By IANS,
Chennai: The Insurance Regulatory and Development Authority (IRDA) may not face problems in filling up vacancies when two of its top actuaries retire next month if the government casts its net wide, an expert said.
A highly technical vocation, actuaries are experts in assessing the financial impact of future events, which is of prime importance in the insurance business. They analyse the past and forecast the future and place the results in financial terms to help in decision-making.
The insurance watchdog is finding it difficult to get replacements for its top actuaries with two senior experts — current member-actuary R. Kannan and executive director for actuary K. Subrahmanyam — set to retire in June.
“The law does not specify any particular educational qualification for the position of actuaries,” R. Ramakrishnan, a member of the Malhotra Committee on Insurance Reforms, said in an interview to IANS.
“As per the act, the central government can appoint whole-time members to the regulatory authority from amongst people with ability, integrity and having the experience in life or general insurance, actuarial science, finance, law, economics and others.”
Formed in the mid-1990s, the Malhotra Committee charted the way for opening up India’s insurance business to private players.
Early this year, the government had invited applications for the position of a member-actuary for the regulatory authority from among Indian citizens who are fellow members of the Institute of Actuaries of India (IAI) or the British institute.
The advertisement called for a minimum of 15 years’ experience in actuarial functions in a life insurance company or at least three years’ experience as appointed actuary in a life insurance company.
It is reliably learnt that no actuary sent in his or her application, necessitating the setting up of a three-member search committee to shortlist names of suitable candidates for the government to choose from.
According to Ramakrishnan, the government can expand the selection basket by looking at associate members of the institute, or those who have passed the associate level, with sufficient experience in an insurance company or in finance and investment fields.
“At the fellow level, the subjects taught are more finance-related. An associate member with sufficient work experience can easily serve with the regulatory authority,” said said Ramakrishnan, also a former president of the association.
“For such a candidate, the salary levels at the regulatory authority will also be quite attractive.”
But disagreeing with Ramakrishnan, association president Liyaquat Khan told IANS: “The position of member-actuary is more of a technical role and only a fellow member would be suitable.”
An actuary in a life insurance firm told IANS that the main reason for actuaries not applying for the post could be salary. “The salary for member-actuary with the watchdog is Rs.250,000 per month. But insurance firms pay double that to junior actuaries.”
This apart, potential candidates in the age group of 45-50 also may not want to take up a regulatory position at this stage their career as it may affect their career prospects once the contract ends.
“After retirement as regulator, an actuary cannot accept a job in any insurance company for two years. If the government relaxes this regulation, actuaries may consider the openings,” said a senior actuary in a life insurance company.
Another suggestion was to look for professionals from other global institutes. According to Ramakrishnan, however, there was no need for the government to consider non-resident Indians as there was sufficient talent within India.
He said time had come for the insurance watchdog to have two member-actuaries — one for life insurance business and the other for non-life insurance sector, as the number of players in both the sectors was high.