Professionalism Counts, May 2026
Merriam-Webster defines conflict of interest as “a conflict between the private interests and the official responsibilities of a person in a position of trust.” Investopedia goes a bit further: “a conflict of interest emerges when a person’s private interests have the potential to interfere with professional responsibilities, potentially compromising objectivity and impartiality.”
Trust, objectivity, and impartiality. These three concepts are vital to upholding actuarial professionalism. A conflict of interest may impede your objectivity, causing you to render actuarial services that aren’t entirely in the principal’s or the public’s interest. Even the appearance of a conflict of interest can undermine confidence and trust in your ability to provide actuarial services objectively and impartially.
Precept 7 lays out the conditions under which an actuary may perform actuarial services when an actual or apparent conflict of interest exists:
- Your ability to act fairly is unimpaired;
- The conflict has been disclosed to all present and known prospective principals whose interests would be affected; and
- All such principals have expressly agreed to you performing the actuarial services.
Conflicts of interest, then, must—at the very least—be acknowledged and disclosed. But how do you know if you have a conflict of interest? Conflicts of interest are common, and those closest to them may not immediately see them. If you suspect that you may have a conflict of interest, you may want to discuss the situation with others to get a second opinion or submit a request for guidance to the Actuarial Board for Counseling and Discipline.
In most cases, the best course of action is to disclose the actual or apparent conflict, to be transparent and honest. If you look in the mirror and honestly believe that despite the conflict of interest you can still provide actuarial services fairly, the conflict has been disclosed to all principals involved, and those principals have agreed to your provision of the services, you may provide those actuarial services. But if you think you may not be able to act impartially, you haven’t disclosed the conflict, or the principals do not agree, you should turn down that assignment. In addition, if you cannot disclose the conflict without violating confidentiality, it may be best to turn down the assignment or recuse yourself from the matter.
One type of conflict of interest is so common in the business world that the Code specifically calls it out—a financial conflict of interest. Precept 6 requires you to disclose to present or prospective principals all sources of material compensation that you or your firm has received or will receive from another party in relation to an assignment for which you have provided or will provide actuarial services for that principal. These disclosures are limited to sources that you know or may reasonably ascertain. If your employer operates in multiple locations, you must disclose the compensation regardless of where it was received.
Relational conflicts of interest are also recognized in the Code. Under Annotation 6-1, if you are not financially or organizationally independent concerning any matter related to the actuarial service being provided, you must disclose any pertinent relationship that is not apparent to the principal.
Transparency: The Key to Trust
As in so many areas of professionalism, the key to the proper handling of conflicts of interest lies in honesty, transparency, and disclosure. By consistently adhering to these principles, you help protect the public and maintain trust in the profession.
COI Policy for Academy Volunteers
Each year, the Academy requires its volunteers to agree to follow the Academy’s conflict-of-interest (COI) policy. Because the Academy aims to provide objective and impartial information to public policymakers, committee members with actual, possible, or perceived conflicts of interest must disclose that conflict to other members of the committee (as long as such disclosure would not violate confidentiality). If a volunteer cannot disclose the conflict, the volunteer should not participate in committee work for which the actual, possible, or perceived conflict exists.
For more information on conflicts of interest when volunteering for the Academy, see Conflicts of Interest When Doing Volunteer Work.