This month we sat down with David Hare, President of the Institute and Faculty of Actuaries, and a Partner at Deloitte, to talk to him about his article in this month's edition of The Actuary.

In this month's The Actuary, you speak about the importance of actuaries staying up-to-date with technology and current issues. Why is that so important?

In the past actuaries were seen as key thinkers in life insurance companies, and that is still the case when it's all about risk. However, nowadays a lot of insurance companies are more focused on investment opportunities for customers, and there are a lot of other people in addition to actuaries who have good ideas in that space. One of the ways of increasing relevance for actuaries is to embrace all the other issues which are on the agenda of senior management, and use our analysis and problem solving skills, as well as creativity and imagination, to actually help companies create value.

How does data analytics help actuaries do their jobs better?

Through data analytics you're getting data to help you to better relate to existing customers, target new customers and understand your risk better and more cheaply than other models. It can also be used to improve the underwriting process and make it more efficient.

Throughout your career, how have you seen the use of data analytics change the actuarial profession?

About ten years ago, the next big use of data was for actuaries to plot risk distributions and look at percentiles. That required understanding what data is out there to try to model the past to predict the future. Now leading companies in the UK are using the heavy lifting data technology to look at customer data in new ways to understand how to best meet their needs. For example, how to use external data with internal data to develop next best action. Or voice recognition technology to flag whether there are issues with products by tracking certain words coming up during customer calls.

Do you think that actuaries are embracing enough of new technology?

What I'm hearing is that firms want to embrace data analytics, but what I'm worried about is that actuaries will fall behind. Actuaries need to not just keep up with the difficult technical aspects, but keep up-to-date with value adding customer facing issues, clever technology and other things that are coming to the fore. We need to be fully embracing of this otherwise we will not be the business leaders tomorrow.

In your opinion, do you see a discrepancy between information derived from data analytics and putting it into use?

I suspect there is no company that has completely cracked data analytics. If anybody is reading this blog and thinks they are the people, please get in touch with me and I'd be very happy to say I'm wrong!

What I'm hearing from my colleagues and clients, is that there is still a real appetite to see what more can be done and there's probably still an early mover advantage that can be gained from doing this.

What do you think of all the technological advances and the impact they are having on the actuarial profession?

I have been wowed and excited by all of this. Some actuaries are sceptical and ask why they should be involved in data analytics because some don't feel it is complicated enough. But if it's going to add value to firms, actuaries should be part of that. There will be times when they will have to warn against things and will need to have built up the credibility to do that effectively. You get a lot of credibility from being an actuary, but you also get a lot of credibility from helping the business make money and serve customers better, and doing it in a more efficient and controlled way. There is a lot of innovation going on that can help actuaries in all of these things. So if, as an actuary, you're not changing the way you're thinking about your role, then you might be missing a trick.

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