This month we have the pleasure of interviewing Dr. Rajesh Dalmia. Rajesh is a partner at EY Actuarial Services, one of the big four consulting firms in India. He has significant experience in insurance consulting and has worked on projects with almost all the large insurers in the private sector in India in his long career. He was also the president of the Indian actuarial profession from 2014-2016. By qualification he is an actuary and also holds a doctorate from The Indian Institute of Management Bangalore.
ACTEX Learning (AL): How many practicing actuaries do you have in India?
Rajesh Dalmia (RD): It would be very difficult to answer this question today because the Institute has not implemented a Certificate of Practice for all the practicing actuaries. However, given that there are more than 55 insurance companies in India and more than 20 consulting firms, I would say that there are at least 100 practicing actuaries in the country.
(AL): What is the word for actuary in a local language?
(RD): In Hindi it is beemakank or बीमाकंक.
(AL): When was actuarial science first introduced?
(RD): The society was established in 1944 and the first examination was conducted in the year 1989. Initially, most Indian Actuaries were members of the UK body, given the British Raj in India. The cost of books was quite high and knowledge was not as free as it is today. Founding member realized that joining together would help them to learn from one other. It was a small group of actuaries -- Mr. Salunkhe, Saha, Diwan and Pandit, among others -- a group of like-minded people. Life Insurance Corporation of India (LIC) agreed to provide the support to the budding society and these actuaries from LIC decided to form a society to help all members. The idea was to share knowledge and build a library to help build knowledge.
It was much later that the society decided to start its own examinations (mainly to reduce the costs for students) and then later developed its own conduct standards. Prior to 1989, membership was based on examinations from other actuarial bodies. Globally, the UK has the oldest professional body which started in July 1848.
(AL): What is your favorite part about being an actuary?
(RD): Making predictions about the future based on what is embedded in the historical data and our understanding about the future. This is different than astrology which goes into predicting future based on movement of the stars. Unlike astrology, we do not predict individual futures but the future for a homogeneous group.
(AL): Can you share an interesting anecdote from your career as an actuary?
(RD): When I was writing exams, I met a person who was also writing an exam and he said the moment I qualify as actuary I would get jobs paying more than 2 crores (Twenty million rupees, or approximately US$300,000). Well, even today I have not seen that figure as a salary and it has been more than ten years since I qualified. The level of hype and myth around this career in India is mind-boggling.
(AL): What are some of the highlights of the history of the actuarial profession in India?
(RD): It is really amazing that we had so many actuaries in India when there were strict exchange controls implemented by the Reserve Bank of India (RBI) before the economy was opened up. That the society was formed and run by these actuaries from their personal contribution without any support from government is quite fascinating. It was unthinkable that the Society would have an asset base of a crore (Ten million rupees, or approximately $150,000) and yet today the total asset base is 44 Crore (440 million rupees or approximately 6.6 million dollars). This has been a remarkable journey for the Indian actuarial profession and I hope the journey continues in foreseeable future.
(AL): What are some of the main challenges and projects for actuaries in India over the next 5-10 years?
(RD): Actuaries work in various sectors, and there will be sector-specific challenges. Nevertheless, some broader themes that will impact all of us are big data, internet of things, artificial intelligence, analytics, the low interest rate environment and technological advances.
Nevertheless, with the advent of Solvency II, a risk-based supervisory regime for EU insurers, the role of actuaries in risk departments is increasing in significance. In this regard, the importance of a CERA designation could become more significant in the future.
(AL): Who are the main employers of actuaries?
(RD): Insurance players (direct insurance companies, reinsurance companies, brokers, and consultants), pension consultants, government, data-analytics companies and IT companies.
(AL): What qualifications do you find most important for upcoming actuaries?
(IC): More than any qualification it is the skill set which counts and the following skill sets would be very useful – communications skills, problem-solving skills, programming skills and analytical skills.
(AL): Do the schools in India have actuarial majors, minors, concentrations or do students study on their own or overseas?
(RD): Some of the universities in India have started offering actuarial courses and there are coaching institutes as well. However, many students still prefer studying abroad as one gets exemptions from actuarial examinations from some selected Institutes. One exception to this is the Indian Statistical Institute which has exemptions for six subjects.
(AL): What is the credentialing procedure like for an actuary in India?
(RD): To become a fellow, a person needs to register as a student and pass exams from the Institute. In addition to the exams, the individual must gain three years of experience and complete a professionalism seminar. An alternative route is through Mutual Recognition Agreements. Any fellow members of the IFoA, IAA or CAS can become fellow member of India.
(AL): Are there any noteworthy non-traditional actuarial positions?
(RD): Well there is nothing called a non-traditional actuarial position. However, there are actuaries who are employed in non-traditional positions such as CEO, CRO, CFO, etc.
(AL): What is the reputation of actuaries there?
(RD): There is a high regard in the market for actuaries. However, not everyone has heard of actuaries and hence it is limited to the financial sector only.
(AL): Thank you Rajesh!
Learn more about the Actuarial Society of India.