In a fascinating article in The Actuary Magazine, IFRS specialist Devadeep Gupta, FIAI, CERA, traces the origin of the science back from ancient Babylon, Greece and Rome, through to 18th-century England, when the profession was defined, the term ‘actuary’ was coined, and the first actuarial appointment, at the National Debt Office, was made in 1821.
Since then, the profession has evolved considerably. Traditionally associated with expertise in technical analysis, quantitative modelling and ensuring long-term financial resilience, today’s actuaries are increasingly required to act more as strategic advisers, with their decisions influencing risk, capital and growth strategies across organisations. This transition has been driven by advances in technology, changes in regulations and shifting business expectations that reflect today’s challenging environment. Here, we look at how and why the actuary’s role has changed and the increasing expectations on the profession.
Historically, the actuarial role has been one of data analysis, financial risk assessment and providing informed advice to organisations to enable them to make better financial decisions in periods of uncertainty. This technical expertise remains important to insurance organisations of all sizes. However, they’re now placing increasing emphasis on how those insights can be applied.
With advances in data infrastructure and automation reducing the time actuaries spend on manual processes, they’re becoming increasingly involved in decision-making, rather than offering their opinions at the end of procedures. A recent article in The Actuarial Post noted that ‘the actuary is no longer the end of the analytical chain but a partner in live decision-making, helping underwriters and business leaders navigate uncertainty’, meaning that organisations now expect actuaries to contribute their insight into both underwriting and business strategy in real time.
This reflects a move away from actuarial work as a retrospective analytical function to a more forward-looking advisory role, embedded within business strategy, and, as a result, actuaries are now expected to interpret possible future outcomes and advise on what their employers should do in response.
The main driver of this reallocation of focus is technology. AI, machine learning and cloud-based analytics have reduced the time that routine processes take and fundamentally altered how the role is defined, allowing more time for advisory and interpretive work and requiring actuaries to adapt both their approach and their skills.
However, this redefinition highlights rather than diminishes the continued need for technical expertise. Within the profession, AI is augmenting, not replacing, judgment, offering a deeper understanding of model limitations, uncertainty, and assumptions, and enhancing the relevance of its findings. Last year, the International Actuarial Association published a report from its Artificial Intelligence Task Force, which stressed that actuaries who use AI also play an integral role in ‘identifying and managing’ its risks and ensuring it is used responsibly. This approach positions actuaries as key to governance, explainability and ethical use.
As the profession's technical capabilities expand, so does its influence in areas that were previously only adjacent to it. Actuaries are increasingly required to consider a wider set of challenges, such as capital allocation and risk management. One such area is climate risk, which requires not only traditional long-term modelling and scenario analysis, but also research into factors such as environmental variables that affect mortality and risk models, and into how these can improve forecasting accuracy.
Actuaries now have a far broader remit, one that underpins finance organisations’ requirements for increasing support in areas such as regulatory change and economic uncertainty. The profession is now positioned to inform strategic decision-making, governance structures and technical modelling to support both growth and resilience.
In order to fullfill these changing expectations, the nature of the role of the actuary is changing. Technical proficiency remains essential but there is now increasing emphasis on:
Commercial awareness – so that they can inform how actuarial insights link to business performance
Communication – to be able to explain complexity, uncertainty and model outputs to non-technical colleagues
Cooperation – to ensure that they can work alongside engineers, data scientists and business leaders
Digital fluency – so that they can utilise emerging technologies such as AI tools and data platforms and understand the risks they pose
Critical thinking – to effectively assess model risk and data quality.
These new skills represent a shift away from how accurate models are and towards the effective generation, interpretation and application of insights.
As the profession evolves to encompass more strategic decision-making processes, its responsibilities increase accordingly. Models have become more sophisticated and integrated into business operations so, so therefore, governance has become increasingly important too. Actuaries must now address questions about transparency, bias, and explainability, which are becoming increasingly prominent and relevant.
Actuaries already have the skills and experience to address these challenges directly. Their professional training emphasises discipline, accountability and judgment, qualities essential to ensuring that models are explainable and decisions are defensible. And in high-stakes environments, where advanced analytics and automated systems inform decisions, these attributes are particularly desirable. An International Actuarial Association Artificial Intelligence Task Force report of 2024 noted that actuaries who master new technologies will become not only ‘stewards of risk’ but also ‘visionary strategists’, driving innovation, shaping business outcomes and safeguarding societal trust in an AI-powered world. Actuarial oversight has now become essential to responsible innovation, enabling organisations to meet frequently shifting regulatory expectations.
Employers must now take practical steps to ensure that the evolution of the actuary’s role becomes an opportunity to utilise a valuable in-house resource and provide the insight that they need to inform future strategy.
To fully achieve effective strategic planning, risk management and capital allocation and make full use of the capabilities of their actuarial functions, organisations should:
Integrate actuaries into strategic forward-looking planning processes, not simply have them provide retrospective analysis
Encourage cross-functional collaboration between actuarial, risk, data science, finance and commercial teams
Invest in technology that frees up time spent on manual workloads to focus on data accessibility
Provide ongoing professional development support such as communication and digital skills to complement technical training.
The Institute and Faculty of Actuaries has recognised the changing nature of the actuary’s role and, last year, established its AI, Data Science and Emerging Technologies Practice Board. This emphasises the need for ongoing support through continual professional development to equip its members with the skills and qualifications needed to inform strategic direction.
How actuarial organisations respond to these seismic shifts will define the profession's future. Traditional skills and expertise remain vital but are now a starting point for technological applications that are impacting how actuaries work and how they respond to changing regulatory requirements and organisational expectations.
Actuaries are increasingly required to integrate more deeply into organisations’ structures and to offer higher levels of judgment and strategic insight in direct response to automation. They contribute more to how their employers consider uncertainty, allocate capital and develop growth strategies and are now at the heart of decision-making. This more integrated, more visible and more influential role requires broader skills that combine analytical and strategic insight and will come to characterise the future of the profession.
The actuaries of tomorrow are not simply model builders. They are technical specialists, risk advisers and strategic influencers and they shape outcomes across capital, risk and growth in a rapidly changing insurance landscape.