Excel for Actuaries
Actuarial Science involves complex calculations as it deals with large figures in the form of premiums or pension payouts and also because it plays with mathematical theories including probability, statistics and so on.
Microsoft Excel has in more recent years helped actuaries to reduce their job complexity in terms of time, strain and so on, factors which are associated with complicated calculations. As a result Excel for Actuaries is becoming an increasingly important training session.
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There are some spreadsheets which have been specifically designed for actuarial purposes – for example- Transitions Summary, Chain Ladder Reserving Calculations (used in general insurance business), Claims Development (also used in general insurance business), Linear Models and Stochastic Reserving.
In today’s world, most actuaries need to know how to make the best use of computer programmes such as Microsoft Excel in order to make their work easier and more enjoyable and also to get the most accurate results. Hence anyone wishing to be an actuary needs to be proficient in Microsoft Excel.
Actuaries can make good use of Microsoft Excel in their actuarial work as one of many tools in their toolkit for actuarial based calculations. Learning Excel is often fundamental to the first few years of an actuarial career and even in later years as an actuary when the actuary will be checking, peer reviewing and signing off on numbers.
From an actuarial industry perspective the key Excel skills an employer will want from actuarial students will include
- basic formulae creation/manipulation especially vlookups;
- data manipulation for example filtering and sorting;
- cashflow modelling and discounting;
- possibly VBA;
- macros to run individual calculations, transfer values and so on
- pivot tables for data summaries and analysis.