Andreas Milidonis
University of Cyprus
Actuarial Independence and Managerial Discretion.
- Actuarial independence is important when appointed actuaries oversee insurance reserves.
- In-house appointed actuaries could be officers or non-officers of the company.
- Officer actuaries face managerial incentives that could jeopardize actuarial independence.
- Using data from 2007-2014, we find that in-house officer actuaries are less conservative than non-officer actuaries.
- Results are economically significant and should be of concern to regulators and professional institutions.