Navigating a Non-Traditional Actuarial Career: From Insurance to Banking

By Sheng Tseng, FCIA

My early career path

The first phase of my actuarial career should be relatable to most actuaries. I graduated with an actuarial science degree and passed some SOA exams, then joined a large insurance company in their actuarial rotation program.

A few years later I moved to an international actuarial consultancy where I was involved with a number of traditional and non-traditional (mostly investment related) actuarial client projects for several years. I was well into my actuarial career when I made my next move to TD Insurance, where I continue to gain more non-traditional actuarial experience.

Why I transitioned to banking

While I found all my actuarial jobs challenging and fulfilling, it became obvious I needed a change due to professional and personal reasons. Work at the consulting firm slowed down after the business of demutualization (i.e., advising insurers going public) was behind us. As a result, the primary option to get billable hours and career growth was to travel overseas.

Unfortunately, this was not ideal timing since I had a newborn baby at home. And instead of returning to an actuarial role at a large insurance company, I thought this was now a good time to satiate my curiosity for other actuarial career opportunities. Fortunately, at that time, an actuary I know was leaving her non-traditional role at TD Insurance, so I got in touch with her to learn more about the role she was vacating.

This led me to conclude that joining TD Insurance would be a relatively low risk option for me to find out what it would be like working for a bank and then attempt to transition to other roles within.

Challenges I overcame in banking

Adjusting to a different corporate culture is always one of the main challenges of a job change. I could certainly elaborate on a multitude of examples from my experience, but I’ll focus on those that are most likely experienced by actuaries transitioning to banking.

Given the nature of my prior employers (i.e., large insurer and actuarial consultancy) and the roles I held, I had mainly worked with other actuaries or people with experience working with actuaries. But this was no longer the case. As a result, it was clear to me early on that my number one priority was to adjust my communication style and messaging to a more diverse audience. This not only involved avoiding technical language and actuarial terminology, but also tailoring the message to the teams (e.g., risk, product or sales) I was working with.

So, my focus shifted from primarily making sure I produced the right results to dedicating much more effort on the messaging of those results, to ensure that it was digestible and relevant for various non-actuarial audiences.

Another area I had to get up to speed on was the language used by bankers, including within the bank’s insurance business. As most of my colleagues were bankers working there as a development opportunity, everyone assumed that I too would be familiar with banking jargon. Not only was there new terminology, as expected, but sometimes different interpretations of the same word. An example would be when I referred to a five-year bond as short-term in the insurance or pension investment portfolios, which caused some confusion since bankers consider this long-term given that bank balance sheets are much shorter.

The last main change I needed to get comfortable with was that leadership in banking is not made up of actuaries, unlike the previous leadership teams I had worked with. This meant that there were less relevant role models for me to learn from in terms of career path and development, but it did lead me to be more aware of the various additional career paths and the many different ways to progress in the organization.

Advantages of being an actuary in banking

People banking tend to automatically give actuaries a lot of credit in terms of technical competence. While most bankers have never worked with actuaries, they are aware of the reputation actuaries have of being highly technical or quant-type professionals that worked very hard for years to pass a lot of hard professional exams. Therefore, it’s not uncommon for people in banking to say, “Oh you’re an actuary, you must be so good at all that math stuff!”

On a related note, and at the risk of exaggerating, the technical skills of actuaries tend to easily impress a typical banker. One way to make a good impression would be by building large or complex spreadsheet models. One example that comes to mind is when I calculated the impact of interest rate compounding under different interpretations of the law vs. customer contracts. In this case, in order to make sure every potential situation was covered, I actually had to use force of interest in one of my scenarios, something I thought would never come up once I was done with actuarial exams.

Lastly, the most significant advantage of being an actuary in a large bank is the variety of ways to develop professionally. I am very grateful for the chances I had to grow in a wide range of areas, including corporate actuarial for the life insurance business, finance/CFO roles, insurance investment management, pension investment management, home and auto insurance and bank capital management.

Most of these areas require some actuarial expertise and, since there weren’t many actuaries in banking, I was often offered the opportunity to take on and learn these roles.

Looking back, I am glad I transitioned to a less traditional career in banking. Thanks to the experiences I shared above, along with the many structured professional development opportunities offered to bank employees, I was able to develop and gain a versatile set of professional skills.

Final advice for those seeking to follow this career path

For those interested in working in banking, it may be worthwhile to have a sense of adventure and take some risks when it comes to your career. Like the conventional thinking in the investment field, larger rewards tend to require some risk taking. It has paid off for me, as it has for many actuaries I know, having taken a less conventional actuarial career path.

This article reflects the opinion of the author and does not represent an official statement of the CIA.

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