Current CAS Issues and Directions

1
Current CAS Issues and Directions
Sheldon Rosenberg CAGNY Meeting Dec. 6, 2004, New
York City
2
Agenda

• CAS Centennial Goal
• Two Important Task Forces
• Task Force on ACAS Vote
• Task Force on Classes of Membership

3
CAS Centennial Goal

• The CAS will be globally recognized as the
  preeminent resource in educating casualty
  actuaries and conducting research in casualty
  actuarial science. CAS members will be
  recognized as the leading experts in the
  evaluation of hazard risk and the integration of
  hazard risk with strategic, financial and
  operational risk

4
Implementing the Centennial Goal

• Centennial Goal Implementation Task Force
• Subcommittee of Long Range Planning Committee
• Working with Vice Presidents and Committee Chairs
  in setting goals.
• How does my committee and its goals support the
  Centennial Goal?
• SAM Goals
• Significant, Attainable, Measurable
• Interim milestones to help gauge progress towards
  the Centennial Goal.

5
Two Important Task Forces

• Task Force on the ACAS Vote
• Should Associates have voting rights?
• All ACAS? After N Years as an ACAS?
• Stand for election to the Board?
• Hold officer positions, e.g., Vice President?
• Serve on and chair committees? Which ones?
• Task Force on Classes of Membership
• How many classes should the CAS have?
• How should these classes be defined?

6
Historical Perspective of Associates

• Since 1914, two classes of membership.
• Associate and Fellow designations have changed
  over the years
• Initially, based on company responsibilities.
• Fellows Department heads.
• Associates Actuaries who worked within
  departments.
• Beginning in 1915, based on exams
• Number and content of exams has varied.
• Currently a two-exam educational difference.

7
Where is the ACAS Now?

• Educational difference is limited.
• Both FCAS and ACAS are MAAA.
• Continuing ed requirements are the same.
• Generally little distinction in U.S. (AAA, NAIC)
  between FCAS and ACAS license to perform
  professional actuarial services.
• Most nations have one class of membership.
• Already an issue in Canada (CIA).
• Complicates mutual recognition agreements.
• IAA educational requirements also an issue.

8
Task Force on ACAS Vote

• Why are we considering this issue?
• Voting rights unchanged since 1914 reflect a
  time when there was a greater difference between
  classes.
• Associates are an important part of the Society
• 25-30 of Associates no longer take exams.
• Many Associates contribute extensively to the
  profession as volunteers, on committees, as
  speakers and authors, etc.
• Their contribution as practitioners is
  undeniable.
• Associates pay full dues, but cannot vote.
• Mutual Recognition issues.

9
Task Force on ACAS Vote

• Right to vote should be granted upon earlier of
  Fellowship or five years after Associateship.
  Right to vote should be unrestricted.
• All voting members should be allowed to stand for
  election to the Board of Directors.
• Voting Associates may hold all officer positions,
  with the exception of
• President / President Elect
• Vice President - Admissions
• Committee membership is to remain restricted to
  Fellows for Discipline, Education Policy,
  Syllabus, Fellowship Exam Committees.

10
Task Force on Classes of Membership

• Why are we considering this issue?
• In the U.S., two classes of membership looks like
  a distinction without a difference.
• AAA confers full rights on both classes.
• Associate designation connotes lesser standing,
  even though the ACAS is fully qualified to sign
  statements of opinion.
• Two designations for fully qualified actuary
  are confusing.
• Not considered qualified outside the U.S.
• Fails IAA fully qualified actuary criteria.
• Inadequate Finance, though other areas well
  beyond minimum.
• Can create Mutual Recognition issues.
• Can complicate efforts to export our educational
  system.

11
Task Force on Classes of Membership

• The Task Force recommended (May)
• Only one class of membership - Fellow.
• Certificate of Achievement in Casualty Actuarial
  Science.
• All candidates under the Code of Professional
  Conduct.
• ACAS continue to be awarded for a limited time.
• Existing ACASs awarded FCAS after completing
  exams or after five additional years have passed.
  
• Task Force was split on this issue.
• Ideal number of exams for Fellowship is eight
  necessary material can be reorganized to fit.

12
Task Force on Classes of Membership

• In May 2004, the Board discussed the various
  transition options in the Task Force Report.
• Options ranged from
• Immediately granting FCAS to ACAS and
  discontinuing ACAS
• Completion of additional requirements
• Discontinuing ACAS after a transition period and
  putting the ACAS into run-off.
• Under no circumstances would current Associates
  lose their status as members of the CAS.

13
Classes of MembershipFollow-up

• Additional information was collected for the
  Boards subsequent consideration during its
  September 2004 meeting.
• Survey of the Membership Advisory Panel (MAP).
• Feedback from Regional Affiliate Presentations.
• Interviews with recruiters on the effects of one
  class of membership on attracting candidates.
• Interviews with actuarial science professors.
• Feedback submitted by members.

14
Classes of MembershipFeedback

• Summary of additional feedback received
• Over two-thirds (70) of the MAP agreed with TF
  recommendation of one class.
• More than three-fourths (77) disagreed with the
  TF recommendation to grant all ACAS the FCAS
  designation without additional requirements.
• Most of the feedback has indicated that one class
  of membership will not create a competitive
  disadvantage for students.
• Actuarial Science professors may disagree.

15
Board Findings onClasses of Membership

• Board Motions at September Board Meeting
• That the Board instruct the Executive Council to
  establish a TF to propose within the next year a
  set of learning objectives by which FCAS can be
  attained
• with less material than the current exams,
• with fewer than the current 9 exams,
• while meeting the requirements of the IAA,
• while being consistent with the Centennial Goal.
  
• It is the Boards sense that this can be
  accomplished with eight exams (or seven exams
  with a workshop or seminar).

16
Board Findings on Classes of Membership

• Board Motions at September Board Meeting
• Inform the CAS membership of the foregoing
  action, with an indication that the Board
  supports a move to an eventual single class of
  credentialed membership, with no more new
  Associates, concurrent with the movement to a
  shorter syllabus and will seek membership
  reaction to this plan. (It is expected that the
  then-current Associates will either complete
  their remaining exams and become Fellows, or
  remain Associates until they cease their
  membership in the CAS.)

17
Membership Involvement

• Board is committed to obtaining member input.
• Granting voting rights requires an amendment to
  the Constitution approved by Fellows, however,
  the Board agreed to postpone further action on
  the ACAS Vote, pending resolution of the Classes
  of Membership issue.
• Moving to one class of credentialed member may
  not require a change to the Constitution, but
  there will be a thorough exchange of ideas.

18

• Thank You!