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Actuarial acronyms and notation

Created: 2022-02-10 | Last update: 2024-11-16

Embarking on a career as a junior actuary within an insurance company is an exciting but challenging journey. Amidst the complexities of the field, one of your initial hurdles will be acquainting yourself with the multitude of acronyms that permeate actuarial discussions and documents.

In this comprehensive guide, we've diligently compiled an extensive list of these actuarial acronyms, making it easier for you to navigate the intricate world of insurance and risk assessment.

Actuarial acronyms

AcronymFull name
CSMContractual Service Margin
EEVEuropean Embedded Value
EIOPAEuropean Insurance and Occupational Pensions Authority
ESGEconomic Scenario Generator
EVEmbedded Value …
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Embedded Value

Created: 2022-02-04 | Last update: 2022-02-04

If you are an actuary, it is likely that you will come across the term Embedded Value (EV). Embedded Value is one of the reporting regimes - the set of rules of how to perform actuarial modelling and reporting.

In this post, we will present a short history of Embedded Value, its aim and main components. Before we start, it is worth mentioning that Embedded Value is not required by any regulators. The insurance companies are not obliged to publish results of EV (unlike for example Solvency II). …

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Actuarial risks

Created: 2022-01-22 | Last update: 2022-01-22

An actuary can be perceived as a superhero who helps protecting policyholders against risks. In this post, we will go over the risks that insurance companies face.

The main risks groups are: insurance, market and operational risks.

Insurance risks

Insurance risks are the risks bonded to leading an insurance business. The most important insurance risks are underwriting risks.

  • Mortality risk - the risk that more policyholders die than expected (when death is the insured event). The risk may materialise e.g. due to incorrect assumptions used in the model.
  • Longevity risk - the risk …
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Proxy model for actuarial valuation

Created: 2022-01-15 | Last update: 2022-01-15

A proxy model is the simplification of the full valuation model. It should be as close as possible to the full results. The proxy model is faster than the full model.

Application

The proxy model is likely to be used when the company has its own Internal Model and uses it instead of the Standard Formula. In that case, the company needs much more valuation results. For example, the company might need results for stresses on levels other than 1-in-200, stresses on pairs of risks, etc.

The proxy model might vary depending on the number of risks that it encompasses: …

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Solvency II in a nutshell

Created: 2022-01-01 | Last update: 2024-12-07

When you become an actuary, you hear the term “Solvency II” a lot. In this post we will go over basics of this actuarial reporting framework.

List of content:

  1. Basics of Solvency II
  2. Balance Sheet

Basics of Solvency II

  • Solvency - the "Solvency" in "Solvency II" emphasises that the focus of this regime is to keep the insurance companies solvent. The regime requires that each insurance company has enough money to pay its …
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