As technology continues to evolve, the demand for actuaries with programming skills is on the rise. In this article, we will explore the benefits of learning programming for actuarial professionals, the most sought-after programming languages in actuary jobs, and how these skills can boost your actuary salary and job prospects. By the end, you will be better equipped to enhance your actuarial skills with programming and unlock new opportunities in your career.
Actuarial work has traditionally relied on advanced mathematics and statistical methods to evaluate risk and make financial predictions. However, with the growing importance of data-driven decision-making, programming has become an increasingly essential skill for actuaries.
Several decades ago, computer power was expensive, so a lot of actuarial work was done at an aggregated level in order to save on computing costs. As the cost of computers and technology has decreased, companies now have access to cheaper storage and more power machines.
Companies are also collecting lots more data about customers. Companies who can harness insight from their data will be able to make more accurate recommendations and drive better financial outcomes.
As AI becomes more prevalent in the next few years, this is likely to accelerate further as companies look to understand patterns in their data sets that can lead to better decision making through better underwriting and more accurate pricing.
By learning programming, actuaries can gain the ability to work with large datasets, automate complex calculations, and create more accurate models, making them indispensable in the industry.
Several programming languages are highly sought after in actuary jobs, each offering unique benefits and catering to specific needs within the field. Here, we discuss the top programming languages for actuaries.
SQL, or Structured Query Language, is a domain-specific language designed for managing and querying relational databases. While not a traditional programming language like R or Python, SQL is an indispensable tool for actuaries working with large amounts of data stored in databases.
Key features of SQL for actuaries
By incorporating SQL into your actuarial toolkit, you will not need to rely on others to pull data for you. Having access to data means that you can deliver insights that others cannot.
Learning SQL will allow you to effectively manage and interact with large datasets, enhancing your overall data analysis capabilities and increasing your value to employers.
R is an open-source programming language designed specifically for statistical analysis and data visualization. Its extensive library of statistical packages and user-friendly syntax make it an ideal choice for actuaries. By mastering R, you can conduct advanced statistical analysis, create insightful visualizations, and stay up to date with the latest advancements in actuarial science.
Python is a widely used, general-purpose programming language known for its simplicity, readability, and extensive library support. Actuaries can leverage Python's robust ecosystem of libraries like NumPy, pandas, and scikit-learn to manipulate and analyze data, build models, and implement machine learning algorithms.
Python can typically do a lot of the statistical analysis that R can but is also very good for automating tasks. Learning Python can open doors to new job opportunities and help you stay competitive in the field.
SAS is a powerful statistical software suite that has long been popular among actuaries for its data manipulation, analysis, and reporting capabilities. It is commonly used in academic circles and is sometimes seen in insurance companies too.
Though it may not be as versatile as R or Python, SAS remains an important tool for many actuaries, particularly in the insurance industry. Generally, SAS has been surpassed in the industry by R and Python although there are actuaries who still use this tool.
Actuaries who possess programming skills have a competitive edge in the job market. They are in higher demand due to their ability to automate complex calculations, develop and maintain actuarial models, and analyze large datasets. As a result, actuaries with programming skills often command higher salaries and enjoy a wider range of job opportunities outside traditional actuarial work, including roles in data science, predictive analytics, and risk management.
By learning programming languages, you can expand your actuarial skillset in various ways:
There are numerous resources available for actuaries who want to learn programming, including:
While not all actuarial roles require programming knowledge, it is becoming increasingly important in the field. Learning programming can help you stand out from the competition, enhance your skillset, and access a wider range of job opportunities.
The time it takes to learn programming depends on your existing experience, the specific programming language, and the amount of time you can commit to learning. Generally, actuaries can become proficient in a language like R or Python within a few months of dedicated study. Like learning a written language, if you are already proficient in a programing language, it can be much quicker to pick up a second or third.
The best programming language to start with depends on your goals and interests. R is a great choice if you are primarily focused on statistical analysis and data visualization, while Python is more versatile and can be applied to a wider range of tasks. SQL is also useful in allowing you to get hold of and manipulate data.
While there is no guarantee, actuaries with programming skills tend to command higher salaries and enjoy better job prospects. Developing programming expertise can make you more valuable to employers and open up new career opportunities.
Programming for actuaries is a valuable skill that can enhance your career by increasing your efficiency, expanding your job opportunities, and potentially boosting your salary. By learning popular programming languages such as R, Python, or SQL, you can stay competitive in the actuarial field and unlock new possibilities in your profession. Take advantage of available learning resources, network with fellow actuaries, and continue to develop your programming expertise to stay ahead in the ever-evolving world of actuarial science.
