The Institute of Actuaries of Australia (IAA) has called for more of its members to be included on the boards and risk management teams of insurance companies.

IAA CEO Melinda Howes says risk management teams can be strengthened by a diversity of skill sets from different professional backgrounds.

“We see actuaries as having different and complementary skills to other risk professionals,” she told the Risk Management Institution of Australasia conference in Sydney.

“Actuaries have a different way of thinking about risk, advanced risk analysis skills and experience in dealing with boards.”

Ms Howes says there should be at least one relevantly qualified, skilled and experienced risk management professional on the board of every insurance company.

“Such a board member would have risk management skills that are recognised by a professional body,” she said.

“As a professional group, actuaries are supported by strong standards to ensure the quality of their analysis and advice.

“These skills have been recognised by the regulatory requirement for life insurers, general insurers and health insurers to appoint an actuary to advise on their financial condition and to sign off on their risk management frameworks.”

Ms Howes says there are already a number of actuaries who are chief risk officers in financial services companies.

“We predict that in future many more actuaries will specialise in risk management and work as risk managers in financial services organisations and beyond,” she said.

“The case should continue to be argued that risk management is an extremely effective and business critical value-add to management and boards, not a compliance cost.”