Like doctors and lawyers, actuaries must pass a series of exams to gain status, standing and, ahem, salary in the workplace. Uniquely, however, actuaries may enter the field while they study for and take their exams, which can take years to finish. ValuePenguin interviewed a practicing casualty actuary who spent a decade on his.
"I got notification over email, I think, and I just took the rest of the day off," Hayden Burrus, the principal of HB Actuarial Services in Delray Beach, Fla., said of learning he'd passed his 10th and final exam at the age of 31. "I wasn’t at a company where I could celebrate with somebody else. So it was kind of anti-climactic. But most people really have a blow-out. It’s like a graduation party."
We asked Burrus more about his work before and after the achievement that is common to successful actuaries.
When you're asked what you do, what's your response?
I guess I start off by just saying I’m a consulting actuary. And I get a variety of reactions. Some people who have heard of the actuarial field before — because they might have worked with an actuary, or worked in the insurance industry — say, "Oh, you must be very smart." That’s one of them.
Probably three-quarters of the time, though, people say, "What’s that?" They’ve never even heard of it, and they ask for a little bit more detail. At a cocktail party, they don’t really want a heck of a lot of details, so I try to summarize it the best I can in a sentence or two. I say something along the lines of, "We forecast financial results for insurance companies."
Let's ask the questions that those people may not. Why did you choose this as your profession?
I’ve always been very good at math — naturally so — and I was majoring in mathematics in college. Around my junior year, I was working with my college’s career services department, trying to get an internship or figure out what I’m going to do with my life after I graduate. A match came up with an actuarial intern position in New York City. I had never heard of it until that internship popped up. The pay was as great or greater than I was going to make painting the dorm rooms — which was my alternate job that summer — and so I jumped on it. I enjoyed it because it used math and developed my computer skills, and was a good match for my talents.
At that time, the kind of advice that career services people gave was, "Do what you love and what you’re good at, and a job will come to you." To me, that’s awful advice, but that’s the advice that everybody got in those days. And I was doing that, and I guess I was starting to get a little nervous. But the internship saved the day, with it being interesting and high-paying as far as internships go. Most internships, many internships, don’t even pay anything.
What did you gain from the internship experience?
One of the things that I learned during that internship is there is a significant and very rigorous examination process. At the time there were 10 actuarial exams, each six months apart. The pass rate is 40%, meaning 40% of the people taking the exam pass; the rest fail. They’re very hard. My peer group — the young actuaries that were there, that I was meeting — they were telling me that it takes about 300 hours to study for an exam, and even after you’ve studied that much, you can’t really guarantee that you’re going to pass.
My attitude was, "Well, I’m very good at math, I’ve always been tops in math, I did well on the SATs on the math portion... I’m not like everybody else." But what I didn’t realize was, my competition all said the same thing. My competition wasn’t an average person; my competition were also other people who were good at math. So it was a very challenging process.
I like studying, and I like learning and growing as a person. This was a sure way to get raises and promotions. I really loved that certainty. If I passed the exam, I got a raise. I loved that when I was younger.
I went right out of college into the actuarial field, at age 21, and I hadn’t passed all my exams until I was 31. You’re getting job experience, too, and you’re getting raises. Many companies will pay for somewhere around 100 hours to let you devote to studying for your exam.
It’s not that your initial pay is poor; it just doesn’t get to be excellent until you’ve passed a bunch of exams. By the time I had passed my exams, I had moved to working for a consulting firm. I thought that was interesting, and consultants tend to make a little bit more, which I enjoyed. There’s a little bit higher stress, too, which I didn’t enjoy as much. I did that for a while. I got to be chief actuary of a small insurer at a relatively young age — I was, I think, 34. Not many people get that sort of opportunity, to be that high on the totem pole that young, but the fellowship really helps launch your career like that. That’s a very high credential, very difficult to get, and it can bring you into the boardroom earlier than you might otherwise get there.