Actuarial science is used to determine the risks involved in the insurance and financial sector. Actuaries are professionals who are employed to do this job using their skills in fields such as finance, mathematics, probability, statistics, and economics. Actuarial science is a very broad term encompassing subjects that may range from psychology to advanced mathematics such as calculus.

• The insurance sector has benefited immensely due to the progress made in information technology in the last thirty years. Actuaries are able to simplify the number crunching involved in the science, saving money as well as time. It is not surprising that actuaries are very well paid and considered to be among the top professions in the world. However in a simpler sense actuarial science is employed by nearly everyone when we assess any type of risk.
• In the field of life insurance, actuarial science plays an important role by analyzing mortality, application of compound interest, and use of life tables. Actuarial science is also used for life annuities and endowment policies to determine the risk and feasibility of financial contracts.
• Actuarial science is used in the pension industry as well to design and finalize pension plans. The need for modifying and merging pension plans and design is augmented in a market driven economy where mergers and acquisitions are commonplace. The changing demographics of the workforce, changes in competition, and advancement in technology are some of the factors that are taken into consideration when forming pension plans. Therefore the services of an actuary are not just limited to life insurance but extend to other financial products and services as well.
• This science also plays an important role in health insurance by the analyzes of disability, morbidity, mortality, fertility and other contingent events. A branch of actuarial science may include Resource Based Relative Value Scale (RBRVS) which determines how much should be paid to physicians or doctors. The scale varies according to the place; for instance the cost of a medical check-up in New York will be different compared to somewhere in North Dakota.
• There has been a lot of criticism because of the use of actuarial science in the field of pension plans and modern finance. Some of the features of this branch of science are allegedly not compatible with modern economics and finance according to some experts. The use of actuarial science in predicting criminal recidivism has also been criticized as racist and anti-Semitic. However the fact remains that this science is here to stay and helps insurance companies as well as consumers to decrease financial damage caused due to various reasons.

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