SOA Climate Risk Certificate Program, General Insurance Course
By Anthony Cappelletti
Earlier this year, the SOA began offering its latest certificate program: Climate Risk. The program was developed by the SOA and the actuarial consulting firm Milliman. It provides a great deal of content on topics relating to climate risk including climate risk management and the analysis of the effects of climate risk.
The program includes six courses as follows:
- Course 1 – Climate Risk Fundamentals
- Course 2 – Climate Risk Data Sources
- Course 3 – Climate Risk Modeling
- Course 4 – General Actuarial Risk Analysis/Climate Risk Impact
- Course 5 – Specialized Education in Climate Risk (selecting one option from five available)
- Course 6 – Climate Risk Governance and Strategy
To earn the certificate, one must successfully complete all six courses and pass an assessment. However, there is also the option to take any of the courses on a standalone basis—for those that do not have the time to commit to the whole program or just want to focus on climate-risk topics covered in a specific course (or courses).
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The full certificate pairs the risk management acumen of actuaries with the interdisciplinary expertise necessary to manage the complexity of climate risk. |
When a participant in the program registers for Course 5, they must choose one of the following practice-area options:
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Course 5a (CR-103) |
Life Insurance |
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Course 5b (CR-104) |
Health Insurance |
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Course 5c (CR-105) |
Pensions |
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Course 5d (CR-106) |
General Insurance (GI) |
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Course 5e (CR-107) |
Investment/Finance |
Within Course 5, participants apply the information presented in Courses 1 through 4 to their chosen practice area. The practice areas align with the practice areas offered in the SOA’s FSA requirements.[1]
COURSE 5d – General Insurance
For the Course 5 GI option, participants are presented with a case study about a fictitious general insurance company, Proactive Insurance Company (PIC).
| PIC is a mid-sized U.S.-based insurance company relying on global reinsurers. A recent catastrophic loss event has created a hard reinsurance market for PIC. PIC’s CEO has tasked PIC’s chief actuary with understanding and assessing the financial impact of climate change on the company’s future. |
The case study follows how PIC’s chief actuary would prepare a plan to assess the climate change risks faced by company.
This course is divided into the following parts:
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Introduction |
Introduction to PIC and the challenges it faces. |
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Part 1 |
Categorization of climate risks by insurers/PIC. |
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Part 2 |
Effect of climate change risks on the various coverages offered by PIC. |
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Part 3 |
Approaches to assess the effect of these risks on PIC’s strategies and operating functions. |
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Part 4 |
Background on Scenario Analysis and Stress testing. |
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Part 5 |
Approaches to estimate the financial effects of climate change risk on PIC. |
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Part 6 |
Actuarial involvement in how insurer’s deal with climate change risk. |
Actuaries have very diverse skill sets that makes it possible for them to be leaders in the climate change space, including risk quantification/modeling, planning, and ERM knowledge. Completion of this course augments a GI actuary’s knowledge so that they may contribute significantly to assessing how climate change risk will affect both the general insurance industry and individual general insurers. It also enhances their ability to communicate this information intelligibly to others.
Refer to the Climate Risk Certificate Program page on the SOA website for details on the program and information on program registration.
Statements of fact and opinions expressed herein are those of the individual authors and are not necessarily those of the Society of Actuaries, the editors, or the respective authors’ employers.
Anthony Cappelletti, FSA, FCIA, FCAS, is a staff fellow for the SOA. He can be contacted at acappelletti@soa.org.