How Insurance Companies Can Get More Value from Their Actuarial Function

Actuaries possess a unique organisation-wide view of risk. They hold a holistic understanding of an insurer’s balance sheet, making them ideally positioned to contribute far beyond traditional actuarial activities. Below are some ways to utilise the actuarial function more effectively:

• Move actuaries upstream in decision-making

Instead of reviewing decisions after the fact, involve actuarial teams early in pricing strategy, product design, reinsurance negotiations and long-term business planning.

• Integrate actuarial outputs into strategic KPIs

Economic capital metrics, pricing adequacy, risk-adjusted profitability and claims trends should inform corporate targets rather than serving solely as inputs for regulatory reporting.

• Strengthen the relationship between actuarial, underwriting and finance

When actuaries influence underwriting appetite, business plans and capital steering, the company’s decisions become more analytically grounded and forward-looking.

By repositioning the actuarial team as a strategic advisor, organisations can unlock significant value from their analytical strength.

Many actuarial and finance teams are constrained by outdated processes: manual spreadsheets, slow model runs and repetitive reporting cycles. Modernising these workflows through automation and better tooling can dramatically improve efficiency, reduce operational risk and free actuarial teams to focus on higher-value analysis.

In recent times, a growing proportion of actuaries are upskilling in coding languages such as Python, R, SQL and VBA, positioning them particularly well to drive process enhancements. Their unique combination of programming capability and deep technical understanding makes them ideal leaders for automation initiatives across firms. Automation opportunities include:

• Streamlined data preparation pipelines.
• Code-driven reserving and pricing workflows.
• Automated control checks and audit trails.
• Consistent, repeatable reporting processes.

By combining modern tooling with actuarial domain expertise, companies can reduce bottlenecks, enhance governance and generate results quicker and more reliably. Automation also frees up valuable time and allows teams to allocate more time to high-value activities such as scenario testing, assumption setting and strategic modelling.

Actuaries rely on accurate, well-structured data to produce reliable reserving estimates, assumptions, capital calculations and risk projections. As the owners of many of the organisation’s most critical quantitative outputs, actuarial teams play a pivotal role in shaping how data is collected, validated, governed and used across the business. A strong actuarial function contributes by:

• Defining data requirements for models, analyses and regulatory reporting, ensuring that data structures support both current and future business needs.
• Working with data and IT teams to establish robust controls, lineage tracking and documentation that enhance transparency and auditability.
• Driving improvements in data quality, informed by deep knowledge of the models, assumptions and processes that rely on that data.
• Embedding governance principles into processes such as assumption setting, model development, validation and reporting, ensuring consistency and accountability across functions.

With insurers increasingly relying on advanced analytics and automation, the actuarial function’s role in data and governance is becoming more influential. By elevating this responsibility, companies not only strengthen regulatory compliance but also build a more resilient, integrated and insight-driven organisation.

To maximise the value of actuarial insights, insurers must ensure strong alignment between the actuarial function and other areas of the business (e.g. underwriting, risk and finance). When these functions collaborate effectively, decisions become more consistent, increasingly data-driven and more strategically aligned. Some examples of this collaboration include:

• Align Assumptions Across Functions

Actuarial, risk and finance teams should use unified economic, inflation and demographic assumptions. Shared scenario frameworks and joint assumption-setting committees reduce inconsistencies and strengthen governance frameworks.

• Improve Actuarial–Underwriting Collaboration

Actuaries can provide underwriters with real-time pricing insights, trend indicators and profitability metrics, while underwriters offer market context and risk selection expertise.

• Work Closely with Modelling and Data Teams

Collaboration with modelling and data governance functions improves model quality, ensures data reliability and enhances transparency. This collaboration helps accelerate model development and reduce operational risk.

• Support Strategic Planning with Integrated Insights

Cross-functional input strengthens business plans, ORSA outcomes, reinsurance strategies and capital allocation. A shared view of risk ensures that executive decisions are based on clear and consistent analytics.

• Knowledge Sharing

Regular cross-team workshops, clear communication of actuarial outputs and accessible analytics build trust and help break down organisational silos, ensuring actuarial insights are shared across the business.

The actuarial skillset is continually adapting to an ever-evolving insurance landscape. Beyond traditional activities such as reserving and pricing, actuaries can bring insights into emerging risk areas, helping insurers remain competitive and resilient. High-value emerging risk areas include:

• Climate and ESG risk modelling: physical, transition and liability risks embedded in long-term projections and ORSA scenarios.
• Cyber and operational risk analytics: aggregation modelling, systemic threat assessment and risk-capital allocation.
• Inflation and economic volatility: dynamic assumption frameworks, market-consistent scenario modelling and inflation stress testing.
• Demographic uncertainty: updated longevity, morbidity and behavioural assumptions influenced by medical, social and economic changes.
• Portfolio and capital optimisation: evaluating reinsurance structures, investment strategies and capital allocation through risk-adjusted profitability metrics.

Finalyse supports insurers and reinsurers in building stronger, more efficient and more strategically aligned actuarial functions. Our Outsourced Function Services provide flexible solutions ranging from advisory support to full delegation of actuarial responsibilities.

Our Key Service Offerings Include:

• Fully Outsourced Actuarial Function

Finalyse domain experts assume full responsibility for running the actuarial function. Suitable for small or mid-sized undertakings without in-house expertise.

• Outsourced Head of Actuarial Function (HoAF)

Finalyse provides an experienced Head of Function to coordinate function activities, offering oversight and direction to the in-house team.  Suitable for small or mid-sized undertakings with some in-house expertise.

• Independent Assurance & Peer Review

Finalyse provides an independent head of function, providing assurance to Boards and management teams, adding value through peer benchmarking and pragmatic recommendations. Suitable for large or mid-sized undertakings with comprehensive in-house teams.

• Interim and Contingency Support

Our consultants quickly fill unexpected absences due to illness or resignation and can also provide interim support for planned absences such as maternity or career breaks.

• Talent Mentorship and Oversight

Our mentorship services support internal emerging talent as they prepare to transition to senior roles. We assume responsibility for actuarial function obligations, gradually easing to an advisory role as in-house talent takes on greater responsibilities.

• Start-up Solutions

We support start-ups by developing control functions and systems of governance from the ground up, allowing management to focus on scaling their business. Upon reaching critical mass, we facilitate training and transition of ownership to in-house resources.

Through these services, Finalyse enables insurers to modernise their actuarial function, reduce operational risk, and enhance strategic value – all while maintaining cost flexibility and regulatory confidence.

The actuarial function should be more than just a compliance necessity. It is a strategic asset that can materially improve profitability, resilience and decision-making. By modernising processes, strengthening governance and expanding actuarial influence across the organisation, insurers can unlock significant value. With our deep actuarial, risk and valuation expertise, Finalyse is ideally positioned to help insurers achieve this transformation.