Actuaries to test skills as fee-paid advisers

ACTUARIES, the normally retiring types who specialise in the complex mathematics of risk assessment for insurance and pension companies, have emerged blinking into the spotlight with a claim to be considered as financial advisers.

The 21 member firms of the recently formed Independent Consulting Actuaries Network (Ican) said this month that their fee-based advice on pensions and insurance could be cheaper for individual investors than using traditional advisers who are paid commissions. Ican is made up of small and medium-sized firms interested in expanding their work with private clients (most actuarial work is for corporate clients).

'There is an increasing number of private individuals, mostly executives, who are requiring individual counselling - in many cases as a result of redundancy,' said Peter Chadwick of Grove Park Consultants, one of Ican's member firms. He said he had advised clients on, among other things, pension entitlements in divorce settlements.

'Another area is trying to unravel cases where personal pensions have been incorrectly sold - for example, where people have been cajoled into transferring out of a Civil Service-type pension.

'We can quantify the loss resulting from bad advice. Actuaries are well equipped with number-crunching skills,' Mr Chadwick said.

Actuaries can offer expert advice on pension transfers, according to the chairman of Ican, Geoffrey Bernstein. 'Although the regulations have been tightened up, there are still terrific variations in the basis on which transfer values can be calculated. For example, a pension scheme with an excellent past record of paying pension increases may not take future increases into account in the transfer value. In this situation, someone shouldn't really be taking a transfer,' he said.

Like the growing number of independent financial advisers offering fee-based advice, Ican members charge their clients at an hourly rate - from about pounds 60 upwards depending on the firm. However, arranging a pension in this way saves on the initial and often substantial commission charges - especially on regular premium pension policies.

Mr Bernstein (who charges pounds 135 an hour) estimates that people considering investing pounds 2,000 to pounds 5,000 a year in their pensions may benefit financially from taking fee-based advice. He concentrates particularly on comparing the conditions and charges levied by pension firms.

'Companies' policies are put together by actuaries who are used to obfuscating the true level of charges, so it needs an actuary to pull them apart again,' he said.

Actuaries who hope to become as familiar to the public as, say, accountants or solicitors will first have to overcome their image as the grey people of the financial world. (The old joke is that an actuarial career is for people who can't stand the excitement of accountancy.)

Mr Bernstein admits his profession has an image problem. 'It's a bit like railway timetables, in that everyone agrees they are very important but no one is very interested in them.'

This perhaps overstates the present level of recognition. 'The average person hasn't even heard of an actuary,' said Mr Chadwick. 'That's not the fault of the public; that's the fault of the actuarial profession as a whole.'

(Photograph omitted)

Start your day with The Independent, sign up for daily news emails
Life and Style
Fans line up at the AVNs, straining to capture a photo of their favourite star
life Tim Walker asks how much longer it can flesh out an existence
Life and Style
Every minute of every day, Twitter is awash with anger as we seek to let these organisations know precisely what we think of them
techWhen it comes to vitriol, no one on attracts our ire more than big businesses offering bad service
News
Professor David Nutt wants to change the way gravely ill patients are treated in Britain
people Why does a former Government tsar believe that mind-altering drugs have a place on prescription?
News
Norway’s ‘The Nordland Line – Minute by Minute, Season by Season’ continues the trend of slow TV
television
Arts and Entertainment
art
Sport
Jonny Evans has pleaded not guilty to an FA charge for spitting at Papiss Cisse
football
Life and Style
Kate Moss will make a cameo appearance in David Walliams' The Boy in the Dress
fashion
News
The image released by the Salvation Army, using 'The Dress'
news
Sport
Liverpool defender Kolo Toure
football Defender could make history in the FA Cup, but African Cup of Nations win means he's already content
ebooks
ebooksA special investigation by Andy McSmith
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Customer Relations Officer

£13000 per annum: Recruitment Genius: This is an exciting opportunity to join ...

Ashdown Group: Junior Application Support Analyst - Fluent German Speaker

£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...

Jemma Gent: Project Coordinator

£12 - £15 Hourly Rate: Jemma Gent: In this role you will report to the Head of...

Recruitment Genius: Evening Administrator

£8 per hour: Recruitment Genius: This Pension Specialist was established early...

Day In a Page

Homeless Veterans campaign: Donations hit record-breaking £1m target after £300,000 gift from Lloyds Bank

Homeless Veterans campaign

Donations hit record-breaking £1m target after huge gift from Lloyds Bank
Flight MH370 a year on: Lost without a trace – but the search goes on

Lost without a trace

But, a year on, the search continues for Flight MH370
Germany's spymasters left red-faced after thieves break into brand new secret service HQ and steal taps

Germany's spy HQ springs a leak

Thieves break into new €1.5bn complex... to steal taps
International Women's Day 2015: Celebrating the whirlwind wit of Simone de Beauvoir

Whirlwind wit of Simone de Beauvoir

Simone de Beauvoir's seminal feminist polemic, 'The Second Sex', has been published in short-form for International Women's Day
Mark Zuckerberg’s hiring policy might suit him – but it wouldn’t work for me

Mark Zuckerberg’s hiring policy might suit him – but it wouldn’t work for me

Why would I want to employ someone I’d be happy to have as my boss, asks Simon Kelner
Confessions of a planespotter: With three Britons under arrest in the UAE, the perils have never been more apparent

Confessions of a planespotter

With three Britons under arrest in the UAE, the perils have never been more apparent. Sam Masters explains the appeal
Russia's gulag museum 'makes no mention' of Stalin's atrocities

Russia's gulag museum

Ministry of Culture-run site 'makes no mention' of Stalin's atrocities
The big fresh food con: Alarming truth behind the chocolate muffin that won't decay

The big fresh food con

Joanna Blythman reveals the alarming truth behind the chocolate muffin that won't decay
Virginia Ironside was my landlady: What is it like to live with an agony aunt on call 24/7?

Virginia Ironside was my landlady

Tim Willis reveals what it's like to live with an agony aunt on call 24/7
Paris Fashion Week 2015: The wit and wisdom of Manish Arora's exercise in high camp

Paris Fashion Week 2015

The wit and wisdom of Manish Arora's exercise in high camp
8 best workout DVDs

8 best workout DVDs

If your 'New Year new you' regime hasn’t lasted beyond February, why not try working out from home?
Paul Scholes column: I don't believe Jonny Evans was spitting at Papiss Cissé. It was a reflex. But what the Newcastle striker did next was horrible

Paul Scholes column

I don't believe Evans was spitting at Cissé. It was a reflex. But what the Newcastle striker did next was horrible
Miguel Layun interview: From the Azteca to Vicarage Road with a million followers

From the Azteca to Vicarage Road with a million followers

Miguel Layun is a star in Mexico where he was criticised for leaving to join Watford. But he says he sees the bigger picture
Frank Warren column: Amir Khan ready to meet winner of Floyd Mayweather v Manny Pacquiao

Khan ready to meet winner of Mayweather v Pacquiao

The Bolton fighter is unlikely to take on Kell Brook with two superstar opponents on the horizon, says Frank Warren
War with Isis: Iraq's government fights to win back Tikrit from militants - but then what?

Baghdad fights to win back Tikrit from Isis – but then what?

Patrick Cockburn reports from Kirkuk on a conflict which sectarianism has made intractable