BackAsk Mint | Actuaries are at heart of insurance business
Ask Mint | Actuaries are at heart of insurance business
PremiumRajesh Relan
The insurance business in India isn’t just growing, but also becoming more sophisticated in terms of product offerings. To help readers keep ahead of developments in this business, Mint features a Q&A on insurance every Monday.
An actuary is the heart of the insurance business. Actuaries are involved in all areas of financial management of insurance firms. These include the designing of products, pricing of products, setting policy terms and conditions, valuation of policyholder liabilities, experience investigations with regard to mortality, sickness, expenses, lapses, surrenders and so on.
Actuaries may work for insurance firms, consulting firms, the government, employee benefits departments of large corporations, hospitals, banks and investment firms or, more generally, in businesses that need to manage financial risk. Graduates in math or statistics are suited for this kind of work because actuaries are specialists in the math of insurance and investment finance. Good qualified actuaries will continue to be in great demand in the insurance industry as there are very few in India presently.
I am 27 years old and I want to insure the life of my two-year-old son. I am confused whether I should take a children’s policy in his name or mine.
The basic aim of taking a child plan is to provide for those who are financially dependent on the life-assured. Since children do not have dependants, the purpose of securing a child policy is to save for the child’s future. An earning parent is an integral part of child policies as he or she has to propose the policy and pay the premiums. If the child is the life insured, the parent who is proposing is automatically the beneficiary. Such an arrangement does not protect the child in case of the unfortunate death of the proposing parent. On the other hand, if the parent is the life insured, he or she can make the child the beneficiary and provide protection during the child’s growing years. A good plan can be a vehicle to ensure a guaranteed and risk-free financial future for your child.
Readers are welcome to write in with their queries to askmint@livemint.com. The questions will be answered by senior executives from leading insurance firms.
This week’s expert is Rajesh Relan, managing director, MetLife.
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