Actuaries uniquely positioned to assist during COVID-19

The Actuaries Institute recently announced Jennifer Lang as the recipient of their Actuary of the Year Award for her work in leading the Institute's Covid-19 response.

She is currently a non-executive director at Pacific Life Re Australia and an expert consultant to UniSuper's insurance committee. Her distinguished career includes stints as chief actuary at CommInsure, NAB Wealth and Commonwealth Bank.

As part of the Actuaries Institute Covid 19 Working Group she has been exploring the profession's unique ability to assist with some of the risks posed by the pandemic and other challenges, such as climate change.

COVID-19 work

In April she put a call out for volunteers for the Working Group and ended up with 80 responses.

"Early on the Actuaries Institute realised that this is a big challenge for the actuarial profession so we put together a working group from across the profession," she says

That working group focuses on providing information to actuaries and the industries they support, and also the role the profession can play in supporting the community.

"We thought quite carefully about what actuaries bring to the table," Lang explains.

Actuaries have skills in scenario testing and modelling and are very familiar with risk management and stress testing.

The group put together a lot of specific briefing notes for actuaries to read and consider as they supported the companies in the industries they work in. They also provided webinars around important topics.

"One of the [webinars] that went really well was one we did for the Australian Institute of Company Directors (AICD) for directors of insurance companies," Lang says.

Aside from the obvious risks to life insurance companies of COVID-19, this webinar also explored the less apparent long-term mental health impacts of the ongoing economic contraction.

"One of the things I've really enjoyed about working with this group is there are a lot of actuaries who really want to make sure we are helping the community as best we can."

Climate change

Lang is also a member of the Actuaries Institute's Climate Change Working Group and has been working on an information note for appointed actuaries on climate change.

"Appointed actuaries have a requirement to comment on the risk management framework of the companies they are appointed to," she said.

And that now includes a consideration of a company's climate change risk management policy, which must also consider how climate change will impact businesses and also factors such as 'transition risk'.

"The transition risk from moving an economy from where it has been to a more carbon neutral economy, those transition risks have quite a lot of unexpected effects," Lang said.

Actuaries need to think about whether the company they are supporting has a framework for investment risk, which includes not only divestment but also exposure to potential growth areas.

"It's just helping people thinking through what those risks might be [and] is part of helping the actuarial profession to be ready for this," Lang said.