Research Services - Artificial Intelligence (AI) and Machine Learning (ML) in Actuarial Modelling in the UK

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***THIS IS A CONTRACT AWARD NOTICE*** The Financial Reporting Council (FRC) regulates auditors, accountants and actuaries and sets the UK's Corporate Governance and Stewardship Codes. We seek to promote transparency and integrity in business; our work is aimed at investors and others who rely on company accounts, audit, and high-quality risk management. The use of Artificial Intelligence (AI) and Machine Learning (ML) is growing in actuarial modelling. The Institute and Faculty of Actuaries (IFoA), the UK's professional association for actuaries, has been encouraging education and training in these techniques among its members and recently launched a data science certification The objective of this research is to learn more about the role of AI/ML in UK actuarial modelling practices across pensions, life insurance, general insurance, and wider fields (e.g., banking and investment). It will also compare the extent of AI/ML deployment by the actuarial profession with that of other similar professions. The overall purpose of the research is to improve our understanding of new risks that AI/ML might bring to the quality of actuarial work. To do this, the research will address the following four areas of enquiry: 1. Areas of use: Which actuarial departments are involved in using AI and ML techniques in their work? 2. Approach: What approach(es) and technique(s) are used? How are they selected? 3. Governance: What is the governance process around the use of AI and ML techniques as compared to the governance process around the more traditional techniques? 4. Output: How do the areas of use, approach and governance of AI and ML impact on a. the way outputs are used internally by a company, and b. the uncertainty around the actuarial modelling results using AI/ML, as compared to the uncertainty around results from the more traditional approaches? ***AWARD NOTICE***