The introduction of the Solvency II Directive in 2012 means that there has never been a more exciting time to consider becoming an Actuarial Contractor.
This is the most comprehensive regulatory regime in the history of the insurance industry, and Actuaries will play a vital role in helping the industry to respond to these fresh challenges.
Solvency II is intended to create a supervisory framework that protects insurance policyholders and ensures general financial stability. It adopts a risk-based approach and is built on three pillars:
Sets out valuation standards for liabilities and assets and identifies a capital requirement that needs to be met.
Deals with the qualitative aspects of internal controls, risk management processes and the approach to supervisory review.
Ensures there is appropriate disclosure to increase market transparency.
Increased demand for actuarial contractors
Insurance companies reacted to the legislation changes, bringing contractors on board. We’re seeing a huge increase in Actuary Contractors on our books, and one of our industry experts estimates that each insurance company will require 15 to 20 contractors.
The thought of leaving full-time employment and setting up on your own as a contractor can appear daunting at first, but it needn’t be, especially in an industry where there is such an opportunity presenting itself. Knowing where to start can be overwhelming so pick up the phone to our representatives to have your questions answered .
Professional indemnity insurance for actuaries
Another important aspect of being an actuarial contractor is insurance. The very nature of actuarial work is intrinsic to what professional indemnity insurance covers. By providing your expertise and advice, you expose yourself to the risk of your client taking legal action against you in a situation where they suffer financial loss. As an SJD client, you’ll enjoy a 15% discount through us when you purchase a Hiscox Business Insurance product.
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Limited or umbrella?
The first decision you need to make is whether to set up your own limited company, or whether to operate under an umbrella company. There are pros and cons to each – but if you’re looking for the greatest amount of take-home pay, then any accountant will tell you that contracting through your own limited company is the most tax efficient option.
It does require a little more administration on your part, but the 15,000+ contractor clients which we already support – all of whom trade through their own limited companies – are a testament to the fact that the extra 15 or 20 minutes a month of administration that’s needed is well worth the effort.
You may also find our contractor careers section helpful, especially if you have been out of the job-hunting market for some time. There are some great hints and tips on CV writing and interview techniques, as well as ways to get an edge over your competitors.
Watch our brief LTD vs PAYE Umbrella video, then get more detail on what structure is best for you in our FREE guide.
- Umbrella & Limited – the differences between the two structures.
- Advantages & disadvantages – which route is best for you?
- Rates of take-home pay – how much could you earn?
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