Society of Actuaries Membership: FSA or CERA?

Society of Actuaries Membership: FSA or CERA?

First, what is an Actuary?

An actuary is a professional who identifies and analyses the financial impact of various uncertainties. Actuaries apply mathematical, analytical and computer programming skills to come up with models that identify and manage potential risks. That said, actuaries are the people behind the success or failure of different companies, especially insurance companies. The ability of an actuary to predict expected future loss and hedge against that particular loss ensures that a company remains solvent, that is to mean that at any particular moment, the assets held by the company exceeds its liabilities. The opposite poses threats to the financial well-being of a company.

To become a fully qualified actuary, one not only needs a bachelor’s degree, but also a certification from an actuarial body. Contrary to people’s believes that only actuarial science students can turn out to be actuaries, students pursuing a variety of stem courses can, in fact, become fully-fledged actuaries. A fully-fledged actuary needs to sit and pass a set of actuarial exams, which are offered by different actuarial bodies.

To qualify as an actuary in the United States of America and in Canada, individuals need to pass the actuarial exams offered and regulated by various actuarial bodies. The Society of Actuaries is the most common and the most preferred actuarial body for actuaries who would like to work in the United States of America and Canada. However, for individuals who would love to work not just in the US and Canada but also in commonwealth countries, the Institute and Faculty of Actuaries would be the preferred actuarial body. The Society of Actuaries was formed in 1949 as a result of the merging of two actuarial bodies, the Actuarial Society of America and the American Institute of Actuaries. The Society is committed to advance the actuarial knowledge of its members. It requires individuals to sit and pass seven to ten actuarial exams before they can be accredited as actuaries.


To become a member of the Society of Actuaries, a person has to first decide their area of interest.  Generally, an individual can either turn out to be a life and health insurance actuary or a property and casualty insurance/general insurance/non-life insurance actuary. Life and Health insurance encompasses life insurance, health insurance, gratuity and benefits calculations and pensions. Property and Casualty Insurance is made up of:  property insurance, general insurance, and liability insurance. It has been observed that the property and casualty insurance is growing at a faster rate as compared to the life and health insurance. A life and health insurance actuary will take the exams offered by the Society of Actuaries. A property and casualty actuary, on the other hand, will opt to either take the exams offered by the Casualty Actuarial Society or those offered by the Society of Actuaries.

The benefits of becoming a property and casualty insurance through the Society of actuaries include: Access to e-learning modules that have been incorporated into the syllabus so as to give candidates more experience, Basic knowledge in all the areas of actuarial practice before specialization, Exposure to a lot of exams before specializing to allow candidates an ample time of choosing their preferred career path and an unrivalled access to support resources and a global network of professionals.

However, according to statistics released from a 2018 survey, the option to become a property and casualty actuary through the Society of Actuaries was the lesser preferred option since the option had just been recently introduced. Individuals opting for accreditation through the Society of Actuaries will have to make a choice between becoming a Fellow of the Society of Actuaries (FSA) or a Certified Enterprise Risk Actuary (CERA).

Fellow of the Society of Actuaries (FSA)

A fellow of the Society of Actuaries has the right to vote during an election. To gain the FSA title, a person needs to have completed a set of 10 exams. A summary of the exams is as shown below:

  1. Probability Exam (Exam P) – Tests a candidate’s probability knowledge. Good understanding of calculus is vital in passing this exam.
  2. Financial Mathematics Exam (Exam FM) – The exam requires a student to have knowledge of calculus and probability. It introduces students to financial derivatives and covers interest rate theory.
  3. Investments and Financial Markets (Exam IFM) – Serves to develop an individual’s knowledge in corporate finance and financial modeling, and how to use financial models to solve various risks.
  4. Statistics for Risk Modeling (Exam SRM) – This exam introduces a candidate to the various models used to analyze data.
  5. Short Term Actuarial Mathematics Exam (STAM) – It is an application-based exam that is built upon concepts from the probability exam. Therefore, it requires a deep understanding of probability.
  6. Long Term Actuarial Mathematics Exam (LTAM) – Tests the candidate’s knowledge of payment models and the application of those models to financial risks.
  7. Predictive Analysis (Exam PA) – This is an analytical exam that requires the candidate to analyze a given set of data that corresponds to the data sets in a business environment.
  8. Fellowship exams (3) – The fellowship exams define the eventual career path of an individual. The Society of Actuaries provides six different tracks from which an individual gets to choose from. The six areas of specialization provided by the Society are: Group and Health Insurance, Investments, Life Insurance, Property and Casualty Insurance, Enterprise Risk Management and Retirement Benefits.

Certified Enterprise Risk Actuary (CERA)

To become a CERA, one needs to attempt and pass a set of seven exams. One can qualify as a CERA before qualifying as a fellow. Exams needed to qualify as a CERA are:

  1. Probability Exam (Exam P)
  2. Financial Mathematics Exam (Exam FM)
  3. Investments and Financial Markets (Exam IFM)
  4. Statistics for Risk Modeling (Exam SRM)
  5. Short Term Actuarial Mathematics Exam (STAM)
  6. Predictive Analysis (Exam PA)
  7. Fellowship exam – Enterprise Risk Management (ERM)

Benefits of the Membership

  1. Employment opportunities. As a member of the Society of Actuaries, you get to be considered first for job openings within the society.
  2. The accreditation from the Society of Actuaries is recognized worldwide and therefore, an accredited actuary can work in any part of the world.
  3. Access to informative and educational resources, podcasts, webinars, and webcasts

It is therefore advisable for an actuary aspiring to work in the US or in Canada to join the Society of Actuaries as either an FSA or a CERA. More help on summarized study materials for candidates who would like to attempt the SOA exams can be obtained from our website.

Actuarial Exams – Complete Courses for Exams P & FM