Insiders’ Insights: Consulting Versus Insurance
Actuaries work in a variety of practice areas such as health, life, pension/retirement services, property and casualty, etc. Most of them work either at an insurance company or at a consulting firm.
Many actuarial candidates are wondering which field might be the best choice for them. We interviewed four actuaries who have worked for both consulting firms and insurance companies, to shed light on the differences between these two types of employers. They talked about their work environment, day-to-day job, as well as their advice for actuarial candidates.
Amber Lahde, FSA is a consulting actuary at Towers Watson in Weatogue, CT.
Bin Fang, FSA, PHD is an actuary at MassMutual Financial Group in Enfield, CT.
Jason Sciborski, FSA is a principal and consulting actuary at Milliman in Milwaukee, WI.
Olivia Han, ASA is a consulting actuary at Wakely Consulting Group in Englewood, CO.
Question 1: Share with us your work experience in both insurance companies and consulting firms.
Amber:
I worked in insurance for five years, starting at MassMutual once I graduated from college. I was part of the actuarial student program, where I had rotations in Corporate Tax, Annuity Product Development & Pricing, and Retirement Services Valuation.
I recently started a new position at Towers Watson working as a consulting actuary. In the past, my experience in consulting was all from internships; three months with Mercer in pensions, three months with Towers Watson in life and annuities, and two months at PricewaterhouseCoopers in property and casualty (P&C).
Bin:
My first job started with a P&C company which was primarily focused on the personal line pricing including auto and home insurance products. My next role was with a health consulting firm which was focused on the Medical Part D plan consulting and claim auditing. I had opportunities to further my actuarial exploration in the public benefit domain. In my current role at MassMutual, I am responsible for the assumptions setting and risk control in the Pension Buyout pricing area.
Jason:
I worked in health insurance primarily on dental, short term disability and life insurance lines of business. I now work in healthcare consulting.
Olivia:
I worked for a health insurance company prior to my current role as a consulting actuary. The work there was more straightforward and more repetitive and everything was on a monthly schedule whereas working for consulting company involves more spontaneous work based on projects needs and requires critical thinking more on a daily basis.
Question 2: Describe your day-to-day job in insurance & consulting, e.g., client work, work pace, technicality, face-to-face client interaction.
Amber:
From my experience, the work pace at an insurance company is generally more relaxed, with the exception of production or financial reporting based work, where there are strict deadlines. Interactions are primarily with other departments or members or your own department versus client/customer facing.
In consulting, the work pace seems much quicker; the client is the number one priority, so you need to do whatever it takes to meet their expectations and get them their deliverables on time. Client face-to-face interaction would be more common at the more experienced consultant levels.
Bin:
In my experience the consulting work required a lot of technical skills. I remembered a project required lots of VBA coding; and I was basically learning from scratch. That project lasted for three months and I became a self-taught expert on VBA at the end of the project. Consulting was a great place to practice and improve face-to-face interactions with business people. I think that it is especially important for introverts such as myself to become comfortable in front of others.
My current insurance company, at my level is team-oriented and requires a lot of communications to areas across the company. My typical day usually involves group meetings with team members and my boss to schedule and prioritize project inventories. Also, I am responsible for reviewing work done by actuarial students in my area. My current position is visible and also critical to the success of the business. For example, we recently priced a Jumbo Pension Buyout case; the case was subsequently sold to two insurers. I was heavily involved with the pricing, including mortality experience study, longevity and investment risk study.
Jason:
Pace of work is certainly faster on the consulting side. I get more variety in consulting as well. I work with commercial, Medicare, employers, multi-employer trusts and on specialty benefits like cancer and critical illness products. At this point in my career I have a significant amount of direct client interaction on a daily basis.
Olivia:
In the insurance companies, I used Excel and Access while at my current job in consulting, I use not only Excel and Access but SAS and SQL as well. The work load/pace in the consulting company is very much seasonal and flexible depending on which projects you are part of, whereas at insurance companies, working for eight hours is expected almost every day.
Question 3: Please describe some of the differences between insurance and consulting in terms of work culture, flexibility and work-life balance.
Amber:
- Work culture: I think work culture varies based on company, not necessarily consulting versus insurance. I think each insurance company has its own culture, as does each consulting firm.
- Flexibility: I think both can be flexible workplaces, again it depends on the individual company. With consulting, you may have a bit more flexibility, more autonomy, and less bureaucracy.
- Work-life balance: From my limited experience in consulting, I would say insurance has a better work-life balance. It is less likely that you will need to work overtime, and there is a clearer distinction between work and home. With consulting, I’d say it’s up to the person to make that distinction; each individual needs to determine what work-life balance is right for them, and then set goals for their career accordingly.
Bin:
- Work culture: Working in consulting is more like an entrepreneur where my work has immediate impact to the company’s bottom line; and working in insurance is a bit different where an ability to work across functional areas are greatly appreciated.
- Flexibility: All my managers have been always very supportive of my work flexibility, including working from home, taking time off with short notice, etc.
- Work-life balance: I found that insurance jobs have typically better work-life balance.
Jason:
- Work culture: Culture was pretty good at the insurance company but there were definitely some unhappy people. I think the work environment is more positive overall at my current company but overall both environments were enjoyable.
- Flexibility: More flexible work hours on the consulting side than in insurance. Hours were more level week to week on the insurance side but it was harder to take an afternoon off, or leave for an appointment and make the time up later.
- Work-life balance: More even work flow on the insurance side but less flexibility. Consultants may work long hours at times, but I think it varies depending on the areas you specialize/work in.
Olivia:
- Flexibility: It is more flexible in the consulting company. Daily hours depend very much on the current work load. At the insurance company, you are expected to be in the office for eight hours daily regardless of work load.
- Work-life balance: So far, the workload that I have been having working for consulting companies has been fairly higher than what I had in insurance companies. Thus, I would say achieving a good work-life balance is easier when working for insurance companies. I never had to travel yet, but hour-wise, I definitely worked longer hours than when working for the insurance company. For actuarial students, you get more support (time-wise) for exams in insurance companies whereas when working for a consulting companies, you are more responsible to find time to prepare for your exams on your own.
Question 4: What was the motivation behind your change of field?
Amber:
I merely interned at several consulting firms, so I wouldn’t classify my personal experience as changing fields (until my recent transition back to consulting). When I graduated college my focus was on passing the SOA exams as quickly as possible, so that I could move onto the next phase of my career. I personally felt that it would be easier to get through exams with the formal actuarial student program of an insurance company. I felt like I would have less pressure at an insurance company to work long hours, have more study time available, and thus have more time to spend studying and getting through my exams quickly. I thought that the balance of working and studying would be more difficult to achieve at a consulting firm.
Bin:
I was lucky enough to see all three major insurance industries. My view may be different than other; I feel it’s good to explore all three industries early in the career because you can then decide which one is the best fit for you. In addition, I was able to compare both insurance and consulting in my early career so I could learn the best from both practices.
Jason:
I was looking for more variety in my work and more direct control of my career path. I felt consulting would provide both so I made the switch.
Olivia:
I always wanted to explore different fields. Plus I thought working in a consulting company would enable me to be exposed to different areas of work.
Question 5: How does the rotational programs differ from one another?
Amber:
Most large insurers have rotational programs, where actuarial students (while still taking exams to achieve FSA) rotate between various departments and functions, spending about 1-2 years in each area. Students would generally continue rotating until they achieve the FSA designation, upon which they would find a more permanent role at the company.
Consulting companies, as far as I know, do not generally have formal rotational programs. The work of consultants is much more diverse and project based, so students would be exposed to many different areas/topics/functions based on the projects they are assigned to.
In my opinion this results in a key difference; students at insurers will often have very deep, thorough knowledge of a few areas, but not that much breadth. Students at consulting firms, on the other hand, will have a much wider breadth of experience, but that knowledge might not be quite as deep (since they are mainly working on shorter term projects versus spending a couple years in one specific area).
Bin:
Insurance companies tend to have formal rotational program in which the students have options to explore different areas within the company. Consulting, on the other side, can’t match the variety of opportunities.
Jason:
The insurance company I worked for did not have a rotation program. We technically don’t on the consulting side either although you are kind of in a constant rotation because you can work in multiple segments of health care at any given time.
Olivia:
Existence or structure of rotational programs depend more on the size of the company, rather than whether it’s insurance or consulting. And although the consulting company I currently work for does not have a typical rotational program, the managers try to have everyone exposed to various projects (pricing, reserving, and other ad-hoc projects).
Question 6: Is consulting only for social actuaries while insurance attracts introverts?
Amber:
I think this statement is a generalization and stereotype, and not true in either regard.
Bin:
I have seen both introverts and extroverts in consulting and in insurance. To be a good actuary whether consulting or insurance it’s more important to have the expertise in your practicing area and have good product knowledge.
Jason:
I don’t believe so. It certainly helps to be social on the consulting side, but there are social insurance actuaries as well.
Olivia:
I wouldn’t think so. However, being social and extrovert would increase your possibility of being successful in a consulting company.
Question 7: What advice would you provide to candidates or actuaries when they choose between insurance and consulting or consider transitioning from one to the other?
Amber:
I think at the pre-ASA level it’s very easy to transition back and forth between insurance and consulting, since at this point students don’t have extremely specialized knowledge. I think the more difficult thing is to make a switch between lines of business, i.e., move from pensions to life, or life to health, etc.
Bin:
It’s important to be open-minded. Whether you are in insurance or consulting or different industries, the skills which you have already acquired can be easily transferred to your next role. At the junior level positions I think it’s about equal chance to transfer between insurance and consulting. At more senior level positions the consulting work demands great sales skills, which may not be the focus for the insurance company.
Jason:
Know what truly makes you happy in your job. Are you looking to advance? Do you want more responsibility? What pace to work best at? Are you good at juggling several projects at once, or is that overwhelming? For some people insurance will be a better fit and for others it will be consulting.
Olivia:
I can’t say one is better over the other. I think it all depends on the person’s personality or priorities. However, I think I was definitely privileged to have had experience in both insurance and consulting and to know for sure that I prefer consulting without a doubt.
It appears that our interviewees have reached consensus on most of the questions regarding working environment of insurance versus consulting companies. They also agreed that both can be rewarding and provide job satisfaction. Whether consulting or insurance suits you better depends on your personality and personal career goals. Don’t be afraid of taking risks to try both, get the most out of each experience and find the best fit for you!
This article is brought to you by the SOA Candidate Connect Advisory Group:
Franklin Fotsing is an actuarial analyst at Milliman in Brookfiled, WI. He can be reached at: franklin.fotsing@milliman.com.
Matt Sauter is an actuarial analyst at Wakely Consulting Group in Englewood, CO. He can be reached at mattsauter92@gmail.com.
Catherine Chan is an actuarial analyst at Deloitte Consulting in Chicago, IL. She can be reached at sinyichan09@gmail.com.