1. What are the differences between the IFAA program, the Quantitative Finance program (QFIN), and the Risk Management Science program (RMSC) at CUHK?
There are two major differences. Firstly, both IFAA and QFIN are under the CUHK Business School, whereas RMSC operates under the Faculty of Science. The extra-curricular activities organized by the business school, such as mentorship, internship, and exchange programs, are available to IFAA and the QFIN students. Secondly, the three programs have difference focuses. The IFAA program aims to provide in-depth knowledge to persons who wish to pursue careers in the insurance and actuarial professions, whereas the QFIN program aims to provide in-depth knowledge to those who seek careers in investment and finance. The RMSC program focuses more on the general mathematical theory and statistical analysis of various risks, whereas the IFAA program concentrates on the practical and financial analysis of risk as faced by insurance companies.
2. What are the advantages of the IFAA program over other similar programs offered in Hong Kong?
The IFAA program provides comprehensive training in the four interrelated components of the insurance industry (business, insurance, actuarial science, and finance), while allowing students to tailor their studies to suit their career goals using a flexible course structure and internship opportunities. Moreover, the CUHK Business School provides its students with various activities to prepare them for the ever-changing business world.
3. Does the IFAA program provide courses and training to cope with the broad needs of the insurance industry or the financial services industry?
The program has been designed with four key learning areas in mind.
i. Basic business knowledge – accounting, economics, marketing, and management;
ii. Knowledge of the purposes, designs, and applications of insurance products – life and health insurance, property and liability insurance, pensions, and reinsurance;
iii. Knowledge of mathematics, statistics, and actuarial science – calculus, linear algebra, probability, stochastic processes, interest theory, life contingencies, loss models, credibility theory and survival analysis;
iv. Knowledge of finance and investment tools – corporate finance, investments, fixed income analysis, derivative securities, asset and liability management.
4. The IFAA program is under the business school. But shouldn’t actuarial training be offered by the Faculty of Science?
The actuarial profession has moved somewhat in the past decade or so from a very quantitative discipline to a hybrid of quantitative analytic and business profession. This is reflected in changes (in 2005) in the examination system offered by the Society of Actuaries and Casualty Actuarial Society. The IFAA program not only provides students with in depth quantitative actuarial training, but also gives them the business exposure that is essential for actuaries to advance to senior management positions.
5. What does an actuary do?
There are several kinds of actuaries, ones specializing in life insurance, casualty insurance, pension. There are actuaries working in non-traditional area as well. Typical actuarial projects share quite a lot of similarities. They include the following:
i. The development and implementation of financial and risk management strategies formulated to ensure an insurance company be able to meet their liabilities;
ii. The design and pricing of financial/risk products;
iii. The signing and certification of the Actuary’s Report on the financial status of an insurance company (which means that the appointed actuary must act independently and prudently in the sole interest of policyholders);
iv. Calculation of premium, rates, reserves, profit and bonus for insurance products, and company pension liabilities;
v. Participation in corporate financial planning and restructuring activities, such as mergers and acquisitions.