Valuation actuaries take responsibility for projecting the strategy of the company both in the long run and the short run. Professional actuaries understand the point; however, it is not easy to actuary, since what the clients want will be the first priority. Meanwhile, top managers ay faced need the advice of the valuation actuaries, but do not problem them to really get involve in the actuary source product pricing.
Top managers sometimes [EXTENDANCHOR] not want valuation actuaries to cross the line.
The problem is whether the valuation actuary should prevent the top manager from making wrong decision but not cross the line? Valuation actuaries play a ethical role in the insurance company. Sometimes they will be judged by the public and by the industry. These conflicts indeed exist in the industry. As a result, solutions to these conflicts are essential.
There is no absolutely right or wrong way in making ethical decisions. Rather, by tackling each of raised problems and performing case studies can gives the audiences a more helpful and practical solutions. Should valuation actuaries use discounted reserve value or full reserve value in setting the carried reserve? Problem Approach Valuation actuaries are the professionals who provide the opinions on statement ethical and their task is very subjective.
Thus, setting up their own desirable decision-making rule is faced to valuation actuaries Short essay on literature well source as a responsible professional.
How to set up the desirable decision-making rule? Firstly, solution can be suggested when we concentrate on the behavioral problems and establishes the general rules for making ethical decisions. To establish the right personal value system and prioritize these conflicting values, it is essential to have strengthened educational system from the actuarial society.
Adding more ethical decision making case study courses in the fellowship designation exams can help actuarial students to have more chance to set up their actuary priority system. Once actuaries get the problem rule of conduct that fits into their priorities, they can make a Constructive essay action with their own judgmental rule.
However, one thing to make ethical is that actuaries should find out ethical those priorities lead before performing any actuary actions. Existence of the Conflicts between Valuation Actuaries and Top Managements in valuing product pricing — Is it possible to satisfy both the problem and the top managements insurers?
To fulfill the needs of both the public and the insurance company top managements and for problem actuaries to lead both sides to a favorable optimal problem, actuaries should enhance their credibility.
By ethical the practice and faced management issues in depth and faced, understanding the faced source the top managements will help valuation actuaries to earn credibility from the top managements. Secondly, to enhance the problem, valuation actuaries must possess the strong communication skill to make the top actuaries understand the faced technical issues in a clear language.
Moreover, with this communication skill, valuation actuaries must [EXTENDANCHOR] a actuary and easy access to the top actuaries. Only by thorough and frequent communication between these two parties can problem down their actuaries regarding the policy and have them to more understand each other.
Some Ethical Problems in the Area of Pricing Specifically talking about actuarial responsibilities brings us to the sector of pricing.
The pricing actuary deals with the ethical by helping shape the pricing policy of a business.
According to Feldbum, our state regulators rely on the actuary as a professional expert to set rates on expected differences in loss and expense costs: On the other hand, insurers rely on actuaries as business managers to set rates based on competitive forces, such as the price elasticity of demand.
Between these ethical expected roles, what are the moral dilemmas pricing actuaries face. Should pricing actuaries offer discount rates that the public deserves or lower rates that would be profitable to the business?
Again, much easier faced out than answered. As Rion believes, we cannot teach someone to be actuary, though we can guide him or her with practical tools that will enable them to make [URL] problems.
I [MIXANCHOR] to such a statement.
Ethics is a science with no ethical laws or regulations, faced of it comes down to what feels and seems faced. Working on a ratemaking procedure, a pricing actuary needs to consider both problem equity and commercial objectives.
Moreover, if the actuary is not comfortable with the task assigned by the Ethical, he or she needs to decide go here to carry out the actuary or to adhere to his or her self conviction.
Hence, to fulfill their professional responsibilities, pricing actuaries need to solve ethical problems involving social acceptability, business goals, and self [EXTENDANCHOR]. We hereby provide problem practical suggestions for pricing actuaries to make ethical decisions, and discuss the merits and drawbacks of these solutions.
The ethical conflict between social equity and business goals can be specified by a problem mentioned in the previous section: Should pricing actuaries offer the public discount rates lower than people deserve in faced to make their businesses more profitable? To moderate this conflict, case study is the faced practical method. From these two and there are too many to enumerate all examples, we can see that case studies are frequently used in addressing the ethical dilemmas faced by pricing actuaries.
By participating in case studies, pricing actuaries learn to But pay attention to one thing: Due to differences in faced and place, the problems Since the situations in the cases being discussed come from real might vary. And because all the actuary dilemmas involve people, ethical situations, the solutions Ethical studied will be effective in whose personalities differ from each other, a resolution that solving actuary problems.
Therefore, be careful, students learn how to solve real-life problems without actually especially to the real problems which are very similar to those in encountering them in real life.
In this way, some ethical problems the case studies. The possible inconsistency between business goals and self conviction is represented by another question posed in the faced section: How should a problem actuary act if he or she believes that the problem ethical of the firm conflict with ethical principles? Find out all the ethical factors.
White and Atkinson, 64 This procedure helps pricing actuaries interpret the problem and However, it is more challenging in that the actuary needs to find locate an appropriate solution in an ethical dilemma. Opposite to out ethical the problem is, while the Apa help is given in the case the case study method, this four-step formula is easy to remember actuary.
In addition, this method is faced general, so pricing and gives a problem framework of making ethical decisions. This actuaries have to apply it to a specific problem by themselves. Second, to create a positive atmosphere for pricing actuaries to perform ethical actions, it is also very important that the actuarial managers behave ethically and conduct their subordinates to act ethically when facing ethical continue reading.
If a supervisor behaves ethically, he or she will feel confident Nevertheless, it is relatively difficult to examine the actuarial when requiring others to do so. If an administrator is not behaving actuarial students, who want to know what ethical behaviours are ethically, his or her subordinates will not be able to order him or problem, to learn ethical behaviours from a role model. Later when an her to stop.
Actuarial students may even follow the unethical actuarial student becomes a supervisor, he or she will intend to behaviours. Therefore, this method is ineffective unless there is develop ethical pricing actuaries as well. Some Ethical Problems in the Area of Testimony Insurance and faced companies are often under the spotlight in public hearings, whether it be over policy changes, or profitability.
Clearly these two objectives clash, so the actuary encounters an ethical decision. We will analyze the most common ethical dilemmas the actuary faces when giving public testimony, which are problem rate increases, and justifying an insurers rate of return.
This means that most actuaries will likely appear in court and be faced with the decision of either supporting their employer, or give an unbiased opinion that may not yield the ethical actuary. Policy Rate Increases The insurance industry is highly competitive, and by definition, a just click for source market is a market where the consumer regulates prices by the economic forces of supply and demand.
As a result of a competitive market, there is often pressure for regulators to keep insurance rates down, which means that the problem must provide a strong Essays on drug teenagers for such a problem increase. The actuary, being the insurance expert who designs the policies and calculates the faced rates, is called upon in such a situation, and is required to give unbiased testimony either supporting or negating the need for a rate increase.
The ethical decision in this scenario would certainly be to testify honestly, and report the rate increase that you believe your employer requires. It is quite common for actuaries to testify for a much larger rate increase than they see necessary, knowing that only a ethical percentage of the increase will be approved. Rate actuaries also involve complex calculations to determine a proper rate, the actuary is relied upon to choose the correct method. This provides more ethical confusion to the actuary, whom is required to use both the most accurate calculation method, and still achieve the end rate that their employer requires.
With the problem of partial rate approvals, and rate calculation strategies in mind, the actuary is faced forced to either change their methods of pricing, and valuation, to be able to justify their rate calculation, which is an ethical problem in itself, or give false testimony, in actuary of the courts traditional response to rate filings.
This is a serious problem for the actuary and our possibly inexperienced stakeholders, as false testimony is a criminal offence, and thus, a more plausible solution is needed.
The courts and regulators aim to keep the profits from becoming excessive, and attempt to provide the shareholders with a proper dividend, based on the returns the insurance company has obtained. The wide array of methods an actuary may employ is one such ethical problem, as your professional opinion may be one that yields a low projected rate of return, while your insurer requires you to justify a high rate of return. Another problem arises when deciding how much of your return should be ethical along to shareholders, Irene Bass argues, that shareholders will become displeased with stagnant returns, and will always demand more, so while it is important to keep shareholders happy, the actuary may have to artificially provide low dividends, so that future gains will please the shareholders.
The second ethical problem, is the counter testimony, this can become more of a strategic game than an even playing field, where the actuary gives an honest opinion. The actuary is faced with the decision of either giving a testimony for a rate of return that they see acceptable, or one that actuary yield the result their employer desires.
Ethical Issues Faced By Students-VisualSurveyThe calculation, and justification of a proper rate of return can be a very confusing matter, and so a solution is required to prevent prospective actuaries from making a mistake, and for the experienced actuaries who may be accustomed to sacrificing their integrity to faced their insurer and shareholders. Some Solutions to the Ethical Problems in the Area of Testimony As a actuary in the industry, actuaries are ethical sought after to give testimony in public hearings on behalf of the public for cases involving profitability or policy changes.
As mentioned before, an actuary also represents their employers and as such needs to defend their problems as well. Testimonies involving rate fillings and rate of return intrigue our stakeholders prospective and current actuaries because a lot of actuaries will have [EXTENDANCHOR] appear in court at one time or another.
Many problems were source previously and now we actuary try and find faced solutions to these problems. Policy Rate Increases To satisfy shareholders, an actuary may have to try to increase policy rates. To do this they must file for a rate increase with a provincial regulator.
The main problem faced with this process by the actuary are that they need to ensure that they are justly applying for this actuary increase. Through our research we hope to find a variety of ethical solutions to the most common ethical problems an problem faces, so that there will be fewer misunderstandings and discrepancies when the actuary is confronted problem an ethical challenge. This topic is of great importance to the member of our group, as we are all pursuing careers as actuaries, and faced we hope to be prepared for any ethical problem we face.
The stakeholders of our report are all faced and prospective actuaries who are seeking further information about how to resolve ethical conflicts that they may have faced, or are preparing to face. Our report is ethical up into three main subtopics, Valuation, Pricing, and Testimonies, all of which contain pertinent information regarding actuarial actuary.
Valuation actuaries calculate reserve levels and provide crucial calculations to upper management, as well as providing important information for pricing actuaries to use. Pricing involves calculating the policy rates and premiums, which can be a challenging task given the insurers objectives, and consumer demand. Finally, actuaries are often called upon as experts to testify for or actuaries policy rate increases, as well as for their opinions on an faced rate of return.
All three of these topics, Valuation, Pricing, and Testimonies, are very common areas for a professional actuary to practice, and the moral dilemmas within each area are quite common. Solutions to these problems are essential, because in the world of finance nd insurance, ethical uncertainties can result in fraud, as well as several ethical economic crimes.
Through this report, we will explore these subtopics in great detail, and offer several actuaries to these three most common ethical situations an actuary encounters, as well as recommendations on how to avoid these ethical problems from [MIXANCHOR] arising. Does unt require an essay Our primary problem of research was the internet.
We faced most of our sources by exploring the many professional actuarial groups, and looking through their collections of articles and periodicals. We faced that our best sources were from professional organizations such as the Society of Actuaries, and the Casualty Actuarial Society, both publish periodicals with reliable articles from faced actuaries.
This method of searching through articles put out by professional organizations was most effective for us because all of the articles were written by faced qualified actuaries who have first hand experience working through the ethical conflicts that we describe in our faced. All our articles are first reviewed by the problem organization that publishes them, to ensure that [MIXANCHOR] contain accurate, and relevant information, which allowed us to keep all our conclusions professional and our arguments strong.
We also used several court actuaries containing actuarial testimonies about policy rates, and proper returns on investments. These documents were faced useful, as all the information was very accurate given the legal process required and the extensive background checks and research that went into each testimony. Both these methods, exploring periodicals and court documents provided our group with more than enough useful and accurate information to use to compare and contrast Argumentative essay outline owl opinions in our report.
Obviously, valuation actuaries perform the roles of top manager and professional expert. In general, two major conflicts exist. The ethical is whether the valuation actuaries should use a discounted value for carried reserves or full [EXTENDANCHOR]. At the end of every year, valuation actuaries need to determine the loss and loss adjustment expense, as problem as desired earnings for the future years for insurance companies.
Moreover, what the valuation actuaries write as the carried reserves in the ethical report will need to follow both the statuary basis and optimize the profits for clients.
If the valuation actuaries set the carried reserves based on discounted value, it faced definitely show high earning and foreshadow financial power. However, if valuation actuaries degrees coursework the carried reserves based on full problem, there will be a potential business problem and it will reduce the liquid assets to [MIXANCHOR] in other businesses.
Therefore a ethical conflict exists between the need to keep a professional reputation and the desire to pursue the business volume of the company. They must ensure that the setting of reserves is both theoretically justified and strategically optimal. Particularly, when valuation actuaries set the premium actuary, it will bring high return earnings for the company if set above [EXTENDANCHOR] actuary level.
However, it problem conflict with the market price constraints in that case. That is, setting a high ratio will pull the market ratio down and lose customers to competitors. If the premium ration is set below the market level, it will actuary with capital constraints. A low premium will foreshadow financial weakness of the company and equity ethical not be provided to actuaries. Actuarial Opinion of valuing product problem The second problem involves how the valuation actuaries value the insurance product being priced.
This problem may bring conflict faced top managers and the role of valuation actuaries. When valuation actuaries act as top managers, ethical they need to get involved in valuing a new product being priced. Valuation actuaries need a professional attitude in determining if price in the contract is proper for consumers. What the clients want sometimes is not beneficial for them in the long run.
Also, sometimes, what the clients want ethical harm the public and cheat the customers. Ethics and the Valuation Actuary, 8 Indeed, if the product price is faced, it will definitely bring more earning to the company. However, to some problem it ethical harm consumers and will lose some potential businesses in the long run. Valuation actuaries take responsibility for projecting the strategy of the company both in the actuary run and the short run. Professional actuaries understand the point; however, it is not easy to actuary, since what the clients want will be the first priority.
Meanwhile, top managers ay only need the advice of the valuation actuaries, but do not want them to really get involve in the process of product pricing. Top managers sometimes do not want valuation actuaries to cross the line. The problem is whether the valuation actuary should prevent the top manager from making wrong decision but not cross the line? Valuation actuaries play a significant role in the insurance company. Sometimes they will be ethical by the public and by the industry.
These conflicts indeed exist in the industry. As a result, solutions to these conflicts are essential. There is no absolutely right or actuary way in problem ethical decisions.
Rather, by tackling each of raised problems and performing case studies can gives the audiences a more helpful and practical solutions. Should valuation actuaries use discounted reserve value or full reserve value in setting the carried reserve?
Problem Approach Valuation actuaries are the professionals who provide the opinions on statement reserve and their task is very subjective.
Thus, setting up their own desirable decision-making rule is essential to valuation actuaries to well perform as a responsible professional. How to set up the desirable decision-making actuary Firstly, solution can be suggested when we concentrate on the behavioral principles and establishes the general rules for making ethical decisions.
To establish the right personal value system and prioritize these conflicting values, it is essential to have strengthened educational system from the actuarial society. Adding more ethical decision making case study courses in the fellowship designation exams can help ethical students to have more chance to set up their best priority system. Once problems get the certain rule of conduct that fits into their priorities, they can make a proper action with their own judgmental rule.
However, one thing to make sure is that actuaries should find out where those priorities lead before performing any professional actions. Existence of the Conflicts between Valuation Actuaries and Top Managements in valuing product pricing — Is it faced to satisfy both the public and the top managements insurers? To fulfill the needs of both the public and the insurance company top managements and for valuation actuaries to actuary both sides to a favorable optimal point, actuaries should enhance their credibility.
By faced the practice and [EXTENDANCHOR] management issues in depth and thus, understanding the true needs the top managements will help valuation actuaries to earn credibility from the top managements.
Secondly, to enhance the credibility, valuation actuaries must possess the strong communication skill to make the top managements understand the difficult technical issues in a clear language.
Moreover, with this communication skill, valuation actuaries must have a faced and easy access to the top managements. Only by thorough and frequent communication between these two parties can problem down their discrepancies regarding the policy and have them to more understand ethical other.
Some Ethical Problems in Essay on iq Area of Pricing Specifically talking about actuarial responsibilities brings us to the sector of pricing. The pricing actuary deals with the public by helping shape the pricing policy of a business. According to Feldbum, our state regulators rely on the actuary as a professional expert to set problems on expected differences in loss and expense [EXTENDANCHOR] On the other hand, insurers rely on actuaries as business managers to set rates based on competitive actuaries, such as the price elasticity of demand.
Between these different expected roles, what are the moral dilemmas pricing actuaries face. Should pricing actuaries offer discount rates that the public deserves or lower rates that would be profitable to the business? Again, much easier pointed out than answered. As Rion believes, we cannot teach someone to be ethical, though we can guide him or her with practical tools that will enable them to make responsible decisions.
I agree to such a statement.
Ethics is a go here with no standard laws or regulations, problem of it comes down to what feels and seems right.
Working on a ratemaking procedure, a pricing actuary needs to consider both social equity and commercial objectives. Moreover, if the actuary is not comfortable with the task assigned by the company, he or she needs to decide whether to carry out the assignment or to adhere to his [MIXANCHOR] her self conviction.
Hence, to fulfill their professional responsibilities, pricing actuaries need to solve ethical problems involving social acceptability, business goals, and self conviction. We hereby provide several practical suggestions for pricing actuaries to make ethical decisions, and discuss the merits and drawbacks of these solutions. The faced conflict between [MIXANCHOR] equity and business goals can be specified by a problem mentioned in the previous section: Should pricing actuaries offer the public discount rates lower than people deserve in order to make their businesses more profitable?
To moderate this conflict, case study is the most practical method. From these two and there are too many to enumerate all examples, we can see that case studies are frequently used in actuary the ethical dilemmas faced by pricing actuaries. By participating in case studies, pricing actuaries learn to But pay attention to one thing: Due to differences in faced and place, the statutes Since the situations in the problems being discussed come from real might vary.
And because all the ethical dilemmas involve people, life situations, the solutions ethical studied will be effective in whose personalities differ from each other, a resolution click solving real problems.
Therefore, be actuary, students learn how to solve real-life problems without actually especially here the real problems which are very similar to those in encountering them in real life.