ACT 340 · Year 3 · Semester 2 · 2 credits · Professional & Ethics

Professionalism, Ethics & Actuarial Standards

Where technical mastery meets public trust: navigating actuarial standards, professional conduct, and ethical machine learning.

Full practice exam · 30 Q · 120 min

Season 1 · 8 episodes

The Standard of Care

When a regional insurer rushes an unvetted AI rating engine to mask deteriorating reserves, newly appointed actuary Maya Chen must navigate the Code of Professional Conduct, ASOPs, and regulatory rate hearings to protect policyholders and uphold her professional compact.

Protagonist · Maya Chen, ACAS, recently promoted Appointed Actuary and Lead Pricing Actuary at Beacon Mutual Insurance.

Setting · Beacon Mutual Insurance Company headquarters in Chicago, Illinois, and the Illinois Department of Insurance hearing rooms.

Stakes · Beacon Mutual faces catastrophic reserve deficiency and regulatory shutdown; signing flawed models or suppressed reserves risks policyholder insolvency, state enforcement action, and forfeiture of actuarial credentials.

Pick an episode

Episodes

Season finale: Maya presents an ASOP-compliant rate and reserve restructuring before the Department of Insurance, eliminating illegal proxy discrimination from the AI engine and compelling executive leadership to capitalize reserves truthfully.

From the lecturer: Welcome to ACT 340. Actuarial science is uniquely defined not merely by mathematical sophistication, but by the explicit public trust codified in professional standards. In this course, you will transition from pure computational execution to professional stewardship. To master this material, keep a dedicated Actuarial Standards & Case Journal beside you. When analyzing case dilemmas, do not rely on gut moral intuition; ground every recommendation explicitly in the Code of Professional Conduct (Precepts 1 through 14) and the relevant Actuarial Standards of Practice (ASOPs 23, 25, 41, 43, and 56). For technical pricing and machine learning topics, keep a dual-column notebook comparing traditional statistical risk classification criteria against statutory definitions of unfair discrimination and modern algorithmic fairness metrics. This course directly builds the professional judgment and regulatory foundations tested on CAS Online Courses 1 and 2 (OC1/OC2), the SOA Associateship Professionalism Course (APC), and the Canadian/US fellowship regulatory exams. Treat every case study as a formal brief submitted to an Actuarial Board for Counseling and Discipline (ABCD) hearing or an insurance commissioner's rate hearing. Precision in language is as rigorous as precision in calculus.

Cold open

At 7:15 AM on Monday morning, Chief Underwriting Officer Greg Vance places a glossy memorandum on Maya's desk demanding her signature on a fifty percent expansion of BeaconSmart, their proprietary personal auto algorithmic pricing model, before the four o'clock board meeting.

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Transcript

Differentiate the 14 Precepts of the unified Code of Professional Conduct and identify their direct operational implications in actuarial practice.
Apply the criteria for the US Qualification Standards (USQS), including basic education, experience, and continuing education requirements.
Evaluate an apparent ethical violation under Precept 13 to determine whether discussion or formal referral to the Actuarial Board for Counseling and Discipline (ABCD) is required.
Construct a defensible resolution to professional conflicts involving management pressure, conflicting interests, and data confidentiality.