Professionalism Counts, April 2026
“Good communication is the bridge between confusion and clarity.”1
Precept 4 of the Code of Professional Conduct embraces this simple idea by requiring actuarial communications to be clear and appropriate to the circumstances and intended audience. Before we take a closer look at what this means in practice, let’s note that the Code defines an actuarial communication broadly—“a written, electronic, or oral communication issued by an actuary with respect to actuarial services”—so this discussion applies to much of what you do.
Clear and appropriate
Because actuaries have specialized knowledge, training, and experience, non-actuaries must rely on information actuaries provide to make decisions that affect their financial well-being. The actuary therefore has a responsibility to provide information in a manner that the intended audience can understand.
But what is “clear and appropriate” depends on that audience. For example, language appropriate for another actuary may not be appropriate for another financial professional, while language appropriate for a financial professional may not be appropriate for the public. The language typically should strive to be clear enough that the intended audience can understand the uncertainties inherent in the work—and therefore the extent to which they may rely on it.
The concept of clarity extends to who is responsible for the work, and Precepts 4 and 5 mandate that every actuarial communication identify
- The actuary responsible for the work;
- The extent to which the responsible actuary or other sources are available to provide more information or explanation; and
- The principal for whom the communication is issued and the capacity in which the actuary serves.
Satisfying applicable ASOPs—Disclosure requirements
Precept 4 also requires you to ensure that your actuarial communications satisfy applicable actuarial standards of practice (ASOPs). While the Code discusses actuarial communications, most ASOPs detail disclosures required in a specific type of actuarial communication: the actuarial report. An exception is ASOP No. 41, Actuarial Communications, which applies to every actuarial communication.
The Code provides basic principles, while ASOP No. 41 adds more detail and specific requirements, but both emphasize the need for clarity. ASOP No. 41 states, “In the actuarial report, the actuary should state the actuarial findings, and identify the methods, procedures, assumptions, and data used by the actuary with sufficient clarity that another actuary qualified in the same practice area could make an objective appraisal of the reasonableness of the actuary’s work as presented in the actuarial report.”2
Protecting the public—and yourself
Disclosures help you meet your Precept 1 obligation of integrity and honesty—helping you to fulfill the profession’s responsibility to the public. Such a disclosure may even protect you, the actuary, if questions are later raised about the work. (It’s worth noting that Precept 4 has been cited in eight cases of public discipline on the Academy’s website.)
Actuarial work underpins products that provide financial security through insurance and pensions—products that many Americans rely on when disaster strikes. Nearly 40 percent of Americans cannot easily cover an unexpected $400 expense3—they need the benefits promised by the products actuaries work on to be there when needed. Clear communications and disclosures—even, or perhaps especially, those that may put you in an uncomfortable position—help intended users make better decisions regarding these products and thus help actuaries fulfill the profession’s responsibility to the public.