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Actuary
February 2018 Issue
the
Vol. X - Issue 02
Pages 36 20
INDIA
www.actuariesindia.org
Actuary
the
INDIA
CONTENTS "A noble man's thoughts will never go in vain. -Mahatma Gandhi."
www.actuariesindia.org "I hold every person a debtor to his profession, from the which as men of course do seek to receive countenance and profit,
so ought they of duty to endeavour themselves by way of amends to help and ornament thereunto - Francis Bacon"
CHIEF EDITOR
FROM THE DESK OF CHIEF EDITOR
Mr. Sunil Sharma ...................................................................................................................................................................... 4
Sunil Sharma
Email: sunil.sharma@kotak.com th
19 GCA INTRODUCTORY ADDRESS – PRESIDENT, IAI
Mr. Sanjeeb Kumar .................................................................................................................................................................. 5
EDITOR FROM THE DESK OF EXECUTIVE DIRECTOR
Mr. D C Khansili ....................................................................................................................................................................... 7
Dinesh Khansili
Email: dineshkhansili111@gmail.com 19th GCA PRESS COVERAGE .............................................................................................................................................. 10
PHOTO FEATURES OF 19TH GLOBAL CONFERENCE OF ACTUARIES ........................................................... 18
COUNTRY REPORTERS BEST ARTICLES & BEST REPORTAGE AWARDS .................................................................................................... 21
Nauman Cheema PHOTO FEATURES OF COACHING CONDUCTED BY INSTITUTE OF ACTUARIES OF INDIA
Pakistan TH TH
ON 9 – 10 JANUARY 2018 ........................................................................................................................................... 22
Email: info@naumanassociates.com
INTERACTION WITH CHAIRMAN OF LIFE INSURANCE CORPORATION OF INDIA ........................... 23
Kedar Mulgund
Canada AG UPDATE
Email: kedar.mulgund@sunlife.com Advisory Group on Health Care Insurance
by Mr. Vishwanath Mahendra ........................................................................................................................................... 26
T Bruce Porteous
United Kingdom FEATURES
Email: bruce_porteous@standardlife.com
Introduction to Machine Learnings for Actuaries
by Mr. Suresh Sindhi .............................................................................................................................................................. 27
Vijay Balgobin
Mauritius
Email: vijay.balgobin@sicom.intnet.mu
Digital disruption in BFSI sector
by Prof. Venkatesh Ganapathy .......................................................................................................................................... 30
Rajesh S
Singapore Unit Linked Insurance Plans (ULIPs) and Mutual Funds – How different are they?
Email: prasannarajesh30198@yahoo.co.in by Deepshika Amin & Om Prabhu ................................................................................................................................... 31
Devadeep Gupta CAREER CORNER
Hongkong Star Health and Allied Insurance Co. Ltd ...................................................................................................................... 2
Email: devadeep.gupta@prudential.com.hk Principal Global Services ..................................................................................................................................................... 25
John Smith
New Zealand
Email: johns@fidelitylife.co.nz
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the Actuary India February 2018 03
EDITORIAL WRITE-UP
Message From The Chief Editor
not worth a miss with excellent
cultural programs. Further, the
beauty of the event was to honour
Mr. Liyaquat Khan, Past President
of IAI for his immense contribution
to the profession. The profession is
indebted to the contribution made
by him for the evolution of ASI and
turning it into a global profession.
We from Actuary India, wish him a
healthy and pleasant time ahead.
The profession is passing through
an interesting phase. There are
only 24 insurers and only 33 non-
life insurers. We have over 375
qualified actuaries in India and this
number is growing rapidly. This is
likely to lead to supply of actuaries
non-traditional areas of practice
increasing the penetration of the
profession into banking,
investments, investment banking,
wealth management, risk
management, data analytics and
many more avenues. IAI is working
to strengthen its marketing team
and taking initiative to target
current and potential future
It's indeed extremely refreshing to Overall it was a successful event employers to enhance the
catch up through this column after with lot of applause from opportunities available to its
the end of the 19 th Global attendees. members.
conference of Actuaries which was
scheduled on 30th-31st January, The event was attended by over I firmly believe that some of these
2018. I would like to take this 750 people from all across the initiatives will lead to generation
opportunity to thank each and world. The conference was of fairly good amount of
everyone involved in managing the attended by delegates from employment for actuarial students
GCA event and also to those who actuarial profession in UK, USA, and qualified actuaries in non-
made the efforts to attend it. The Australia and many other traditional areas.
event was very professionally countries. Chairman from IRDAI
managed. Main attraction of the and PFRDA addressed the I look forward to this and with this
event was the large LED screen delegates. Twenty two sessions note I will like to sign off now.
which ensured that the text in the were conducted over a period of 2
presentation was even visible to years in the area of Life, General,
the audience sitting in the last Pensions, Investments, data
row. Further, there was significant analytics, Risks, M&A, IPO and
enhancement in the use of business management.
technology for quick registration
and simplified check out process. IAI 2018 AGFA award was an event
the Actuary India February 2018 04
19TH GCA INTRODUCTORY ADDRESS
Introductory Address - Mr. Sanjeeb Kumar, President, IAI
Honorable Chief Guest of the and prestigious flagship event of our For students and our young actuaries
seminar, Mr T S Vijayan, Chairman Institute “19th Global Conference attending the event, let me say that
of IRDAI, Mr V K Sharma, Chairman of Actuaries”, which brings experts this is a unique opportunity to
of the LIC of India, CEO of RGA from various domains from across prepare themselves for
India, Mr K S Gopalakrishnan and my the world on a common platform. opportunities that lie ahead. So the
colleagues from the Institute, Mr R theme of the GCA - “Actuaries –
Arunachalam, Vice President and The participation of members from through Crystal Ball” aptly covers
Mr D C Chakraborty, Chair of global community is especially it. This is the time to look into the
External Affairs and Research encouraging as it re-affirms the future using the crystal ball and be
Committee. I extend warm confidence & faith that the Global prepared for challenges and
welcome on behalf of our Industry has in India, one of the opportunities ahead,
Institute. fastest growing economy of the
world. Actuarial Profession and activities-
Special welcome to distinguished A Repertoire
guests- Mr Nilesh Sathe, Member Also let me say that it is encouraging
Life, IRDAI; Ms Pournima Gupte, to see the diversity in the profile of Let me briefly share some numbers/
Member Actuary, IRDAI, Senior speakers; diversity in the profile of statistics:
delegates from IRDAI, CEOs of delegates; diversity in the areas of
Insurance companies from India and practices ranging from traditional § We are old institute as well as new
abroad, my colleagues from the areas of Life & General Insurance, Ÿ Old because our foundations set
Council, Current and past Pension, to emerging areas of Risk, back in September 1944 when
presidents of actuarial bodies Data Analytics and business strategy our erstwhile body, ASI was
attending the event, dignitaries and innovations where actuaries are formed.
from overseas and from India, and expanding into. Ÿ We have been the full member
my dear delegates. association with the IAA since
I, therefore, believe that it's a last 38 years.
To all delegates, on behalf of unique opportunity for all of us to Ÿ We have quite a few members
Institute, I express my heartfelt interact, share local and global who have even completed 50
gratitude for your participation & knowledge, identify the local & years of fellow membership
welcome you all to the important global trends in the industries.
the Actuary India February 2018 05
§ Introduced new standard -
ACTUARIAL PRACTICE STANDARD
33 – AAs working in General and
Health Insurance
§ Revised the CoP Guidelines –
effective from new as well as
renewal of CoP effective from
next FY
§ Seminars and Capacity Building
Programs – 16 programs during last
one year attended by over 1500
delegates excluding GCA event.
§ 9 Skill development programs for
§ New in the sense that because 94% employers our students – 9 programs (product
of members are young and bright pricing – Trade/ Economic Capital
students Other Activities based; Reserving, R Language and
Ÿ We have total membership of its application
8751 of over 8200 students and § On the regulatory & professional
160+ Associates. Our Fellow development front, § IAI Office – new building learning
membership has also increased and skill developments for our
to 375 of which 39 qualified § To strengthen further the actuarial students and young qualifiers
during last one year. services governance, we have remain key priority for the
strengthened existing APS in Institute - Thanks all great
§ We are net exporter of actuarial Pension and employee benefit volunteers for supporting the
services - over 20% of fellows as valuation area and introduced above activities.
well as students work either from this month a comprehensive
overseas or sitting in India working standard “APS 27” in place of
exclusively for overseas clients/ multiple standard.
the Actuary India February 2018 06
FROM THE DESK OF EXECUTIVE DIRECTOR
Actuaries as a Career Option and its Future Prospectus
handsome packages to the good
quality actuarial professionals and
the trend continues.
Actuarial Professionals at national
and international level have
unparalleled advantage in all the
work areas of an Insurance
Company. The following are the
primary but not limited to; Risk
Management; Product design and
Pricing; Managing Policyholders
reasonable expectations relating to
benefits/ bonus distribution, Policy
Illustration, Managing
Investments/ Asset Liability
Management, Actuarial Models
d e v e l o p m e n t , Pr e d i c t i v e /
Stochastic modelling, Information
Technology, New Initiatives,
Compliance, Advice to other
Introduction of intense preparation to become a
departments e.g Policy servicing/
The roots of Actuarial Science are qualified actuary. Any place where
HR (efficiency/employee benefit)/
sprawling to year 1613 when a book risk and uncertainty exists,
IT, Valuation of Liabilities;
on compound interest was published irrespective of its financial or other
Solvency Maintenance, mergers
by Richard Witt, hence can be nature, actuaries have a big role to
and acquisition, analysing the
considered as one of the oldest play. However, due to clustering of
business parameters/experience
profession in the world; however the financial risk in the business of Life
e.g persistency, claims, expense
awareness about Actuarial Science or Insurance, General Insurance,
management, Shareholders' and
Actuarial profession continue to be Health Insurance, Reinsurers,
regulatory reporting, Insurance
limited, most of the time within the Pensions and financial investments,
E d u c a t i o n a n d Tr a i n i n g
contours of high level financial actuaries are more preferred to be
Reinsurance treaty maintenance,
professionals. This limited awareness employed in Insurance and credit
Underwriting, ETC
is not limited to India but across risk and Wealth management
globe. companies. Other areas include
Actuaries and Nation Building
banking, stock markets, financial
The Actuaries' role was felt by the
The importance of actuarial science product brokers and valuation of
country when Actuaries touched
can be judged by the fact that there employee benefits. The data science
the lives of Government, Public and
are number of qualified actuaries and is the new area where actuaries and
Private sectors' employees and
actuarial students pursuing Actuarial actuarial students has natural
their family members by designing
Science are also from other inclination to excel. .
and setting up and managing the
professions like CA, MBAs from IIMs,
Gratuity schemes under payment
Statisticians from ISIs, Intellectuals During nationalisation of insurance,
of gratuity act 1972 and
from IITs and also from many LIC of India was the major employer
superannuation schemes. The
prestigious engineering colleges and of actuarial personnel and the
Actuaries are helping in managing
universities. The salaries match to prominence and recognition of
the Government of India (GoI)
any best in the industry. actuaries were apparent when most
initiatives in providing the
of its Chairpersons were Actuaries.
insurance coverage to masses
The career graph of Actuaries has There was a sharp demand and
under Pradhan Mantri Suraksha
been fairly long and steep upward supply gap existed for actuarial
Bima Yojana, Pradhan Mantri Jan
moving in nature; the dedication, personnel once insurance sector was
Dhan Yojana and Aam Admi Bima
sacrifice and hard work to be opened up for the private players in
Yojana for BPL families, Universal
invested for an average of 6 to 7 years the year 2000. The market offered
the Actuary India February 2018 07
health insurance schemes for APL professions say- medicine, in planning and annual budget.
families, Jan Arogya policy, Janata engineering and space science. Hence no dearth of employment
Personal Accident schemes, the Actuarial Science is no exception. opportunities for actuaries.
students' safety, Ashraya Bima However, the fact remains that the
yojana, Rural and Agriculture development in science has helped Actuarial Education
Insurance, Swavalamban, etc. Actuaries to get better information Currently the ACET (Actuarial
to do their work. Common Entrance Test) is the entry
Actuaries helped by designing and gate to get eligibility to write
managing the plans for small and Even today in traditional actuarial actuarial examination in India. A
large scale businessmen to carry on areas there are some jobs done in student who is good in English,
their businesses. The Bankers' limited way. In Life Insurance, the Mathematics and Statistics with +2
indemnity policy helps control the Group Insurance is an area where level can clear the ACET, though
risks of looting and fraud. LPG has schemes membership ranging to 10 K the entrance examination is not
reached to door steps of poor. LPG and above, there is no concrete limited to only science stream
dealers ensure the regular supply and information on attrition rates. There students. Students study financial
so their safety net is of utmost are number of other studies mathematics, finance and its
importance. Multi- Peril policy for undertaken in Life Insurance; similar reporting, probability and
LPG dealers is in place. Meritorious studies need to be undertaken in mathematical statistics, statistical
sports winners at Olympics and Asian General Insurance and Health methods, create models-
Games and Artists schemes provide Insurance areas. The Appointed deterministic and stochastic, their
pension and insurance coverage to its Actuary (AA) system is well documentation analysis and
members. SEWA is providing established in Life Insurance reporting, life, health and other
insurance and health insurance with business and at the same length and contingencies depending on
help of insurers and actuaries to their breadth the AA system need to be survival or happening of some
members. Similarly the social established in Health and General event, Business Economics
schemes are in place for beedi Insurance Industry. including but not limited to
workers, carpenters, brick kiln developing the behaviour of
workers, fishermen, cobblers, T h e Po s t a l L i f e I n s u r a n c e , interest rates, financial economics
handicraft artisans, hamals, rickshaw Agriculture Insurance Company, ESI, and general business. All these
pullars, bidi patta collectors, ECGC and IMGC type organisations, important aspect of risk
handloom and khadi weavers, leather actuarial departments are yet to be management and modelling are
and tannery workers, lady tailors, strengthened in order to bring in included in the first 9 examinations
physically handicapped self - professional quality and standards called Core Technical (CT). Under
employed persons, papad workers, for better corporate governance. Core Applications (CA) leveL, two
rickshaw pullers and auto drivers, practical examinations of intense
primary milk producers, salt growers, The need of expertise of actuarial nature tests the modelling and
safari karmcharies, tendu leaf professionals has also been felt in communication skills of the student
collectors, seri culture (silk farming), organizations which deal in long along with an extensive paper on
forest workers, power loom workers, term finances. Actuaries can be Actuarial Risk Management. At
toddy tapers, hilly area women etc. useful in assessing the risks and Specialist Technical (ST) and
quantifying those risks. In Banks, for Specialist Applications (SA) levels
Insurance sector manages these example in managing credit risks, the principles introduced at CT and
schemes and Actuaries role is pricing asset liability management and also CA level are applied at high levels.
the product, to ascertain the funds analysis of the non-performing assets The ST and SA level examinations
needed, analyse the experience, in line of persistency analysis in offer choice to a student as to what
keep reserves, monitoring insurance companies will change the areas he/she can choose for the
experience of scheme/products, perception of banking if actuaries career, viz., life insurance, general
maintaining solvency and assessing are involved. There are many such insurance, pensions and other
sustainability in longer run and scenarios in the market where employee benefits, investment and
ascertain when GoI support needed. actuaries have a big role. The market Risks. Students are trained in
may utilise Actuaries and other general business management
Future Prospects for the Actuarial actuarial professional services for though the actual experience they
personnel their financial management. The gain once in the real world. The
The development in artificial insurance sector shall see the risk Institute of Actuaries of India (IAI)
intelligence, genetic engineering, based capital regime and there is the only Institute established
super computers, power of analyzing would be need of more actuarial under Actuaries Act 2006 which
huge data and information spread on personnel in traditional insurance regulates the Actuarial Profession
social media, robotics etc, have and pension areas. Government of in India. The readers may visit IAI
raised questions on existence of India also utilise services of actuaries web-site www.actuariesindia.org.
the Actuary India February 2018 08
PRESS COVERAGE
th
19 Global Conference of Actuaries
Press Coverage published in print and online media as on date 1st February 2018
PRINT COVERAGE
Publication: Financial Express
Date: 31 January 2018
Headline: IRDA for more players in general insurance, to give new licenses
Page No.: 11
the Actuary India February 2018 10Publication: Asian Insurance Post
Date: 30 January 2018
Headline: Life insurance industry premium inflows at 6 Lakh crore, assets touch ` 35 Lakh cr in 2017:
IRDAI Chief
Link: http://www.asiainsurancepost.com/life-news/life-insurance-industry-premium-inflow-
exceeds-6-lakh-crore-assets-touch-rs-35-lakh-cr-2017irdai-chairman
Life insurance industry premium inflows at ` 6 Lakh
crore, assets touch ` 35 Lakh cr in 2017 : IRDAI Chief
Vijayan who is retiring in February 2018 considers improving insurance
penetration as an unfinished agenda in his tenure. Considering there is less
than 3 per cent penetration in India and almost 7 per cent globally, it indicates
a huge potential for Insurance in the coming years. We have seen insurance
penetration go up, especially with schemes like Fasal Bima Yojana, Jeevan
Jyoti Bima Yojana and Suraksha Bima Yojana. But it is still very low, especially
in the general insurance sector and still has a lot of area to cover,”
Jan 30, 2018 Indian News >> Life-News Source: AIP News Bureau
(L to R) K.S. Gopalakrishnan, CEO RGA India, T S Vijayan, Chairman, IRDAI at the
th
19 Annual Global Conference of Actuaries on Tuesday in Mumbai.
Mumbai:
TS Vijayan, chairman, IRDAI has said the Indian lfe insurance industry has mobilised ` 6 lakh crore
premium and its assets have touched ` 35 lakh crore in 2017.
the Actuary India February 2018 11The Indian life insurance industry recorded a premium income of ` 418476.62 crore during 2016-17 as
against ` 366943.23 crore in the previous financial year, registering a growth of 14.04 percent (11.84
percent growth in previous year).
Vijayan who is retiring in February 2018 considers improving insurance penetration as an unfinished
agenda in his tenure. Speaking to reporters on the sidelines of the two-day Annual Global Conference of
Actuaries (GCA) on Tuesday in Mumbai, Vijayan said that while penetration is improving, they is a lot of
room for improvement.
“Considering there is less than 3 per cent penetration in India and almost 7 per cent globally, it indicates
a huge potential for Insurance in the coming years. We have seen insurance penetration go up, especially
with schemes like Fasal Bima Yojana, Jeevan Jyoti Bima Yojana and Suraksha Bima Yojana. But it is still
very low, especially in the general insurance sector and still has a lot of area to cover,” he said.
Talking about the other upcoming challenges for the industry, Vijayan pointed out that it would be the
movement of the insurance sector into the new International Financial Reporting Standard (IFRS)
standards. Apart from this, he said that technology could bring about sweeping changes to the industry
and that they should be equipped to deal with it.
“Some discussions were going on consolidation, but no such proposal has been taken as yet. Few licenses
are pending with us in non-life, health and reinsurance. But I can't tell you the Number,” he said..
Speaking on the conference, GCA Organizing Group Chairperson, Kailash Mittal said, “The Indian
insurance market is slowly reaching an excellent balance between open market competition and
regulatory control. This move has helped equip the actuarial sector in India to implement practical
approach to systems like product design and pricing, sensible policyholder protection rules, minimum
training and licensing requirement for agents, maximum commission levels, valuation regulations and
minimum solvency margins etc.”
Among the key points discussed at the two-day conference are: Digital transformation of Insurance
Experience, Strategy and analytics in Insurance.
FAREWELL
Nirmala Mudliyar had been a part of IAI family
for more than Five years. She had been working
as Sr. Executive- Examination. During her
tenure in IAI, she was found very sincere,
hardworking and cooperative with each one.
We wish her great success and happiness for her
future ahead.
the Actuary India February 2018 12Publication: financialexpress.com Date: 31 January 2018 Headline: IRDA for more players in general insurance, to give new licenses Link: http://www.financialexpress.com/market/irdai-for-more-players-in-general-insurance-to- give-new-licences/1037098/lite/ Irdai for more players in general insurance, to give new licences Even as life as well as non-life insurance industry have registered positive growth in the last few years, a lot needs to be done, especially in the general insurance space, insurance regulator Irdai said on Tuesday. By: FE Bureau January 31, 2018 4:20 AM In order to further boost the insurance sector, the Insurance Regulatory and Development Authority of India (Irdai) is set to give new licences to various players in non-life, health and re-insurance. Even as life as well as non-life insurance industry have registered positive growth in the last few years, a lot needs to be done, especially in the general insurance space, insurance regulator Irdai said on Tuesday. In order to further boost the insurance sector, the Insurance Regulatory and Development Authority of India (Irdai) is set to give new licences to various players in non-life, health and re- insurance. “Today compared to many other countries, our penetration as well as growth is good. But a lot needs to be covered, especially in the general insurance sphere. The penetration can be much higher than the current level,” Irdai chairman TS Vijayan said at the 19th Annual Global Conference of Actuaries on Tuesday. Vijayan also added that many people came under under Pradhan Mantri Fasal Bima Yojana (PMFBY) and Pradhan Mantri Jeevan Jyoti Yojana (PMJJY) and this itself shows that there is demand for insurance and right products like this should contribute to the growth of the sector. This year, only life insurance has seen ` 35 lakh crore asset and ` 6 lakh crore premium the Actuary India February 2018 13
Publication: Moneycontrol.com
Date: 30 January 2018
Headline: Tech changes biggest challenge for insurance industry, says, Irdai chairman TS Vijayan
Link: http://www.moneycontrol.com/news/business/tech-changes-biggest-challenge-for-insurance-
industry-says-irdai-chairman-ts-vijayan-2495329.htm
Jan 30, 2018 10:05 PM IST | Source: PTI
Tech changes biggest challenge for insurance industry,
says, Irdai chairman T S Vijayan
Faster changes taking place in the world of technology and new capital
standards are going to be major challenges for the insurance industry going
forward, Irdai chairman TS Vijayan today here said.
Faster changes taking place
in the world of technology
and new capital standards
are going to be major
challenges for the insurance
industry going forward, Irdai
chairman TS Vijayan today
here said.
"The way the capital is going
to run is going to affect the
industry. The challenge for
the insurance profession will
be the changes in the
technological environment.
"Adoption of new capital standards and adoption of new technology are going to be major challenges for
th
the insurance industry," Vijayan told the two-day 19 annual global actuaries conference here.
India Union Budget 2018-19 Live: News, updates and highlights from FM Arun Jaitley's Budget 2018 speech,
announcements
The insurance regulatory and development authority chairman further said, the main duty of an actuary
is to maintain solvency for the insurer at all times while staying within the domestic and international
best practices.
"Analysis of the current data leading to projections for future makes this conference a platform truly
looking through the crystal ball. This year, only life insurance has seen ` 35 trillion asset building and ` 6
trillion premium has been collected.
"That there is only under 3 per cent insurance penetration in the country against the global average of
almost 7 per cent, indicates the huge growth potential for the sector in the coming years in the country,"
the chairman added.
the Actuary India February 2018 14Publication: Moneycontrol.com Date: 30 January 2018 Headline: Improving penetration remains unfinished agenda: IRDAI chairman T S Vijayan Link: http://www.moneycontrol.com/news/business/economy/improving-penetration-remains- unfinished-agenda-irdai-chairman-t-s-vijayan-2495155.html Jan 30, 2018 08:00 PM IST | Source: Moneycontrol.com Improving penetration remains unfinished agenda: IRDAI chairman T S Vijayan Insurance penetration in India rose to 3.49 percent from 3.40 percent in Fy17 Moneycontrol News@moneycontrolcom Insurance Regulatory and Development Authority of India (IRDAI) chairman T S Vijayan who is retiring in February 2018 considers improving insurance penetration as an unfinished agenda in his tenure. Speaking to reporters on the sidelines of the Annual Global Conference of Actuaries in Mumbai, Vijayan said that while penetration is improving, they is a lot of room for improvement. “ We h a v e s e e n i n s u r a n c e penetration go up, especially with schemes like Fasal Bima Yojana, Jeevan Jyoti Bima Yojana and Suraksha Bima Yojana. But it is still very low, especially in the general insurance sector and still has a lot of area to cover,” he said. Insurance penetration, which is measured as a percentage of premiums to gross domestic product (GDP), rose to 3.49 percent from 3.40 percent in FY17, according to a report by global reinsurer Swiss Re. Life insurance penetration stood at 2.72 percent while general insurance penetration stood at 0.77 percent. India Union Budget 2018-19 Live: News, updates and highlights from FM Arun Jaitley's Budget 2018 speech, announcements Insurance density or the premium per capita stood at USD 59.7 in India in FY17. The average for Asia stood at USD 343.1 while the global average was USD 638.3. the Actuary India February 2018 15
Publication: Indilens.com Date: 30 January 2018 Headline: Improving penetration remains unfinished agenda: IRDAI chairman T S Vijayan Link: https://indilens.com/472062-improving-penetration-remains-unfinished-agenda-irdai- chairman-t-s-vijayan/ Improving penetration remains unfinished agenda: IRDAI chairman T S Vijayan Publication: Safaqana.com Date: 30 January 2018 Headline: Improving penetration remains unfinished agenda: IRDAI chairman T S Vijayan Link: https://www.google.co.in/url?sa=t&source=web&rct=j&url=http://in.shafaqna.com/EN/065 44365&ved=2ahUKEwj2qMf9m4HZAhVBPY8KHePjAdEQFjAFegQIAxAB&usg=AOvV aw3hnGMLdhwfQ9BT QokoAidz the Actuary India February 2018 16
Publication: outlookindia.com Date: 30 January 2018 Headline: Tech changes biggest challenge for insurance industry: Vijayan Link: https://www.google.co.in/amp/s/www.outlookindia.com/newsscroll/amp/tech-changes- biggest-challenge-for-insurance-industry-vijayan/1242325 THE NEWS SCROLL 30 JANUARY 2018 LAST Updated at 8:39 PM Tech changes biggest challenge for insurance industry: Vijayan Mumbai, Jan 30 Faster changes taking place in the world of technology and new capital standards are going to be major challenges for the insurance industry going forward, Irdai chairman TS Vijayan today here said. "The way the capital is going to run is going to affect the industry. The challenge for the insurance profession will be the changes in the technological environment. "Adoption of new capital standards and adoption of new technology are going to be major challenges for the insurance industry," Vijayan told the two-day 19th annual global actuaries conference here. The insurance regulatory and development authority chairman further said, the main duty of an actuary is to maintain solvency for the insurer at all times while staying within the domestic and international best practices. "Analysis of the current data leading to projections for future makes this conference a platform truly looking through the crystal ball. This year, only life insurance has seen ` 35 trillion asset building and ` 6 trillion premium has been collected. "That there is only under 3 per cent insurance penetration in the country against the global average of almost 7 per cent, indicates the huge growth potential for the sector in the coming years in the country," the chairman added. the Actuary India February 2018 17
th Photo features of 19 Global Conference of Actuaries the Actuary India February 2018 18
the Actuary India February 2018 19
Publication: Indiatoday.in Date: 30 January 2018 Headline: Tech changes biggest challenge for insurance industry: Vijayan Link: https://www.google.co.in/url?sa=t&source=web&rct=j&url=https://www.indiatoday.in/pti- feed/story/tech-changes-biggest-challenge-for-insurance-industry-vijayan-1157789-2018-01- 30&ved=0 ahUKEwiomMT9moHZAhVEMY8KHR22AWwQqQIIIygAMAA&usg=AOvVaw2hS_De2hGou59tMU8hFci8 Tech changes biggest challenge for insurance industry: Vijayan PTI January 30, 2018/ UPDATED 20:45 IST/ Mumbai, Jan 30 (PTI) Faster changes taking place in the world of technology and new capital standards are going to be major challenges for the insurance industry going forward, Irdai chairman TS Vijayan today here said. "The way the capital is going to run is going to affect the industry. The challenge for the insurance profession will be the changes in the technological environment. "Adoption of new capital standards and adoption of new technology are going to be major challenges for the insurance industry," Vijayan told the two-day 19th annual global actuaries conference here. The insurance regulatory and development authority chairman further said, the main duty of an actuary is to maintain solvency for the insurer at all times while staying within the domestic and international best practices. "Analysis of the current data leading to projections for future makes this conference a platform truly looking through the crystal ball. This year, only life insurance has seen ` 35 trillion asset building and ` 6 trillion premium has been collected. "That there is only under 3 per cent insurance penetration in the country against the global average of almost 7 per cent, indicates the huge growth potential for the sector in the coming years in the country," the chairman added. PTI SM BEN This is unedited, unformatted feed from the Press Trust of India wire. Publication: Newsboss.in Date: 30 January 2018 Headline: Improving penetration remains unfinished agenda: IRDAI chairman T S Vijayan Link: https://www.google.co.in/url?sa=t&source=web&rct=j&url=http://newsboss.in/ly/Rt7w32/ Improving-penetration-remains-unfinished-agenda-IRDAI-chairman-T-S-Vijayan&ved=2ahUKEwj2qM f9m4HZAhVBPY8KHePjAdEQFjAGegQIBRAB&usg=AOvVaw1CIVugoJxUOrJGhdm0w1-L the Actuary India February 2018 20
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the Actuary India February 2018 22INTERVIEW
Interaction with Chairman of
Life Insurance Corporation of India
Introduction-Journey to the most
coveted position in LIC
Shri Vijay Kumar Sharma took
charge as Chairman of Life Insurance
Corporation of India on 16 t h
December, 2016. Prior to his taking
over as Chairman, he was Chairman
(In charge) from 16th September, 2016
and Managing Director from 1st
November, 2013. From December
2010 to November 2013, he was
Managing Director & CEO of LIC
Housing Finance Ltd., a premier
housing finance company in the
country which is listed in NSE, BSE &
Luxembourg Stock Exchange. Shri
Sharma has held various challenging
assignments pan India and in all
operational streams including in-
charge positions at different levels.
Working across the length and quality and perfection, which successful in all the situations. I
breadth of the country has added becomes a weakness. But I have to would like to put the three turning
immensely to his experience and live with it. around points in my life which gave
honed his understanding of me the strength to serve people –
demographics of the country, socio- (i) challenge to lead Southern Zone
2. What different activities than
economic needs of different regions of Life Insurance Corporation of
life insurance you are interested
and multi-cultural challenges in India covering Tamilnadu, Kerala
in?
implementation of Corporate and Pondicherry as Zonal Manager
objectives. where neither I have worked nor I
All along my life – when I was a
student, I used to dream about so had the strength of language or
1. Your strengths and weaknesses? knowledge of people and the Zone
many things including planet earth
green cover (conservationist), was under morass of continuous de-
By destiny, it is an excellent match of planting as many trees as I can growth of six quarters and all
Organisation's value and culture, (forestry) and many more things. industrial unrest associated with it.
with my personal values and beliefs. After joining LIC, I have been eating, The turn around came in two years
I consider it as the biggest strength. breathing and living life insurance and it became No. 1 zone in the
My trust on people and their intuitive 24*7. However, I have kept a passion country by November 2010; (ii)
response towards me has also been of gardening, listening music, yoga taking over of LIC Housing Finance
one of the major source of my and prayers which is continuing with Ltd. at 24 hours notice in the most
strength. My passion to serve people me till date. challenging circumstances of
at large has helped me to fit in the negative media glare and intense
Organisation and grow along with it. scrutiny by Regulator & CBI, and
3. What was the biggest challenge within three years time, the
you faced in life? Company came out like a pure
I am candid enough to accept that I
am also like any ordinary person who Gold and won the best Housing
When I look back to my professional Finance Company Award; (iii) being
has many weaknesses. With respect
journey all along, I have been given the responsibility of leading
to the Organisation in particular, I am
branded as the “crisis manager” pan Life Insurance Corporation of India
very impatient in the matter of
India across all the jobs. I am in difficult circumstances with a
delivering all results and timeline.
thankful to people who have been challenge to put it back on growth
Many a times, I feel being stickler to
with me and who have made me
the Actuary India February 2018 23path and re-establish its market 7. How do you see actuaries services sector wherein every
leadership. taking Business roles in Life segment is doing everything,
insurance companies? What keeping the differentiation as a
I cannot claim how I have done, but I values can they add to the segment – is one of the biggest
am happy that we have been fairly business in the area of Sales and challenge to life insurance now.
successful in getting love and Marketing? Equally challenging for life
appreciation all round. insurance industry is to stay
Actuaries with their keen analytical relevant and significant to the
Profession thinking and statistical skills may society particularly in the mind
foresee business opportunities in space of younger generation. For
the markets resulting from changes this, Insurers need to evolve and
4. How is your typical day in the combine a recalibrated distribution
office? in economic landscape, geopolitical
shifts, new technologies, shortened system, adapt technology that will
product life cycles, cross-cultural reach out to people and improve
Equally distributed among people, communications and changing the qualitative aspects of products
files and strategy lab. consumer behaviour. This will help and services. Other challenges
us align our corporate strategy include competition with mutual
5. How do you value actuaries in accordingly for long-term success in funds and declining and aging
your organization? the global marketplace. agency force.
As an Organisation, we are proud that 8. How do you see employment 1. What trends do you see for
it could be built on such a sound opportunities for our members, this industry in the next 3 to 5
footing due to the contribution of our including student members in all years?
Actuaries in the past. LIC has been functional areas of LIC?
blessed as it has many Actuaries not I have been talking on public
only in actuarial position, but other The opportunity is huge. There will platforms that coming decade is
areas of operations as well including always be need for actuarial going to be very positive for
the highest position. Many of them professionals in every segment of insurance business – be it Life,
have left the Organisation for quite Insurance business. Actuaries are General or Health. It will be led by
sometime. Therefore, a culture is valued for their expertise in products, technology and
built wherein the appreciation of identifying behavior and attitude in distribution capability of the
specialized knowledge, talent matters related to money companies.
development and providing management, planning for future
conducive environment for their and choosing of products. And using 2. What market share do you see
growth and development. We have this expertise in designing the the private sector players
conscious policy of exposing out products for any company is having in ten years' time?
actuarially qualified people to definitely the need of the hour.
different areas of operations
including marketing and investment In a country where hardly 10% of
so that they can be groomed to the This will surely be a deciding factor the population is covered and less
leadership position for the industry. for life insurance companies to than 3% are covered adequately, it
engage people in sales and is meaningless to talk about market
marketing roles and leading from the share. The potential of insurance
6. What impact do actuaries have front to generate business. market of India is so huge that
on consumers and society? What there is a space for many more
should they do to connect with companies to operate and succeed.
the society? LIC is regularly and actively
absorbing people with actuarial skills The insurable population is
at different levels. It will continue expected to be 750 million by 2020
Actuaries are very vital component to do so more in view of the turn and life insurance coverage is
for long term financial stability in the around of insurance sector and the barely defined as 30-35% of
global and national economy. Their future growth of business in medium insurable population. The market is
ability to visualize and guide for long and long term. going to expand substantially due
term future risk management is to growing awareness, Government
critical for insurance companies in initiatives, higher literacy and
particular and the financial system in Insurance Industry in India
competitive market play. We, in
general. They are also able to create LIC are preparing ourselves to keep
hope for the future and aspirations What do you feel as the biggest the leadership sustained.
for risk averse segment of the society. challenge of life insurers now?
Having said that, there is a very
In the mix up of entire financial
the Actuary India February 2018 24bright future for the new insurance 4. What do you think are the 5. How do you plan to meet the
companies who are serious players. strengths of Indian Insurance future challenges and
Industry? opportunities in the Insurance
3. What do you believe are the industry?
inefficiencies in the insurance Deeper and Mature insurance sector
industry? How do you think such will stimulate economic growth and Our records of six decades show that
inefficiencies can be overcome? facilitate savings which will be we have time tested blueprints for
made available for investments in achieving excellence in
We do have a strong foundation as various sectors. So the role of the performance. But having said that,
far as insurance industry is insurance industry is multi pronged. we are aware that in today's fast
concerned. However, one has to It reaches out to the individual changing environment, what worked
keep in mind the changing dynamics financial security as well as social in the past may not be sustainable in
of the customer base, their needs and economic growth of the the future. What we need are ground
and a new approach to tap them. country. breaking innovations to lead us on
the path to excellence, a need for
Technology has always been an I would say that we have a very disruptive innovations as a means to
important link in the evolution of strong foundation as far as justify the end of achieving
the industry; we have to be sensitive insurance is concerned but we have excellence in performance.
to the peculiar nature life insurance to expand our reach beyond the
in particular. Human touch in life realms of pure profitability. If the If we just move with times, hold on to
insurance industry cannot be last person has access to insurance our customers and add the new ones,
eliminated but it has to be highly and is secured, then we have a build a sturdy dedicated
skilled and customer oriented now. I secure society and a secure country administrative and marketing
would say it's an ongoing process and financially to a great extent. And personnel team and be ahead of
disruptions do lead to innovations. this responsibility has to be shared technology curve, there is no
among all the players. stopping us, say for another 60 years.
the Actuary India February 2018 25AG UPDATE
Advisory Group on Health Care Insurance
Health Insurance in India is growing a proposal to organise five-day and improvement to existing
at a healthy rate of 25% year-on-year. seminar to impart training to fresh products by adding innovative
This growth rate is expected to actuarial students covering practical features. We make sure that in
continue for many more years aspects of actuarial domain to help every seminar few sessions are
because the penetration of voluntary them rise the learning curve fast. dedicated to innovation.
individual health insurance products
is still abysmally low when compared Currently Health Care Advisory Apart from all positives, industry is
to other developed countries. The Group is also working on two also facing few challenges, like
number of Standalone Health technical papers. Topic of first paper high cost of distribution,
Insurance Companies is also on the is to propose a detailed methodology unsustainable loss ratio of group
rise and lot of new players have to compute Medical Inflation Index. health, high management
evinced interest in this growing but Once Medical Inflation Index is in expenses, etc. As Health Care
still under-penetrated segment. As place it can be used in many areas Advisory Group we have raised such
per latest Annual Report of IRDAI including but not limited to premium issues at appropriate forum and
there are some 3.2 Crore members adjustment. Second topic is to cover suggested ways to deal with them
who are covered by voluntary technical aspects of Health Saving in the past and would like to
individual health cover and these are Account (HSA). This is a very continue doing this in future.
almost evenly split between successful product globally and given
individual and family floater sum the saving bent of mind of Indian There are lot of disruptive business
insured policies. Given India's population it can be even more models emerging around us in all
population this number seems to be successful in India. This may also industries using digitisation and we
miniscule and there is so much help in increasing penetration of feel that we can take some learning
potential for this to grow further. health insurance in India. from there to overcome some of
Advisory Group on Health Care our challenges, like, cost of
Insurance of Institute of Actuaries of Another important feature of Health distribution and high management
India is involved in number of Insurance Industry in India is product expense. We would like to engage
activities to help promote Health innovation. In last few years, more in this aspect in future.
Insurance. We have recently Industry has seen many new products
organised two-day seminars on
Capacity Building and Current Issues About the Author
in Health Insurance in Gurgaon. Both
the seminars were taken very well by
the audience and basis the success of
the event it was decided to organise
Mr. Vishwanath Mahendra
one full day workshop dedicated to Chairperson, Advisory Group on Health Care Insurance
the pricing of health insurance
products. Apart from this there is also
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the Actuary India February 2018 26FEATURES
Introduction to Machine Learnings for Actuaries
Introduction systematically in our database. increases.
When we are born, sensors of our Thanks to the advanced
body- eyes, ears, nose, tongue, and development of computer Following are broad steps which
nerves—are continuously battered technology. are followed in Machine Learnings:
with raw data that our brain
translates into sights, sounds, smells, In this article, we are going to (i) First step is to train the
tastes, and textures. Using understand about Machine machine based on available data.
communication, be it verbal or non- Learnings, types of machine Now available data can be
verbal, we are able to share these learnings and application of machine partitioned as-training dataset and
experiences with others. learnings in insurance and actuarial test dataset.
context.
We, first observe the events, receive (ii) Suitable model is adopted
the raw information and data; then What is Machine Learning? based on various features
we record these in our brain. Our Machine Learning is the field of embedded within training dataset.
brain processes this raw data and study, where sophisticated computer
instructs us to take an appropriate algorithms are developed for (iii) Then adopted model is
action. At the end, we take action transforming data into intelligent checked on test data set for
and closely watch the implication of action. comparing predicted outcome from
our action. This brings us more the model with reference to actual
insight; we start learning more, In other words, Machine Learning outcome available in the test data
become smarter. Also we refine and teaches computers (or machines) to set.
enhance our thinking process before do what comes naturally to the
taking appropriate action on similar minds of human beings; learn from (iv) If predicted outcomes are
type of circumstances next time. It is experience. In other words, machine satisfactory (based on various
said that 'We learn more when we fail learnings algorithms use statistical test, we can check
more number of times'. computational methods to “learn” whether model is satisfactory or
information directly from data not) for the test dataset, then we
This is analogy with our Actuarial without relying solely on a can adopt the same model for the
Control Cycle-Specify the Problem, predetermined equation as a model. new set of data for prediction of
Develop the Solution and Monitor the outcome from those data.
Experience in the context of the The algorithms adaptively improve
general economic and commercial their performance as the number of Process flow of Machine Learning is
environment along with samples available for learning depicted in the following diagram:
professionalism.
A classic example is when a baby is
small, she does not know the dangers Training DataSet
of fire. First time, she puts her finger
boldly into it, experiences the
burning sensation and immediately
removes her finger. Moreover, her
brain stores this information and
trains her that next time she should
Machine Learning
be careful and not be putting her Algorithms
finger into the fire. That means, baby
has learned with experience that fire
is dangerous and now she is able to
take decision of not putting her
finger if she sees any fire.
New Dataset Model Prediction of
Today we are able to record, store Outcome
and process millions of observations
the Actuary India February 2018 27Application of Machine Learning
Machine learning algorithms discover
Machine
data patterns that generate insight
Learning
and help to make better decisions
and predictions.
They are used to make critical
decisions in medical diagnosis,
algorithmic trading, energy
Supervised Unsupervised
production, purchasing behaviour of Learning Learning
customers, credit scoring, detection
of cancer tumour, discovery of
drugs, automotive, aerospace,
prediction loan default, image
processing etc.
In insurance context also, we can see Regression Classification Clustering
many applications of machine
learning such as
1. Predicting the persistency rates of
a life insurance policies
Linear Nearest K means
Regression Neighbour Clustering
2. Prediction of mortality and
morbidity rates based on various
factors such as policyholders'
behaviour in terms of age, gender,
eating habits, level of exercise,
occupation, income level, social
Regression Gaussian
habits etc. Naive Bayes
Mixture
Trees
3. Predicting the heart attack cases
of insured life in the next one year
say for the Health Insurance
Companies.
Model Trees Decision Trees Hidden Markov
4. Identifying and separating the Model
most important factors in the
mortality and morbidity study and
taking appropriate underwriting
decisions based on emerging
experience.
Ensemble Discriminant Hirarchical
Methods Analysis
5. Detecting the fraudulent claims
and drivers behind the fraud.
6. Estimating the medical treatment
cost based on age, gender, BMI,
smoking status, geographical Support Vector Support Vector Neural
location, level & type of food Machine Machine Networks
intake, level of exercise etc.
7. Predicting insurance claim for each
driving person based on various
factors such as make & model of Neural Neural
car, distance travelled, daily Networks Networks
travel journey time, daily number
the Actuary India February 2018 28You can also read
