CIA (e)Bulletin/(e)Bulletin de l'ICA

Canadian Institute of Actuaries/Institut canadien des actuaires

October 2017
Elliott Bauer
D.W. Simpson & Company
Eckler Ltd.
President's Update

By Sharon Giffen, FCIA
CIA President

Traditionally, the September Board meeting is prefaced with an orientation session. This is valuable for the new members of the Board to understand the overarching structure of the CIA and the current challenges facing each of the Head Office departments. Personal introductions among the staff and Board members followed—a bit of fun and frivolity before we got down to a packed agenda. 

The meeting was chock full of discussion on some matters that may affect all Canadian actuaries. We will conduct consultations with members shortly, extending through the winter. I urge each of you to speak up and make your views known during this time. 

Upcoming Consultations

  1. Continuing professional development (CPD) review
    First up for consultation is a proposal on CPD. The Board continues to believe that the public will be best served if it can be certain that a person using the FCIA designation is either CPD compliant or has received a waiver for CPD.
  2. CIA structure
    A change to CIA structure will involve a phased consultation. Ultimately, all members will be asked for input; however, we will start with current and recent volunteers, as they will likely be affected most. This is not yet at the proposal stage, rather it is a trial balloon—we are very open to input and alternative suggestions. I would like to hear from any member who has interest in this topic, especially anyone with experience in organizational design.
  3. Other governance matters
    In the interest of modernizing our governance procedures, a variety of proposals will be made. For the most part, these require changes to bylaws, and thus will require a member vote at the next Annual Meeting.

IFRS 17

Those of you in the insurance business have certainly heard of the upcoming implementation of IFRS 17. Our International Relations Council has been busy on this topic for several years now. This implementation will significantly impact virtually every aspect of actuarial work in insurance. (A quick hint—a premium will not necessarily be revenue in the new world!)

To ensure a broad understanding of the implications of the new rules across not only valuation and financial reporting but also pricing and product design, risk management, asset liability management (ALM), and other work relevant to insurance, we have created an IFRS 17 Steering Committee, ably co-led by Les Rehbeli and Cynthia Potts. Their mandate will be to ensure that all Canadian practices are well informed about IFRS 17, and we are prepared to help insurance leaders deal with the implications to the business.

Regulation of the Use of “Actuary”

It has long been a challenge to us that non-members of the CIA can hold themselves out to be an “actuary”; because the CIA has jurisdiction only over members of the CIA, there is little recourse for us. We will investigate the pros and cons of seeking provincial regulation of the term, acknowledging that the possible lack of consistency and possible provincial government regulation would be less desirable than our current uniform regulatory state. Stay tuned for more.

Partnering with Provincial Pension Regulators

We have agreed to provide input to provincial regulators as they undertake a review of pension regulations. Québec has been first into their review with Ontario following closely. Charles Lemieux and Mathieu Provost will provide input, overseen by Bernard Morency. 

University Accreditation Program (UAP)

The Board received a report and recommendations regarding possible future changes to the UAP. At this time, there is no clear change needed. Consultation will continue, to ensure we have connected with all relevant stakeholders.

Practice Corner

Continuing with an initiative to provide the Board with an overview of the current issues in our major practice areas, we had a lively discussion around the many issues facing pension practitioners today. These valuable updates keep the Board informed regarding all practice areas. 

Regular CIA Business

The Board also received reports in the normal course of business:

  1. Annual report from the Actuarial Standards Oversight Council (ASOC) and the Actuarial Standards Board (ASB);
  2. Appointments to councils;
  3. Financial statements;
  4. Progress on Practice Education Course (PEC) 2.0 (updated PEC to be offered from June 2018 onwards);
  5. MSC updates; and
  6. Head Office activities.

Volunteering

Needless to say, there is a lot going on across our many volunteer groups. To each volunteer, I say “thank you”. And to those who have not yet found their niche to get engaged, I invite you to keep looking—there is something of interest to almost everyone!

If you have a question, please do not hesitate to contact me either at my e-mail address in the online member directory or through the Head Office e-mail address. Happy October!

Sharon Giffen, FCIA, is President of the Canadian Institute of Actuaries.

 
In Focus

By Benoit Miclette, FCIA

The Member Services Council’s (MSC) role in simple terms is to bring to life the Board’s strategies and objectives with respect to public and government initiatives, the promotion of the actuarial profession, and services to the CIA membership. The result is a very broad scope of work which may not appear to fit cohesively together at first glance. Upon second look, one can see the common elements connecting to the wider membership, one level up from the distinct actuarial disciplines that define us, the same way a corporate unit oversees broader subjects within a company. The council members and I oversee 12 committees including Research Executive, Emerging Practices, Climate Change and Sustainability, Health, Predictive Modelling, New Members, and the Volunteer Management and Development Committee. Diverse? You bet! Wide-ranging? Absolutely! Boring? Never!

An Introspective Look at the MSC

The MSC underwent a full review of its activities in recent months under the leadership of its previous Chair, Marie-Hélène Malenfant, with a clear intent to focus its efforts on functions requiring actuarial expertise. The revised scope still offers its fair share of challenges, not the least of which is to identify a common agenda for all of the committees without hindering their key focus areas.

My personal goal during my term as MSC Chair is to improve communication and increase collaboration between the MSC and all the committees it oversees. With a clear vision on having a strong foundation, our initial step focused on clarifying the connection points to our committees, referred to as liaison roles, which since have been adopted by other councils, serving as a template for similar roles connecting committees. Our next step was to create a regular forum for collaboration among committees to share strategic plans and discuss common challenges. Committee feedback on these changes has been positive and we will continue to improve our approach over the coming months.

Activities from MSC Committees

The committees reporting to the MSC do an amazing job carrying out their respective mandates. Their enthusiasm and dedication are remarkable.

A great initiative from the Volunteer Management and Development Committee (VMDC) is the volunteer opportunities published regularly in the CIA announcements e-mail. This initiative helps raise membership awareness and interest in volunteering their time and expertise to CIA activities. The VMDC also has a pilot program to provide opportunities for recently qualified FCIAs to join committees as first-time volunteers; this program came out of a consultation undertaken by the New Members Committee.

Following its own restructure, the Research Executive Council now provides the membership with opportunities to participate on project oversight groups, essentially short-term subcommittees focused on a specific study, either forward-thinking, experience research, or academic in nature, allowing members to focus on topics of interest. For more information on the CIA’s research activities, please consult the Research page on the CIA website.

Our other committees have several projects underway which you will hear more about in the coming months, including some on public statements, climate change, and consultations with pension authorities, to name just a few. Stay tuned for more!

The members of the Member Services Council are Benoit Miclette (Chair), Stephen Cheng, Neil Duffy, Claude Ferguson (Board liaison), Paul Gobeil, Véronique Ménard, Nari Persad, Martin Roy, Yeh Ching Seto, Anne St-Martin, and Nimmie Veerappen.

Benoit Miclette, FCIA, is Chair of the Member Services Council.

 
Actuaries on the Move

Career developments

Serge Charbonneau received the Regional Council Award at the 2017 Association of Canadian Pension Management (ACPM) National Conference. This award recognizes the efforts of an individual who has significantly contributed to the work, growth, and development of their regional council. Mr. Charbonneau is chair of the ACPM federal council and a member of the Québec regional council.

Yvon Charest, president and chief executive officer of iA Financial Group, was appointed to the Order of Canada in August.

The new president of tc Health Consulting is Tim Clarke. Previously, he was chief innovation officer, health and benefits, at Aon Hewitt. Prior to that, he was Canadian health management consulting leader at Hewitt Associates, a firm he joined in 1993.

Manulife has elevated the role of chief actuary to reflect the importance of this function to the company's success. As a result, Steven Finch, Manulife's chief actuary, will report directly to Manulife’s president, Roy Gori, effective January 1, 2018.

Manulife has appointed Naveed Irshad as head, North America legacy business, effective January 1, 2018.

Desjardins Insurance named André Langlois senior executive vice-president of life and health insurance. Langlois will lead operations across the company’s business lines, including individual, group and business, and creditor and direct insurance, as well as group retirement savings. Langlois has been with Desjardins for almost 30 years.

Paul Lorentz has been appointed head, global wealth and asset management at Manulife.

PartnerRe appointed Jerome Matrundola as CEO life and health, Asia Pacific.

Emmanuel Matte is managing director at Hexavest. Previously, he was head of global investment solutions at Manulife Asset Management, a firm he joined in February 2015 from Standard Life Investments where he served as senior vice-president, investment solutions.

Harry Panjer was elected president of the Comox Valley Community Foundation.

Michel St-Germain received the 2017 ACPM Industry Award which recognizes the efforts and achievements of an individual who has proven to be an inspiration for fundamental change in the Canadian retirement income industry. In addition to his work at Mercer, Mr. St-Germain is Chair of the CIA’s Pension Advisory Committee and sits on the ACPM national policy committee and executive committee. Over the past two years, he has been involved with the ACPM national policy subcommittees on a voluntary CPP, FSCO actuarial guidance, CPP expansion, and Ontario funding reform.

Actuaries in the media

Robert Brown was quoted in a Benefits Canada article on target-benefit plans.

Thierry Chamberland, Mathieu Tessier, and Michel Fortin were quoted in an Insurance Journal article on increased longevity and pension plan risk management.

Malcolm Hamilton was cited in a MoneySense article on Canadians saving for retirement.

 

Networking is a key part of any successful professional's career, and the CIA is offering you a fresh opportunity to inform your peers about your achievements and progress.

Our (e)Bulletin section, Actuaries on the Move, is a chance for you to publicize your new job, title, credentials, or other information. This is an opportunity to tell thousands of fellow actuarial professionals—whether they are ex-colleagues, former college friends, potential employers, future clients, etc.—about, for example:

  • Your new job;
  • A change of title or area of responsibility;
  • Your new qualifications;
  • A change of contact details;
  • Awards or other recognition; or
  • Publication of academic papers or articles.

Simply send an e-mail—one line of information can be enough, but feel free to add more if you so wish—to the CIA's English editor at bonnie.robinson@cia-ica.ca and we will aim to include it in the next issue of the (e)Bulletin.

For more news of CIA members and their activities, follow the CIA on Twitter.

 
Insight Decision Solutions
Acutarial Design
RGA Canada
On the Horizon

By Jeffrey Baer, FCIA

Not long ago, I realized that actuarial science was a highly specialized form of predictive analytics—an insight that didn’t occur to me throughout my undergraduate education in actuarial science, or in six years of studying for actuarial exams. It wasn’t until I had been leading an analytics team for over a year that it dawned on me: my two professional identities, actuary and analytics professional, are cut from the same cloth.

Practical Applications

Consider the two most common actuarial functions: pricing and valuation. We’re taught to apply specific actuarial techniques to determine indicated rates—but any analytical process that produces rates that are not excessive, inadequate, or unfairly discriminatory could be a valid pricing approach. Determining reserves that are sufficient to cover unpaid claims and expenses is a forecasting problem that can be attacked using a host of different predictive modelling methods.

As manager of advanced analytics at Economical Insurance and Sonnet Insurance, I am privileged to lead a diverse and accomplished team of analytics professionals with backgrounds in statistics, operations research, geospatial analytics, and machine learning. I’m responsible for collaborating with business stakeholders in areas like sales, underwriting, marketing, and claims to develop data-driven solutions to business problems, and leading research into innovative applications of predictive modelling within our organization. My job description doesn’t require an actuarial background. Yet time and again, I’ve found that being an actuary serves me well in the analytics world.

Actuarial Concepts in Non-actuarial Domains

In some cases, my team takes traditional actuarial concepts and applies them to non-actuarial domains. For example, we recently engaged our claims department to address an interesting business problem at Economical. We have a great team of 20 field adjusters who are on the ground supporting our customers during the property claims process. But to ensure we achieve strong customer service levels while balancing adjuster capacity, travel time, and other constraints, we have to determine the size of the territory for which each adjuster is responsible. To do this, we can apply actuarial concepts to predict the number of property claims that will require field adjusting over the next year. We can then use these projections as an input to an optimization model that accounts for our objective and constraints and determines optimal adjuster territories.

In other cases, I apply the same skills I learned as an actuary to analytical solution design. Like actuarial science, predictive analytics requires prudence in assumption setting, expertise in programming and data wrangling, and strong business knowledge. From a soft-skills perspective, problem solving, teamwork, and the ability to communicate technical concepts to non-technical audiences are all necessary competencies.

Improving Customer Experience, Internal Processes, and Business Decisions

With these skills in place, applications of predictive analytics to improve the customer experience, internal processes, and business decisions are endless. We’ve used predictive analytics to determine target growth areas, triage accounts for underwriting, detect opportunities for claims recoveries, and optimize the selection of properties for risk inspections.

A Bright Future

The future for the combined actuary/analytics professional is bright. Predictive analytics is now being introduced into the core actuarial syllabus, which is a great development. I look forward to welcoming the next generation of hybrid actuary/analytics professionals to Economical!

Jeffrey Baer, FCIA, is the manager of advanced analytics for Economical Insurance and Sonnet Insurance.

 
Institute News

On August 30, 70 people attended Lies They Told Me about Being an Actuary and Other Tall Tales, a joint networking event sponsored by the Canadian Institute of Actuaries (CIA) and the Actuarial Students’ National Association (ASNA).

Held at the Mill Street Brew Pub in Toronto’s historic Distillery District, FCIA Trevor Cartlidge, a senior consulting actuary at Willis Towers Watson, entertained the crowd with personal stories of screw-ups, dumb moves, and how misinformation changed his life.

The event, a mix of students and CIA members, was a great opportunity for networking and bringing together the actuaries of tomorrow with the actuaries of today. “It was really exciting to see so many actuaries and future actuaries come out,” said ASNA president Victor Wang. “We really attracted a diverse crowd, both of students from schools such as Western, York, Toronto, Waterloo, and more, as well as actuaries from a huge range of employers across the GTA [greater Toronto area].”

Students at the event welcomed the opportunity to make new contacts and hear Mr. Cartlidge’s perspective, the secrets to his success, and the essential toolkit for the actuary of the future. “The event was a welcome opportunity to connect with the Toronto actuarial community,” said Michal Malyska, a statistics specialist student at the University of Toronto. “It was also exciting to be able to explore the Distillery District during the event.”

“It was an excellent opportunity to bring current and future CIA members together in a relaxed atmosphere,” said Alicia Rollo, CIA director, education and professional development. “Trevor was highly entertaining while giving the actuarial students some important food for thought.”

Ms. Rollo adds that the CIA greatly values its close relationship with ASNA and that this could be an annual end-of-summer event in addition to the CIA’s regular sponsorship of the ASNA convention each January.

“We love how this event turned out, and look forward to collaborations with the CIA in the coming years,” added Haider Imam, ASNA president-elect.

 

Are you passionate about particular continuing professional development (CPD) topics you would like to explore at 2018 CIA meetings, seminars, or webcasts? Are you interested in sharing your passion by speaking at an upcoming CIA meeting, which may help you fulfil your requirement to complete 100 hours of CPD activities over a two-year period?

If so, the Committee on Continuing Education wants to hear from you. Send us your ideas for a great CPD topic or submit a proposal to speak at a CIA meeting. Help contribute to the advancement of the actuarial profession in Canada.

We welcome suggestions throughout the year; however, the deadline for proposals for 2018 meetings, seminars, and webcasts is October 27.

Please take a few minutes to respond: Call for CPD Ideas and Speaker Proposals.

 

The latest issue of Seeing Beyond Risk, the quarterly electronic publication, is now available on the CIA website.

In this issue, Sylvain Fortier, chief risk and finance officer at UNI Financial Corporation, describes the skill and expertise actuaries bring to the banking and financial industry, particularly in the area of operational risk management.

Seeing Beyond Risk features contributions from well-known names in actuarial science and experts in the field, writing about topics suggested and honed by the CIA Editorial Panel, readers, and Institute members.

We are sure you will find this article informative and thought-provoking, and we encourage you to distribute it among your friends and colleagues.

 
Events News

CIA Live Mic is an opportunity for members of the CIA to network and exchange ideas about what matters most to you about being an actuary. Meet President Sharon Giffen and Board director Patrick Chamberland to discuss current actuarial matters, answer your questions about the CIA, and help the Institute better understand your needs.

The CIA’s first live mic event was held in April 2017 at the Drake One-Fifty in Toronto. Then-president Dave Dickson and Sharon Giffen, then President-elect, touched on many areas, from the University Accreditation Program to public statements to Canadian actuaries on the international stage. Attendees came prepared with thoughtful questions and comments, and were eager to share their views. Even after an hour of lively engagement, many people stayed at the restaurant to keep the discussions going and to network. It was a great opportunity to see long-time friends and meet new people.

Registration for Live Mic opens October 12 on the CIA website.

Live Mic

Date: Thursday, November 2, 2017
Time: 4:30–6:30 p.m.
Location: Jatoba, 1184 Place Phillips, Montréal
Admission: Free
Format: Q&A and interactive discussion

Refreshments will be served.

 

By Matthieu Landry

Sessions on changes to the Life Insurance Capital Adequacy Test (LICAT) and IFRS 17, and professionalism case studies were the main focus of the 2017 CIA Seminar for the Appointed Actuary.

“With LICAT coming in 2018, and IFRS 17 not far behind, this year’s Seminar for the Appointed Actuary focused on the many changes that CIA members will need to navigate through in the coming years,” said Chris Fievoli, CIA staff actuary, communications and public affairs.

LICAT and IFRS 17 were prominent topics in almost all of the sessions at the seminar, with discussions on the key changes (including philosophical differences) of the new valuation standard, the involvement of actuaries in IFRS 17 implementation, regular engagements with auditors and professionals responsible for the preparation of the financial statements, and more.

Interactive Session on Professionalism for CIA Members

An interactive session that featured two professionalism case study videos and commentary by a panel of seasoned actuaries was also a highlight at this year’s seminar. Audience members participated in live polling using the CIA meeting app—making this a unique continuing professional development and networking opportunity.

“It was also important to take a step back and reiterate the importance of professionalism in our daily work,” said Mr. Fievoli. “This year’s seminar delivered on that account as well.”

Keynote Speaker: Ryan Avent of The Economist

Other seminar highlights include a keynote presentation by Ryan Avent, senior editor and economics columnist at The Economist, who discussed how the digital revolution affects fundamental social institutions—from the structure of the welfare state to the way our cities are built.

Next year’s Seminar for the Appointed Actuary will be held September 17–18, 2018 in Toronto.

Matthieu Landry is senior coordinator, marketing at the CIA.

 

By Matthieu Landry

The 2017 Actuarial Evidence (AE) Seminar featured a variety of sessions covering a wide-range of topics, including wrongful dismissal litigation, David Marshall’s review of the auto insurance system in Ontario, and the impact of modern technologies on the actuarial profession.

Artificial Intelligence

In his session, The Impact of Insurance Company Claims Department Analytics, Carl Lambert, vice-president, national P&C business intelligence at The Co-operators, demonstrated how artificial intelligence via machine learning is used to analyze data and assist with important actuarial tasks.

“The future of artificial intelligence via machine learning is exciting for the actuarial profession,” said Joseph Gabriel, CIA staff actuary, education. “By analyzing so much data effectively and efficiently, insurance claim assessments become more accurate—and this accuracy provides us [actuaries] the ability to detect inappropriate or fraudulent claims more easily, which in the end benefits both policyholders and insurers.”

Human Intelligence

David Marshall, former president and CEO of Ontario’s Workplace Safety and Insurance Board, presented on Fair Benefits Fairly Delivered, his review of the auto insurance system in Ontario. Part of his focus is on improving health outcomes for those injured in collisions while reducing insurance costs for Ontario drivers.

Other sessions provided an introduction to wrongful dismissal litigation and its role for actuarial experts, including managing these complex files in the corporate world. In addition, the AE seminar looked at actuarial evidence in tax cases, in situations where actuaries are called upon to provide advice either at the audit or appeals stage.

The AE Seminar continues to provide actuarial evidence practitioners quality continuing professional development and networking opportunities.

Matthieu Landry is senior coordinator, marketing at the CIA.

 
Volunteers on the Move

Board

The following people have been appointed to the councils named below:

  • Member Services Council: Paul Gobeil, Véronique Ménard, and Nimmie Veerappen, effective immediately; and
  • Practice Council: Peter Douglas, Pierre-Paul Renaud, and George Wang, effective immediately.

The Task Force of the Board on P&C Issues has been created with the following members: Pierre Dionne (Chair), Barb Addie, Renée Couture, and Brian Pelly, effective July 1, 2017.

The IFRS 17 Steering Committee has been created.

The following person has completed his term with the council named below, and leaves with thanks:

  • Member Services Council: Ralph Ovsec, effective April 30, 2017.

The Special Board Committee on the Setting of Actuarial Guidance has been disbanded with thanks.

Practice Council

The following people have been appointed to the committees named below:

  • Committee on Property and Casualty Insurance Financial Reporting:
    • IFRS Working Group: Anna Marie Beaton, Sarah Chevalier, Michel Dionne, Jacqueline Friedland, Patricia Hladun, Nathalie Lavigne, Cynthia Potts, Lisa Yeung, effective June 20, 2017, and Éric Lemay (liaison);
  • Committee on Workers’ Compensation: Crispina Caballero’s term as Chair was extended for one year, Michael Williams (Vice-chair), effective July 4, 2017, and Marie-Hélène Malenfant (liaison);
  • Committee on Actuarial Evidence: Frank Reynolds, effective July 11, 2017 and Dean Newell (liaison);
  • Committee on Post-employment Benefits Plans: Natalie Thompson, effective November 22, 2016 and Dean Newell (liaison);
  • Enterprise Risk Management Practice Committee: Joel Cornberg, Frédéric Matte, Karim Nanji, Sylvie Paquette, effective August 18, 2017, and Steve Easson (liaison);
  • Committee on Pension Plan Financial Reporting: Andrew Gillies (Vice-chair), Benedict Ukonga, effective August 22, 2017, and Dean Newell (liaison);
  • Investment Practice Committee: Peter Douglas (liaison);
  • Appointed/Valuation Actuary Committee: Éric Lemay (liaison);
  • Risk Management and Capital Requirements Committee: Steve Easson (liaison);
  • Property & Casualty Insurance Pricing Committee: Pierre-Paul Renaud (liaison); and
  • Group Insurance Practice Committee: George Wang (liaison).

The following people have completed their term with the committees named below, and leave with thanks:

  • Task Force on Mortality Improvement: Emilie Bouchard;
  • Actuarial Evidence Committee: Brian Burnell; and
  • Committee on Pension Plan Financial Reporting: Angelita Graham.

International Relations Council

The following people have been appointed to the committees named below:

  • International Insurance Regulation Committee: Réjean Besner, effective September 21, 2017; and
  • International Insurance Accounting Committee: Pierre Parenteau, September 21, 2017.

The following person has completed his term with the committee named below, and leave with thanks:

  • International Insurance Accounting Committee: Alex Xu, effective July 4, 2017.