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From the Readers
The Nerve
Dear Editor:
I read John Narvell's article, "India in Transition" (The Actuarial Review, May 2003) with interest. As I neared the end, I couldn't help but think, "What's the matter with those Indians, don't they KNOW that the CAS is the only actuarial society in the world that is dedicated to `the body of knowledge of actuarial science applied to property, casualty, and similar risk exposures'"? How can it be that they are "reluctant to promote our syllabus"?
Further on, I found at least part of the reason: the Actuarial Society of India is "fiercely independent...determined to control the educational process for its students," and "the ASI is open to accepting the CAS credential for admission, but only if the CAS will extend a similar membership opportunity to ASI members who have studied property and casualty insurance."
Well, the NERVE of those people! Actually wanting to have their own educational program! How could we POSSIBLY mutually recognize their credentials when they haven't studied OUR syllabus? After all, WE have a corner on the knowledge market for this product!
The attitude of the CAS seems incredibly and unnecessarily arrogant sometimes.
By the way, I was reading Steve Philbrick's column on reserves in the electronic version of The AR on the CAS Web Site, and what he said prompted me to compose a letter in response immediately, mostly in my head, while I continued reading. When I finished reading and looked for the "Letters to Editor" button within The AR Web Site, I couldn't find one.
I'm sure The AR wants letters from its members, and the most likely time that readers will be moved to write one is when they are actually reading The AR. It would be a good idea to have a "Letters to the Editor" button displayed prominently on the opening screen.
Edward C. Shoop, FCAS
Paul Lacko, The AR Editor in Chief responds:
Dear Ed:
We've wondered for a long time why we get relatively few letters to the editor. Thanks for pointing out what should have been obvious to us all along!
(In the printed brochure) an e-mail address for Letters to the Editor is now provided in the box of information on Page 2. The CAS Web Site will also have a link that sends an e-mail to the editors. It will be up and running by the time this issue posts on the Web.
A Matter of Trust
Dear Editor:I read all the material on Mutual Recognition in the May Actuarial Review, and fundamentally, I believe the question comes down to this—are we willing to acknowledge that our way is not the only way to become a casualty actuary? This month we will choose either to engage with the rest of the world or to engage in a futile attempt at protectionism.
I will trust the CAS Board of Directors to ensure that anyone admitted as an FCAS under a Mutual Recognition agreement is an appropriately qualified casualty actuary. Without reservation, I will vote yes.
Clive L. Keatinge, FCASSerious Flaws in MR Argument
Dear Editor:I read with interest the discussion on Mutual Recognition in the May issue of The Actuarial Review. The importance of this topic has encouraged me to review other correspondence generated by both sides of the debate on this subject over the past four years in order to be better prepared for the upcoming vote to amend the CAS constitution.
While much of the alleged rationale for Mutual Recognition is based on unsubstantiated premises such as Mutual Recognition will result in "more job opportunities" and Mutual Recognition will "make FCAS more attractive as a designation of choice" I find the case in favor of Mutual Recognition, if implemented properly, to be compelling. The completion of equitable Mutual Recognition agreements with other actuarial organizations would be of positive benefit to the memberships concerned as well as the employers and publics that they serve. With the increased globalization of business, trade, and society in general, we are ill-served by perpetuating a collection of loosely related professional organizations across countries and regions. I believe that a series of properly designed Mutual Recognition agreements will go far to reducing this disparity and hopefully lead us closer to what will ultimately someday become a truly global profession with uniform qualification and practice standards.
Having said this, I find that the current proposal for Mutual Recognition to simply swap designations between the CAS and certain organizations such as the Institute of Actuaries, albeit subject to certain conditions, to be seriously flawed for a number of reasons. Following the style of a well-known talk show host, the top ten reasons why I believe that Mutual Recognition in its current form is wrong for the CAS are:
10.The majority of the respondents to the 2002 survey on the Value of CAS Membership in the International Marketplace were opposed to Mutual Recognition, and few indicated any harm from the lack of Mutual Recognition.
9. Mutual Recognition pursued via the CAS confuses practice rights with educational qualifications.
8. The Education Policy Committee sees, at most, four exams of rough equivalency between the CAS and the most closely comparable society (i.e., the Institute of Actuaries).
7. Mutual Recognition would result in the specialist education qualifications of the CAS being recognized elsewhere as equivalent to the non-property/casualty-specific qualifications of other organizations.
6. Mutual Recognition degrades the CAS's well-founded tradition of insisting upon successful completion of uniform examinations as a prerequisite for admission to Fellowship.
5. Mutual Recognition is particularly unfair to our Associates and students. Based upon the Education Policy Committee's comparison of the two exam systems, Asssociateship in the CAS involves the successful completion of three more property/casualty-specific examinations than does the Institute of Actuaries. This is in addition to an average travel time to Associateship that is three years longer than the average travel time for Fellowship in the Institute.
4. When presented with a shorter travel time, exemption for university courses, local recognition and acceptance, the ability to practice in both the life and non-life areas, and the opportunity to acquire FCAS status through Mutual Recognition, virtually all foreign students can be expected to choose their local qualification process over the rigorous and extended course of CAS examinations.
3. Given the considerably shorter travel time, a significant number of North American students can be expected to pursue qualification in a foreign actuarial society as a faster means by which to obtain their FCAS via Mutual Recognition.
2. Mutual Recognition between societies with different syllabi and examinations will create separate and unequal paths to Fellowship.
1. As the most senior association representing and governing the practice of all actuaries in the United States, the American Academy of Actuaries should implement Mutual Recognition—not the CAS.
While the above clearly points to recognition via the American Academy as being the route to follow, I have heard arguments to the effect that it is not possible or practical to enter into Mutual Recognition agreements through the American Academy. Given that the Canadian Institute of Actuaries has successfully entered into Mutual Recognition agreements governing both life and casualty insurance practice in Canada with the Institute of Actuaries and other societies, there should be no reason why the American Academy should not be able to do the same as respects practice rights in the U.S., irrespective of the single membership category of this body.
In summary, Mutual Recognition is an important goal that should be pursued on a cautious and selective basis. With proper safeguards, such as commonality of examinations and qualification requirements, it should be possible, in time, for the major actuarial societies to achieve a truly international membership. Unfortunately, the current proposal by the CAS Board does not yet meet these requirements.
As I trust, you will appreciate the views expressed above are mine and not necessarily those of my employer.
David R. Whiting, FCASAnother Window on MR
Dear Editor:I would recommend voting members visit the CASNET discussion forum on the CAS Web Site and enter a search for the topic Mutual Recognition. While the site is not navigationally friendly, it provides an open discussion forum and includes pro and opposing views to MR, including those of our Associate members. It is interesting reading.
Ralph L. Rathjen, FCAS
