ProfessionNews
12 October 2008 www.the-actuary.org.uk
Actuaries at large
Faculty president Ronnie Bowie and former Faculty
president Stewart Ritchie took part, alongside other
professional bodies, in a procession from the City
Chambers to St Giles Cathedral to mark the 62nd
Edinburgh International Festival on 10 August.
Merger survey and vote
analysis is published
The analysis of the Faculty consultation
survey and the Institute in-principle vote,
on a proposed merger between the Faculty
and the Institute, was published in the
members section of the Profession's website
on 2 September.
The analysis and comments made to the
survey and the vote, is available at www.
actuaries.org.uk/members/merger_discussion.
Access is restricted to members of the
Faculty and the Institute.
Faculty Council met on 27 August
and Institute Council met on 29 August
to consider, separately, the outcome of,
respectively, the survey and the vote. The
Councils will consider the outcome at the
next meeting of the Joint Councils on
19 September.
If you would like to share your views
about the proposed merger, please visit the
Profession's discussion board at kan.actuaries.
org.uk/mergerdiscussion/Wiki%20Pages/
Home%20Page.aspx
data to derive statistically justifiable
premiums for all ages, particularly for
groups with unusual insurance needs, or
small customer groups.
He said: "If legislation requiring actuarial
justification of rates was introduced, some
companies, particularly new insurers, would
find themselves in the difficult position of
having by law to quote actuarially justifiable
premiums, yet having insufficient data to do
so on a statistical basis."
These issues would be particularly
problematic if insurers were required to
provide insurance quotations for all age
groups, which is also currently being debated.
"Few insurers have, for example,
extensive experience of insuring 80-
year-olds taking skiing holidays, or
18-year-olds driving Ferraris -- at present
the insurance needs of such customers
are met by specialist companies who
use specialist underwriting judgment
to set prices, rather than statistical
approaches," he said.
The paper also discusses why premiums
might not in any case be directly
proportional to the expected cost of
claims. These include the use of fixed
monetary loadings reflecting the expense
of administering the policy, and marketing
activity which directly or indirectly results
in commercial discounts being offered for
different age groups.
The Profession has called for a more
in-depth exploration of the legislation's
potential consequences. The paper's authors
are members of the Profession who are part
of HM Treasury's working group looking at
age discrimination in financial services, to
feed into the Equality Bill, which is likely to
be published in the autumn.
Staple Inn forum focuses on micro-insurance
Micro-insurance
for people living
in poverty in
Indian slums was
the topic at a
recent forum at
Staple Inn. The
forum aimed to
generate interest
among actuaries
about working
in the field and
to promote an
understanding
of the nature of
micro-insurance.
Uplift Health
Mutual Fund (HMF) programme manager Eamon Kelly led the forum and delivered a
presentation on his work in Pune, India. HMF is a member-owned health micro-insurance
programme that operates in poverty-stricken areas of Pune to provide health services and
insurance cover for more than 40 000 members.
Mr Kelly, an associate actuary of the Institute of Actuaries of Australia, discussed the
challenges of delivering services to people living in poverty, micro-insurance in India, and
the role for actuaries and actuarial challenges in this area.
MagdalenaChoroszy
The Profession issued a warning about
the possible practical consequences of the
proposed Equality Bill on general insurance to
the Minister for Women and Equality, Harriet
Harman, in August. In the paper entitled The
Equality Bill -- Age Discrimination in General
Insurance -- Commentary from the Actuarial
Profession, the Profession expressed concerns
the changes were unworkable.
The paper responded to the Rt Hon
Harriet Harman's statement to the House
of Commons on the UK Equality Bill on 26
June. The Profession's main concern relates
to the potential requirement for insurance
companies to provide actuarial justification
for insurance premiums that differ by age.
The co-author of the paper, Duncan
Anderson, said individual insurance
companies would not all have enough
Warning issued on Equality Bill

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