Edition

Society of Actuaries Research Institute’s Research Executive Committee

2024 Emerging Issues Research

Background and Purpose

The strategic plan of the Society of Actuaries (SOA) Research Institute includes several important research goals. One goal is to support emerging issues and topics in established practice areas and encourage the development of research projects that have a strong impact on the actuarial profession. The primary purpose is to select and fund high-quality research projects that directly educate members on applicable topics. Additionally, the SOA Research Institute desires to develop additional intellectual capital that serves the interest of the public and the profession’s stakeholders.

The Research Executive Committee (REC) of the SOA Research Institute oversees the funding of the Emerging Issues Pool. This key source of research funding is used to sponsor projects that are beneficial to the entire profession, across practice area boundaries that may require funding levels beyond the normal annual funding budgets of research committees and sections. The REC is issuing this Request for Proposals (RFP) to fulfill the strategic goals of the organization through the use of this pool for funding new projects.

Research Objective

To broaden knowledge in emerging issues and topics, the REC is seeking researchers to submit one or more proposals. Sample topics below have been identified as focus areas by the REC. The description of each of the topics has deliberately been written to be brief and open-ended to give researchers sufficient latitude in the development of their proposals. Researchers should not feel constrained by these topics, as many other relevant topics continuously emerge.

Key considerations in the proposal review process by the REC are the demonstration that the expected work will not be duplicative of existing material, will represent a significant expansion in the current knowledge on the topic, and will be of considerably strong impact and benefit to the SOA Research Institute, SOA members and other stakeholders. In keeping with the strategic goals of this RFP, proposals should approach a topic with actuarial competencies in mind. This includes competencies such as management and measurement of risk among others. Furthermore, proposals should include an overarching focus on the core principles of the SOA Research Institute including objectivity, quality, relevance, factual assessment and quantification.

Projects can range in size, breadth, and duration. Output should include a project report and materials that can be used for member and stakeholder education; other project outputs that can enhance understanding of results (such as spreadsheets, pivot tables, infographics, and models) are encouraged. Given the desire to advance knowledge on current subjects and provide timely results, preference will be given to projects that can be completed with relatively short turnaround time.

The SOA and REC additionally encourage partnerships between academia and industry where the resulting work can be of mutual interest and enhance the breadth of the research work.

Suggested Topic Areas:

  1. Actuarially related aspects of artificial intelligence (AI). Examples:
    1. Applications of AI on actuarial techniques for pricing and valuation.
    2. How AI can be used to detect fraud associated with insurance claims as well as how it can fabricate fraudulent claims.
    3. AI applications to further develop emerging insurance markets and new products globally.
    4. The use of AI to enhance planning for a secure retirement and preventing fraud for the elderly.
    5. Governance practices of using AI properly and the risks of misuse in actuarial and insurance settings.
    6. Opportunities and risks of AI on actuarial employment across practice areas.
  2. The current and forecasted direct and indirect impact of paradigm shifting situations like COVID on aspects of an insurer’s operations and financial results including company earnings. What are potential frameworks for crisis management in situations such as these and dealing with blips in experience?
  3. The general long-term impacts of COVID and/or specifically Long COVID on insured, employee or population groups, including:
    1. Impact of morbidity on disability income insurance, long-term care insurance, critical illness insurance or health care insurance.
    2. Impact on mortality arising from further aggravating or creating new chronic conditions, or from increasing mental health conditions.
  4. A review of lessons learned and comparison of previous periods of high interest rates, increasing inflation, US dollar fluctuations, and significant changes in yield curves from a global insurance and annuity markets perspective. This would include both risks and opportunities such as introduction and development of new products to meet stakeholders needs, the risk of disintermediation, risk of concentration in newer asset structures, mortgage investments, operational risks, etc.
  5. The continuously evolving strategies for talent acquisition, development and retention strategies within the actuarial profession as well as diversification of workforce including approaches such as – the expanded use of remote and hybrid work opportunities, use of onshore vs. offshore talent, development of high-potential and next-generation leaders, use of artificial intelligence to maximize resources, and strategically shifting actuarial resources to new areas within company or consulting firm operations.
  6. The latest developments in the prediction and measurement of the impact of climate-related disasters/extreme events including such techniques as attribution analysis, and related actuarial considerations. As an example, this could include a cause-and-effect analysis from the perspective of climate risk and how the occurrence or non-occurrence of certain events may impact this risk as well as mortality and general health.
  7. Innovative approaches for measuring and calculating an entity’s carbon footprint with an emphasis on transparency. Considerations may include ease of documentation, availability of data, and identification of major areas for potential reduction, as well as its applicability for SEC disclosure as it relates to life insurance companies.
  8. The extent of risk posed by wildfires for Property and Casualty companies, and risk management techniques that may address this risk. Risks can include secondary perils such as severe convective storms, winter freeze and landslides.
  9. An analysis of the increase in healthcare costs from expanded coverage of benefits previously considered not medically necessary. Examples include infertility treatment and bariatric surgery.
  10. An analysis of the current impact of HIV/AIDS on different insurance lines such as developments in coverability, mortality experience, and new treatment protocols. The analysis may include the overall impact on retirement security and related decisions for older HIV patients and others with the condition. International considerations with respect to the analysis are also of interest.
  11. The impact of decreasing fertility rates from an actuarial perspective with consideration of various areas of practice and how it can vary internationally.
  12. An assessment of private equity investors increasingly becoming significant players in the insurance industry and the implications of this trend on insurance risk and how it is managed.
  13. Design of cyber insurance products tailored to the growing cyber threats faced by businesses globally.
  14. Effective strategies for leveraging mobile technology and digital platforms for insurance distribution in under-penetrated markets.
  15. Strategies for expanding health insurance coverage to low-income populations, considering affordability and access challenges.
  16. An analysis of the actuarial impact of an aspect of complex assets.
  17. The economic impact of measles through additional cost to the healthcare system, mortality increase and other factors.

Proposal and Emerging Issues Pool Application

Proposals may be made for any desired research. All proposals must be accompanied by a formal Emerging Issues Pool Application (see A, below). To facilitate the evaluation of proposals and applications, the following information should be submitted:

  1. Along with the proposal, a formal application for funding to the Emerging Issues Pool must be prepared and submitted by the proposer. The application and guidelines for submission can be found by clicking on the following hyperlink: https://www.soa.org/research/opportunities/emerging-issues-research-pool/. Included at the end of the application are five key criteria that the REC evaluates carefully.

    The five criteria and their relative weighting in the evaluation are:
    Impact: What is the impact of the proposed research to the actuarial profession? Why will the research be deemed as significant in investigating current events and emerging topics for actuarial practice areas? Weight = 50%
    Cost-Benefit: How is the total budget for the proposed project in line with desired outcomes? How does the research add value to the profession? Weight = 20%
    Uniqueness: How unique is the proposed application to meet its objectives? Weight = 10
    Viability: How viable is the proposed project considering available researchers and data? Weight = 10%
    Quality: What actions have you taken or plan to implement to ensure that the expected outcome(s) will be of high quality? Weight = 10%
    Please be sure to answer the criteria questions in that section of the application with sufficient detail and explanation. The answers form the primary basis for evaluating the application and proposal.
  2. Resumes of the researcher(s), including any additional research colleagues or graduate student(s) expected to participate, indicating how their background, education and experience bear on their qualifications to undertake the research. If more than one researcher is involved, a single individual should be designated as the lead researcher and primary contact. The person submitting the proposal must be authorized to speak on behalf of all the researchers as well as for the firm or institution on whose behalf the proposal is submitted.

  3. An outline of the approach to be used (e.g., literature search, model, survey, data analysis, etc.), emphasizing issues that require special consideration. Details should be given regarding the techniques to be used, collateral material to be consulted, and possible limitations of the analysis.

    Please note the reviewers of this application have varying actuarial backgrounds and subject matter expertise. It is helpful to include a brief explanation/context related to the topic and proposed research with the varying backgrounds of the reviewers in mind. This should include an introductory paragraph(s) describing the topic for a reviewer unfamiliar with the area of practice under consideration.

  4. A description of the expected deliverables and any supporting data, tools or other resources needed to accomplish the project.

  5. Cost estimates for the research, considering items such as compensation for investigation, report preparation, and material costs. Such estimates can be in the form of hourly rates, but in such cases, time estimates should also be included in order to determine the likely total cost of the project. Any guarantees as to total cost should be given and will be considered in the evaluation of the proposal. While cost will be a factor in the evaluation of the proposal, it will not necessarily be the decisive factor.
    As a guide for developing the project budget, please review the Historical Project Cost Guide (see Appendix)
  6. A schedule for completion of the research, identifying key dates or time frames for research completion and report submissions. The REC is interested in completing these projects in a timely manner for maximum current impact. Suggestions in the proposal for ensuring timely deliver, such as fee adjustments, are encouraged.

  7. Other related factors that give evidence of a proposer's capabilities to perform in a superior fashion should be detailed.

Selection Process

The REC will oversee the selection of projects. Researchers are encouraged to review the evaluation criteria for Emerging Issues Pool projects in order to ensure project proposals are consistent with the goals of the Emerging Issues Pool. The REC will review each proposal and is responsible for recommending proposals to be funded. Input from other knowledgeable individuals also may be sought, but the REC will make all final decisions, subject to SOA leadership approval. SOA Research Institute staff will provide staff actuarial support to develop and publish the projects.

Questions

Any questions regarding this RFP should be sent to REC@soa.org.

Submisson of Proposal

Final proposals for the project should be sent via e-mail to REC@soa.org.

Proposals must be received no later than July 30, 2024. It is anticipated that proposers will be informed of the status of their proposal within 30 days of the submission deadline.

Note: Proposals will be considered confidential, and in order to preserve the research intentions of the proposer will not be shared beyond the review teams.

Conditions

The selection of a proposal is conditioned upon and not considered final until a Letter of Agreement is executed by both the SOA Research Institute and the researcher.

The SOA Research Institute reserves the right to not award contracts for this request for proposals. Reasons for not awarding a contract could include, but are not limited to, a lack of acceptable proposals or a finding that insufficient funds are available. The SOA Research Institute also reserves the right to redirect the project to other committees or sections within the organization as is deemed advisable.

The SOA Research Institute plans to hold the copyright to the research and to publish the results with appropriate credit given to the researcher(s).

The SOA Research Institute may choose to seek public exposure or media attention for the research. By submitting a proposal, you agree to cooperate in publicizing or promoting the research and responding to media requests.

The SOA Research SOA Research Institute may also choose to market and promote the research to SOA members, candidates and other interested parties. You agree to perform promotional communication as reasonably requested, which may include, but is not limited to, leading a webcast on the research, presenting the research at continuing education meetings, and/or writing an article on the research for an organizational publication.

Appendix

The cost ranges below are intended as a guide for budgeting project costs for proposals in response to SOA Research Institute Request for Proposals (RFP). Please note these figures span the 33rd to 66th percentiles for all projects as well as projects that involve a specific approach (lit review, survey, etc.). They are based on historical costs over several recent years. Expected costs for some RFPs may fall outside these ranges depending on the nature of the work and resources required for completion.

All Contracted Projects

This category includes all contracted projects that the SOA Research Institute has undertaken within the last several years.

The 33rd-66th percentile project costs range is $25,000 - $50,000.

Literature Reviews

This category includes projects that involved only a literature review or the cost for the portion of a larger project that included a literature review.

The 33rd-66th percentile project costs range is $15,000 - $20,000.

Surveys

This category includes all projects that had a survey as their primary component.

The 33rd-66th percentile project costs range is $28,000 - $55,000.