Skip to content

IAI Actuarial Core Principles · Business Management · Communicating strategy; culture and structure in decision making; strategy case studies

An actuary at a general insurer is asked to present to the board a strategy paper on entering the health insurance segment. The board members are non-actuaries, and the paper contains a stochastic model with many technical assumptions. Which presentation approach best meets the Actuaries' Code expectation of communicating clearly?

The actuary should give a plain-language summary of the findings, key assumptions, uncertainty and limitations, with technical detail in an appendix. This lets non-actuarial board members make an informed decision, in line with the Actuaries' Code requirement for clear, audience-appropriate communication.

  1. APresent the full model output tables so the board can see every assumption, and leave interpretation to them
  2. BGive a plain-language summary of the key findings, the main assumptions, the uncertainty and the limitations, with technical detail available in an appendixCorrect
  3. COmit the uncertainty around the results so that the board is not confused and can reach a decision quickly
  4. DUse technical actuarial terminology throughout to show the rigour of the work and avoid ambiguity
  5. Provide only the recommended decision, since the board has appointed the actuary to make the technical judgement

Explanation

Communication must be clear and suited to the audience, covering the key results, assumptions, uncertainty and limitations. Hiding uncertainty or overloading with jargon prevents the board from making an informed decision. Giving only a decision removes the board's ability to judge.

Did you get it right without looking?

One question tells you little. A timed set on Communicating strategy; culture and structure in decision making; strategy case studies shows your real accuracy, how long you take and where you lose marks.

Practise Communicating strategy; culture and structure in decision making; strategy case studiesFree diagnostic mock

More Communicating strategy; culture and structure in decision making; strategy case studies questions