The Kenyan Boon

Daniel Mutuku, 15/07/2009

Yes, and this is in reference to the field of Actuarial Science. It was a timely answer to the uncertainties that revolve around us as Kenyans. One major concern, especially for parents, is Will my children study through to college (and have a financially stable future)? Also, if a major illness occurs, the particular household would be cash strained. Well, the traditional areas of function such as life insurance, pensions and healthcare are being addressed currently by local actuarial expertise.

The customary areas do have a high demand for actuarially-trained individuals. This is in tandem with the growth of the financial services sector. More people are taking on insurance, and even more are coming into pension schemes. An individual born in 1954 will be turning 55 this year. This means that numbers born in the immediate pre- and postindependence period are now pensioners, considering most were in pensionable occupations. The growing middle class has made its interest in this sector felt. These instances show a growth of relevance in this field.

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News coming from America suggests strongly that the housing crisis could have been well avoided if actuarial minds had come on board in a major way. The ripples (more like waves!) spread round the globe, the story is well known. The Kenyan society has a lot to learn from this. First, actuarial knowledge is relevant and is here to stay! Secondly, the entire financial sector needs some actuarial mind in at least every sub-sector. Not just the usual insurance and pensions. This means any sub-sector in which financial risk is present. I hence read this: Actuarial expertise is required in the entire financial sector.

So what are the other areas in which we can venture into?

Thinking in terms of the local economy yields myriad answers. One is micro insurance, considering that a major part of the Kenyan consumer profile can only afford to pay small chunks of money. The major research organisations can also use our expertise in looking at the financial domain. This does raise the issue of economic problems that Kenya has. Actuaries have the capacity to give expert opinions that will stand the test of time. Every Kenyan needs to live a decent life, with the basic necessities

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affordable. Actuaries and budding actuaries must get into this kind of research to directly serve a public purpose.

An article in a UK newspaper reported an MP raising concerns on actuaries failing to inform the public on time with regard to potential financial breakdowns in companies. As we penetrate to wider areas, we will need to be careful in sensitizing the public about the scope of our profession, emphatically. We will also need to have the actuarial society give a green light on the manner in which we venture. The principle of collective responsibility sets in since this is who we are. A blot in the name of this profession is highly undesirable.

In addition, it is imperative that we have confidence in the results that we arrive at. This means that there will be no hesitation on our part to release that information to the public.

Lets forge ahead, carefully, prudently, systematically, with vision, purpose and a strong will to achieve. Our promised land beckons!

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