Chartered Enterprise Risk Analyst (CERA) is a new designation released by the Society of Actuaries (SOA) in 2007. Historically, actuaries have worked in the insurance industry and fields related to the insurance industry, including pensions. However the SOA wants to branch actuaries out into non-traditional fields and the Chartered Enterprise Risk Analyst designation is another step in that direction..
Why SOA Implemented CERA
The SOA, through research and education, advances actuarial knowledge and improves decision making to benefit society. We enhance the ability of actuaries to be trusted financial and business advisors on problems involving uncertain future events. We provide and ensure the integrity and relevance of our credentials.
The actuarial employment landscape has changed a lot in the past few decades. Gains in technology, globalization, risk perception, and number of interested candidates has changed the employment landscape, in both positive and negative ways. The SOA is comprised of licensed actuaries, and from what I can tell from their announcements, have been wanting to diversify the roles for actuaries for a long time now. They want actuaries to be able to get jobs in fields outside traditional insurance and pensions, such as risk management and finance.
Goal of CERA
A new designation–the Chartered Enterprise Risk Analyst (CERA)–is now available to help students and business professionals prepare for and seize opportunities in the evolving discipline of enterprise risk management (ERM) within broader financial services, insurance, and pension markets.
While CERA is focused more on risk management, I believe it is an attempt to diversify actuaries into finance, or at least to expand beyond traditional actuarial roles in insurance companies. For an actuary to change jobs into investment banking is a big stretch. However since insurance is related to risk, branching out into risk is easier step. If it works out, the SOA may introduce new initiatives to give actuaries new employment opportunities.
Requirements of CERA – Actuarial Exams
Exam P (Probability)
Exam FM (Financial Mathematics)
Validation by Educational Experience (VEE) Economics
Exam M (Actuarial Models) segment MFE
Exam C (Construction of Actuarial Models)
FSA–level Finance/ERM Exam (Advanced Finance/Enterprise Risk Management)
FSA–level Finance/ERM Module (Financial Reporting and Operational Risk–FSA Module Introduction, Operational Risk Section (Section 11) and End–of–Module Exercise only)*
Associateship Professionalism Course
How does CERA compare to CFA, FRM, etc.?
Is CERA worth it? That’s what most people are asking. I believe the answer is no.
Let’s look at employment figures. After all, employment is the reason why people might consider pursuing the CERA designation. The Chartered Financial Analyst (CFA) designation is more for finance – portfolio management, while FRM can be said to be also competing for the risk management space.
For this, we look at two major job sites, Workopolis and Monster. Workopolis provides good coverage of Canadian actuarial jobs and Monster provides good coverage of US actuarial jobs. Please see our other article on how to use these sites to search for actuarial jobs in Canada and the US.
For this study, we look at the following search terms: CERA, CFA, FRM (representing each designation respectively)
We examine the raw number of results returned by each search. What does this measure? It measures how often the designation appears in the job description, and is a proxy measure for how many jobs would require it. What this won’t show is the average pay or other quality of the jobs.
Searching for the CERA designation yields 0 jobs.
Searching for the CFA designation yields 182 jobs.
Searching for the FRM designation yields 12 jobs.
Conclusion – Get CFA instead of CERA
A SOA/CAS designation along with the CFA charter would serve you much better than a CERA designation. A FSA or FCAS designation makes you more qualified for actuarial work than a CERA. A CFA designation makes you more qualified for finance than a CERA. A FRM gives you more opportunities in risk management than a CERA. So in the end, there’s no reason whatsoever to get a CERA.