CAE: Looking Back on 10 Years of ExcellenceContinued improvement in the education of actuaries February/March 2019
The Society of Actuaries (SOA) Board of Directors established the Centers of Actuarial Excellence (CAE) program in 2008 as part of a suite of initiatives to strengthen the profession’s academic branch. SOA academic connections at that time were tenuous at best, and the profession had no standardized way to influence the education of its student actuaries. The Board believed that universities represented an important source of education and research that could be enhanced through working with the SOA to develop stronger connections with industry and the profession.
The CAE program identifies actuarial science programs that embody a dynamic and broad curriculum, quality research and strong connections to industry. But the key success of the program has been its ability to motivate universities to use the eight CAE criteria (see sidebar) as a benchmark for improvement. Having such criteria has allowed program leaders to approach their administration for needed resources as well as to enhance their program’s offerings to align with the SOA’s expectations. Over the past 10 years, we have seen many programs strive for and ultimately earn CAE status.
The Centers of Actuarial Excellence (CAE) standards help ensure a university can sustain a robust program of education, research and scholarship. Universities seeking to be a CAE must apply for and meet four quantifiable A Criteria and four qualitative B Criteria:
- Criterion A.1: Identifiable major/degree in actuarial science
- Criterion A.2: Curriculum coverage at 80 percent or better on four of the seven preliminary exams, with at least one being LTAM or STAM
- Criterion A.3: Number of graduates averages 10 or more per year
- Criterion A.4: Faculty composition includes credentialed actuaries
- Criterion B.1: High-quality graduates as demonstrated by job placement, exam passing and so on
- Criterion B.2: Integration with business/communication fields
- Criterion B.3: Connection to industry
- Criterion B.4: Peer-reviewed actuarial research and other professional contributions
CAE Benefits for the Profession
The strong university connections made through the CAE program benefit the SOA and its membership. The CAE curriculum criteria help to ensure actuarial education at these universities meets the ever-changing demands of the profession. CAEs are currently adding enhanced statistical education and predictive analytics components to their courses due to the changing actuarial environment and the new requirements on our ASA syllabus.
In 2014, the SOA Board approved an international expansion of the CAE program. This was significant to all CAEs, as they became part of a global assembly of quality actuarial programs. This development has put the CAE program in a position to showcase the SOA globally and support the SOA’s increased international focus. It has helped build strong connections to top-tier actuarial programs at universities worldwide and aids in the development of actuarial intellectual capital. Outside of North America there are now CAE programs in Australia, China, Hong Kong and Scotland.
CAE Review and Survey
In 2013, the SOA Board conducted an analysis of the CAE program. They surveyed members of the academic community and CAE volunteers. Universities affirmed the eight CAE criteria, reporting positive effects in both maintaining program standards and encouraging further program development.
Overall, CAE universities were very positive about the program and its benefits. Ninety-two percent said the award of CAE status had been somewhat or very beneficial to their program. They cited improvements in attracting students and employers to the program and strengthening the status of the program within the university, including securing additional faculty positions.
Respondents also cited the value of having clear standards for actuarial science programs to share with university administrators. Overall, the research indicated the CAE program was working well, and the Board approved continuation of the program with minor clarifications and process adjustments.
Well-rounded Actuarial Education
CAE programs exemplify the importance of interdisciplinary education. Beyond preparing students for the actuarial exams, each program works to integrate business and communication skills. This integration is done through case studies, research projects, and by requiring or encouraging actuarial science students to attend classes offered by other departments. Serving as guest speakers, adjunct faculty and advisory board members, actuaries in industry (including alumni) provide direction and insight to the faculty and students. Through this involvement, CAE faculty members establish long-term relationships with alumni and the business community. These relationships keep faculty and students tuned into the latest developments within the profession.
Over the last 10 years, the CAE label has become a recognized brand of quality for students seeking an actuarial education and for employers looking to recruit outstanding talent. The program has exceeded expectations regarding the number of universities now included in its ranks—there are 33 CAE universities worldwide as of Jan. 1, 2019. The positive influence that the rigorous criteria has had for universities is also a key to the success of the program and is resulting in continued improvement in the education of actuaries. We look forward to seeing where the next 10 years will take us.
Copyright © 2019 by the Society of Actuaries, Schaumburg, Illinois.