changing World? By Adrian Saunders

2. The Profession in 1980 Not much had changed in 30 years

3. Life Industry With Profits and mutual offices Statutory Roles Status in Management Regulated by DTI, delegated to the GAD Participation in the profession encouraged

4. Examples from Life Industry -1 1974-75 Market crash

5. Changing World 1986-1996

6. Examples from Life Industry -2 Mortgage Endowments

7. Examples from Life Industry -3 The Equitable

8. Examples from Life Industry -4 With Profits Bonds

9. Reviews….The Lost Decade 2001Actuarial Profession’s Corley Report 2001FSA Baird Review -> With Profits Review 2004Penrose Report into Equitable 2006Morris review of Actuarial profession 2007EU Report on Equitable

10. Impact on the Profession Loss of Appointed Actuary Role Losing status within companies (adviser to the Board rather than member of Board) Increasingly technical modeling work replacing exercise of judgment Lack of visibility as public champion

11. Examples from Pensions -1 Schemes in significant surplus –Revenue concerned that companies were sheltering excessive profits within schemes –Finance Act 1986 capped pension fund surpluses and introduced “Contribution Holidays” Government saw an easy fund-raising target: 1997 “Gordon Brown’s Tax Grab” Actuarial profession’s response muted.

12. Examples from Pensions -2 FRS 17 (2001) Introduced realistic costing of pension liabilities –Great work for actuarial consultancies! –Short term volatility for long term liability –Accelerated demise of DB schemes and adversely affected investment policy Actuarial Profession’s response muted (strong differences of opinion amongst Council members)

13. This Debate is Still Going On

14. Where Did This Leave the Profession? The fallout from Equitable damaged the standing of actuaries in management and in the eyes of the public In pensions, the move away from DB reduced opportunities, individuals need increased support Increased regulation replaced freedom and judgment with technical calculation

15. Hope for the Future? New Fields –General Insurance –Risk Management Growing interest in Risk Management and the creation of CRO posts provides an opportunity –If we can rise above super-technical modeling and capture the CRO role by showing how it is relevant in practical ways to companies.

16. A Case Study In The Making?