2007 General Meeting Assemblée générale 2007 Montréal, Québec

1. Canadian Institute of Actuaries L’Institut canadien des actuaires 2007 General Meeting Assemblée générale 2007 Montréal, Québec

2. IP-23 The Non-Traditional Actuary: A Non-Endangered Species 2007 General Meeting Assemblée générale 2007 Montréal, Québec

3. Non-Traditional Actuaries • More and more actuaries working in various roles other than the traditional pricing, valuation and corporate functions

4. Quizz • How many members of the CIA show “Non-traditional actuarial work” as their practice area in the on-line directory? • 75 • 175 • 275 • 375 • None of the above

5. Non-Traditional Actuaries • We will examine: • how we became non-traditional actuaries • what our jobs are all about • how our actuarial background comes into play in our role

6. Jean Roy David Forest Financial Services 2007 General Meeting Assemblée générale 2007 Montréal, Québec

7. Non-traditional actuary In short, • First 15 years • Last 1.5 year

8. First 15 years • Started in a small life insurance company • Lasted 2 years • Product and special quotations/illustrations on life and money products • Product pricing & development • Phone calls from the distribution force • Stats geek • Federal government pull the plug on December 21, 1992 • Was eventually bought by a larger company

9. First 15 years • 13 year experience in a large scale company • Work on integration of the small company. • Allowed me to meet senior people in the organization early in my career. • Pricing and marketing of life insurance products • Systems: computer based and mainframe • Compliance / Ombudsman • Contracts / Reinsurance treaties • Support to Client Services

10. First 15 years • 13 year experience in a large scale company • Lead policy customization unit for 5 years on a national basis. • Actuarial life insurance at start • Developed expertise in large case market • Added annuities and all money products later • Then Sales Support team too • Lead product development and management unit. • Life, CI and annuities

11. Non-traditional: Why not? • Entrepreneurship side always fascinated me • Was raised in a family business • Practical aspect of life insurance too • Who buys the stuff? • Why do they buy it? • Technical knowledge has to be of value • Problem solving • Different approach in analysis • Overall, will I add value or only cost?

12. New role since June 2006 David Forest Financial Services • Life insurance oriented shop • Bits of CI, DI, Annuities & money products • Operate in the Montreal market • Bits in Ontario • Target market • High Net Worth (HNW) and Ultra HNW • Bits in family market

13. David Forest Financial Services Operational side • People management: 7 people to manage • Lots of skills learned in the life companies are useful • Coaching • Help people to improve work methodology, autonomy. • Another person to talk to when facing a problem • Internal procedures and process • This firm was already well organized

14. David Forest Financial Services Operational side • Quality control • Problem solving • Handle difficult clients • Enhanced credibility of the firm Indirect help to David • He can better focus where he should

15. David Forest Financial Services Technical / New Business side • Analyze all products, services and concepts available in the market • Features, risks, competition • Similar to what I was doing in the insurance company but can now better understand the market • Actuarial knowledge is a very useful tool • Develop or articulate concepts • Actuarial knowledge is a very useful tool here too

16. David Forest Financial Services Technical / New Business side • Optimization of in-force policies • Analyze existing policies for new prospects • e.g., Rule of 250% in UL • Show a different approach from competition • Participate in sales meeting • Meet client, answer questions • Do all the support with the accountant, tax lawyers or whoever the client appoints to do their due diligence

17. Before & After: The Differences • Independent • Find the best from the market instead than the best from my insurance company • Lot less bureaucracy • 0 or 1 person to go for approval • No one to blame if you fail • Mistakes has direct hit to the bottom line • Fully accountable • Fewer people you can turn to • Can’t walk in Legal dept for free advice

18. Before & After: The Differences • More time for analysis • Management tasks are minimal • Very little time to react • Less control on your daily agenda • 25 to 35 emails a day instead of per hour • Credibility building • Client sees you for the first time; You need to build from scratch with every new person you meet

19. Before & After: The Differences • Client satisfaction or dissatisfaction has a direct impact on your results. • More room for creativity • Your opinion really counts

20. In conclusion • Takes a bit of courage to get out of the comfort zone • Give you a broader view • No risk, no new results • Staying in your zone may have some risks, what if it disappear? • Follow your business instinct

21. François CarrierSEI Investments 2007 General Meeting Assemblée générale 2007 Montréal, Québec

22. Actuaries in non traditional roles • Actuarial careers in 1980 • Six Employers (and counting?!) • Current Employment

23. Actuarial Careers in 1980

24. Six Employers (and counting?!) • MET • BELL • ABN AMRO • KBSH • AON • SEI

25. Current Employment

26. Financial Management Assessment • Goal: • Elevate the importance of the pension plan in corporate context. • Do so by providing quantifiable examples of the value-add of Firm’s advice process and investment solution. • Data collected: • 2 recent actuarial valuation reports • Recent investment report • Financial statements (if private) • Output: • Modeler • Investment observations and performance comparison • Pension observations and portfolio “recommendations”

27. Establish Goals 1 StrategicAdviceProcess Manage & monitor progress towards goals Identify, quantify and prioritize risks 4 2 3 Developoptimal risk management strategy Advice Role

28. Relationship Management: Owner of the client experience • Development and execution of a written account strategy for each client. • Deepening and broadening the clients’ experience (fostering and developing multiple contact points at the client). • Continue to establish the Firm’s point of view; Utilization of multiple metrics for evaluation. • Provide investment advice. • Grow the business: additional products, develop referrals, additional assets. • Improve client rating of Firm.

29. Jean-François LerouxAssistant Vice President, Actuarial Consultant Manulife Financial 2007 General Meeting Assemblée générale 2007 Montréal, Québec

30. How Did I Get There? • Worked in Group Insurance in Ottawa • Worked in Reinsurance pricing, marketing, valuation in Montreal and Toronto • Position of Actuarial Consultant created in 2000

31. Actuarial Consultants • Experienced actuaries • Focused on assisting high-end advisors • Support is channel neutral • Focus on new business

32. What Attracted Me? • Change in focus • Developing a new position • Using my teaching and presentation skills • Becoming a key resource person • Being on the line of fire!

33. Professional Services Team Want to be recognized as the company with the most knowledgeable and professional sales support • Actuarial consultants • Underwriting consultants • Tax & Estate Planning consultants Work in tandem to give the company a competitive advantage

34. Part of a Team... The Team!!! Product Manufacturer Actuarial Consultant Underwriting Consultant Tax & Estate Planning Consultant Wholesaler Distribution Centre

35. Structure • Actuarial Consultants located in regional offices • Montreal, Toronto, S/W Ontario, Winnipeg, Vancouver (vacant) • Back-up team in Head Office • Marketing specialists • National consulting actuary

36. Skills Needed • Extensive experience in pricing and product development • Strong relationship manager • Excellent communicator • Ability to take the complexity out of complex issues • Exceptional presentation skills

37. Skills Needed • Knowledge: • insurance and tax legislation • tax and estate planning • financial services industry • underwriting and issue process

38. Actuarial Consultant Role Competition Analysis Case Work Support Continuous Education Actuarial Consultant CA/Client Meetings Professional Community Special Case Pricing

39. Other tasks • Assist in product launches • Actuarial resource for Legal Department • Involvement in complicated in- force business issues

40. What I like about this position • Diversity • Dynamic environment • Meeting clients and their professional advisors • Teaching role • Rapid feed-back • Constant learning

41. Challenges • Dealing with advisors and their ego! • Many files to deal with at the same time • Travel to meetings/presentations can be time-consuming • Need to think quickly on your feet

42. The Non-Traditional Actuary: A Non-Endangered Species “It is not the strongest species that survive, nor the most intelligent, but the one most responsive to change.” Charles Darwin (1809-1882)