6 Questions to Ask When Hiring a Pension Actuary for Your Plan

From supporting your current pension plan to preparing for a valuation, asking the right questions can help you find a partner who supports your long-term financial and compliance goals. In this article, we provide 6 questions to consider when determining whether a pension actuary fits the needs of your organization.  

1. Has the Actuary Worked with Plans Like Yours?  

Pension actuaries may have more experience in different industries, plan sizes, plan types, and more. An actuary who has worked on similar projects to yours may be able to provide greater insights than an actuary who has not. The credentials they hold can also be an additional indicator of the type of expertise you can expect.  

2. How Does the Actuary Determine Valuation Assumptions and Methods? 

Understanding how your actuary arrives at their assumptions and methods, as well as how often they update them, can provide a window into the accuracy and reliability of their results. Does the actuary set aside time each year with you to understand your company’s current circumstances and review the viability of the assumptions given this context?   

3. Will the Actuary Serve as a Strategic Partner for Your Organization? 

While annual valuations and government filings are standard services for an actuary, is your actuary willing and able to provide analysis and recommendations around funding strategies, pension de-risking options, and other plan cost management initiatives? Will your actuary work with you to understand your company’s situation and provide advice on the plan’s design and objectives? 

4. How Will the Actuary Support Communication and Compliance?  

Finding an actuary who can communicate the challenges and benefits of their services to non-actuaries can benefit internal decision-making. Consistency of communication and who the actuary will communicate with should also be considered. Will there be a single contact? How quickly do they typically respond? Will they provide information or present it directly to leadership? Beyond standard updates, how will they keep you informed on pension regulations and compliance? These differences can help you select between two actuaries that meet your basic needs.  

5. What Are the Actuary’s Additional Services and Fees?  

Some plans may require additional services down the road, such as plan design, pension de-risking analysis, funding and/or financial reporting forecasting, plan termination support, etc. Discuss what your actuary provides, how much any additional services may cost, and how they structure their fees. 

6. How Do They Handle Transitions?  

An experienced firm should have a defined onboarding process that helps reduce the risk of errors. If you’re moving to a new actuarial firm, what processes do they have in place to protect your organization? Ask how they coordinate with your current actuary, validate historical data, and minimize disruptions during the transition.  

Finding the Right Actuary for Your Organization 

The right actuary should help your organization understand risks and make informed funding decisions. These questions can help you choose a partner that supports your plan today and into the future. 

If you’re looking for actuarial support, we’re here to help you navigate complex regulations and create sustainable strategies for your pension plan. Click here to learn more about October Three’s actuarial consulting services and how we can help your organization meet its goals.