Insurance Regulatory and Development Authority of India (Irdai) has said insurers should appoint mentor, to increase the supply of appointed actuaries.
Irdai is approving the appointment of actuaries who are fellow members of the IAI (but do not qualify with the relevant experience and / or other requirements), subject to appointment of experienced actuary as mentor.
The regulator said that the Mentor should guide these Appointed Actuaries on day-to-day basis.
“Currently it appears that the mentoring may not be happening as envisage,” said IRDAI. According to the new norms, the Mentor should be a Fellow of Institute of Actuaries of India (IAI). However, fellow from any other Institutes wherein the IAI have mutual recognition agreement will also be considered provided the Actuary declares his/ her intention to obtain Fellowship of IAI within next one year.
The upper age limit for the mentor will be 75 years. The regulator has said that the mentor should have at least 20 years of experience in the Insurance field out of which at least 10 years of experience should be post-qualification.
Here, the purpose for appointment of mentor is to support younger Appointed Actuary who is a Fellow of the Institute of Actuaries of India but does not comply with relevant experience/ other requirements of the Appointed Actuary Regulations. The mentor will be applicable only when AA is full time employee of the company. If the company proposes to appoint AA on Consultancy basis, the Appointed Actuary himself / herself should be able to qualify all the criteria under Appointed Actuary Regulations
The good news is, Insurers have been advised to strengthen the Actuarial function by employing enough Actuarial students. This will help the AA in getting detailed analysis required for performing various statutory duties. In the process, the students will also get practical experience necessary for taking up more responsible positions within the Industry in future.
The above guidelines are effective immediately. The existing arrangements of Appointed Actuaries and Mentors not complying with these guidelines may continue till 30 June 2016. From 1 July 2016, all the appointments of Appointed Actuaries and their Mentors will be in compliance with these guidelines.
According to R M Vishakha, managing director and CEO of IndiaFirst Life Insurance, this arrangement will motivate more youngsters to come on board and gain practical experience.
As part of the actuarial course, the student should mandatorily work as an intern in the actuary department of a company. One has to complete the academic course and prepare for the professional qualification while working. This, say experts, puts a lot of pressure on the students and some of them eventually drop out.
Supporting the concept of mentoring, Saisrinivas Dhulipala, appointed actuary at Bajaj Allianz Life Insurance, said: “Young actuaries would require guidance in handling various issues related to products, solvency, and matters pertaining to liabilities and assets. Having an experienced actuary as mentor will help actuary aspirants to a great extent.”
Irdai approves the appointment of only senior actuaries having relevant experience of at least 10 years, said Sanjeeb Kumar, appointed actuary at Aviva Life Insurance and vice-president at Institute of Actuaries of India.
According to Kumar, there is a shortage of people with 10 years’ experience in life insurance and general insurance actuarial practice. He noted that the actuarial exams have high standards and the success rates are as very low.
According to the new norms, the ‘mentor’ should be a fellow of IAI. Fellows from any other institutes with which IAI has mutual recognition agreement will also be considered, provided the actuary declares his or her intention to obtain an IAI fellowship within one year.“In a few years , we’ll have the needed number of senior actuaries once the recent qualifiers get the requisite work experience,” Kumar added.
Source – Business Standard