Updated FAQs for Revised U.S. Qualification Standards
Updated FAQs for Revised U.S. Qualification Standards
Last year, the Committee on Qualifications (COQ) released completed revisions of the Qualification Standards for Actuaries Issuing Statements of Actuarial Opinion in the United States (USQS). Since then, the COQ has updated the Frequently Asked Questions (FAQs) on the USQS twice—once in February and once in May. The February release aligned the existing FAQs—including the FAQ on continuing education (CE) related to diversity, equity & inclusion—with the 2022 USQS. The May release added five new questions to the FAQs, many of which are based on questions and comments received on the draft USQS.
Four of the new questions focus on the revised basic education and experience requirements:
Do the three years of experience in the particular subject relevant to the SAO 2.1(d)(2) or the single year under 2.1(d)(1)(ii) need to be obtained while working directly under a qualified actuary who is preparing actuarial opinions?
Per section 2.1(d)(1)(ii) and 2.1(d)(2), the three years of experience must have been under review by an actuary who was qualified to issue the SAO at the time the review took place under the standards in effect at the time. There is no requirement to work “directly under” the qualified actuary, but the qualified actuary must have reviewed the actuary’s work and must have been appropriately qualified “at the time the review took place.” The USQS does not require the reviewing actuary to have actually issued the opinion, so long as he or she was qualified to do so at the time of review.
Does the work experience gained while obtaining the basic education credential count as responsible actuarial experience under sections 2.1(b) and (d)?
Yes. Many actuaries start to obtain responsible experience before completing their formal basic education.
How does section 2.1(d) apply with respect to a particular subject area?
Basic education may cover a wide range of subject areas, but the knowledge that a given actuary has obtained in a particular area may be limited. Therefore, in some circumstances, an actuary may need to obtain education and/or experience in order to be qualified to issue a Statement of Actuarial Option in a “particular” subject area. For example, this may occur when a subset of the areas covered by the actuary’s basic education or related in some way to the actuary’s basic education has not been used as part of the actuary’s experience. The facts and circumstances involved will influence the application of section 2.1(d).
How does the experience required in section 2.1(b) relate to the experience required in section 2.1(d)?
Section 2.1(b) experience is generally obtained during the first full three years of employment in an actuarial position. The experience is often, but not necessarily, more general and at a trainee level.
Section 2.1(d) experience is obtained working in a specific subject area such as life or property and casualty statutory valuation or pricing, health care pricing, long-term care valuation or pricing, ERM, employee benefit plan valuation, etc. The experience obtained for both sections may overlap, depending upon facts and circumstances.
The fifth new question concerned the continuing education (CE) requirements for signing National Association of Insurance Commissioners (NAIC) annual statements:
Does the 15 hours of CE needed to meet the Specific Qualification Standard need to be distributed evenly across the topics mentioned for a specific NAIC statement in section 3.1?
In any given year, an actuary's CE may not be “evenly” distributed among the topics that are required to be qualified and may not include each topic, but a particular year’s 15 hours of CE should come from those topics. To qualify as CE under the specific qualification standard, CE must be "directly relevant" to the topics listed in section 3.1 for the SAO the actuary intends to issue.
If you have a question about the USQS, we encourage you to review the standards and the FAQs. If those do not answer your question, you may want to submit a question to the COQ or request guidance from the Actuarial Board for Counseling and Discipline.
