In Good Times and Bad, We are Actuaries

By Jonathan Pollio

Small Talk, March 2021

On New Year’s Eve 2019, I watched Times Square full of people waiting for the ball to drop on 2020. Everyone talked about how 2020 was going to be so much better than 2019. On New Year’s Eve 2020, I watched a socially distant Times Square with a few select people watching the ball drop on 2021. Everyone talked about how 2021 was going to be so much better than 2020. On both evenings, I sat with my wife and daughter drinking champagne and celebrating the New Year. The evening was similar even after COVID-19 and social distancing and the election and everything else that happened in 2020.

Let’s face it, 2020 was a tough year. But, even with the strangeness of 2020, my family carried on and made adjustments to our lives (masks, social distancing, no sporting events or movie theaters, etc.) Many other events were similar pre- and post-COVID-19. We had special dinners on my birthday, my wife’s birthday, my children’s birthday and my anniversary. Obviously, we had those special occasions at home rather than out but we still celebrated them. I still called my parents most weekends happy that they are still alive to talk to me.

As actuaries, our work has been a constant throughout this uncertain time. Year end is still due end of February and products still have to be priced and reviewed. Other than some minor changes, our jobs remained the same from wherever we were working.

I realized that over the past year, Small Talk has also kind of reflected that. We had an article on illustration rules which have been constantly changing. Yet, in the end, aren’t we just trying to make sure that the people who buy our products understand what the products do?

We had an article with an interview of past leaders of the Smaller Insurance Company Section. I was surprised how many of those people I know and respect. I also was surprised how relevant their ideas are years later.

We had an article on voluntary products. Those products have changed significantly over the years. Yet, those products are really about helping companies give employees more benefit options for the money. We have a change in the accounting standards on GAAP (LDTI rules) coming up. Yet, if revenues exceed benefits and expenses when the product has run its cycle, the company makes money. If it does not, then the company loses money. Whether it is stat, tax, FASB rules or the new LDTI rules, the end results remain the same. Our articles are full of new things but it is amazing how the goals of those functions have not changed.

So, what can we learn from all of this? Even with COVID-19 and the new rules, let’s remember, we are actuaries. Wherever we work from or what our leadership is, we all have similar goals. I often have called actuaries the “conscience of the company.” We report our results whether they are good or bad. We try to price products that are worthwhile and profitable. We do our best to follow all regulations to the best of our abilities. It does not matter what the rules are or how the market changes, we try to remain the model of consistency. Our ultimate customers are the policyholder, the stockholders and the regulators, in no particular order. So, as Jean-Baptiste Alphonse Karr said “the more things change, the more they stay the same.” No matter what the world throws at us, let’s do our best to keep up the important work that we do.

Jonathan Pollio, FSA, MAAA, is senior vice president and chief actuary at Amalgamated Life Insurance Co. He can be reached at jpollio@amalgamatedlife.com.