If you’re reading this, you’re probably gearing up for an actuarial case study interview—a crucial step in landing a job at an insurance company or consulting firm. These interviews can feel daunting, especially when you’re handed a realistic insurance pricing problem and asked to solve it on the spot. But here’s the good news: with the right approach, you can break down even the most complex case into manageable steps, impress your interviewer, and walk out feeling confident. I’ve been through these interviews myself, helped others prepare, and even sat on the other side of the table. What I’ve learned is that success isn’t about having all the answers—it’s about showing you can think clearly, ask the right questions, and structure your analysis in a way that’s both rigorous and practical.
Let’s get one thing straight: actuarial case interviews are different from your typical math test. Sure, technical skills matter, but interviewers are really looking for how you approach problems, communicate your reasoning, and adapt to new information. They want to see if you can think like an actuary—balancing quantitative analysis with business judgment, and making recommendations that are grounded in both data and real-world constraints. That’s why memorizing formulas or frameworks isn’t enough. You need a flexible, repeatable process that works for any case, whether it’s about pricing a new insurance product, evaluating risk, or entering a new market.
In this article, I’ll walk you through a three-step framework for solving realistic insurance pricing problems in case interviews. I’ll share practical examples, insider tips, and common pitfalls to avoid. You’ll learn how to clarify the problem, build a custom framework, and test your assumptions—skills that will serve you well not just in interviews, but throughout your actuarial career. Whether you’re a student preparing for your first interview or a professional looking to switch roles, this guide will give you the tools and confidence you need to stand out.
Step 1: Clarify the Problem and Ask the Right Questions #
The first thing most candidates do wrong is jump straight into calculations without fully understanding the problem. It’s easy to panic and start crunching numbers, but resist the urge. Instead, take a deep breath and ask clarifying questions. This shows you’re thoughtful, curious, and focused on solving the real issue—not just showing off your math skills.
For example, imagine you’re given a case about pricing a new cyber insurance product. Before you dive in, ask: What’s the target market? Are there any regulatory constraints? What’s the claims history for similar products? What are the company’s profit goals? These questions help you tailor your approach and avoid wasting time on irrelevant details. Interviewers appreciate candidates who pause to understand the context, because that’s exactly what you’d do on the job[2].
One trick I’ve found helpful is to restate the problem in your own words and confirm your understanding with the interviewer. Something like, “Just to make sure I understand, we’re being asked to recommend a pricing strategy for a new cyber insurance product aimed at small businesses in the US, with a target loss ratio of 65%. Is that correct?” This not only clarifies the scope but also builds rapport and shows you’re engaged.
Don’t be afraid to ask for missing information. In real life, actuaries rarely have perfect data. If you’re not given the claims frequency or severity, say so: “I’ll need to make some assumptions about claims frequency. Would you like me to proceed with industry averages, or do you have specific data?” This demonstrates professionalism and pragmatism—qualities every employer values.
Step 2: Build a Custom Framework—Don’t Just Recite a Template #
Now that you understand the problem, it’s time to structure your analysis. Many candidates make the mistake of forcing a memorized framework onto the case, which can come across as rigid or out of touch. The best candidates adapt their thinking to the specific problem, using frameworks as inspiration rather than a script[3].
Start by jotting down the main components of the problem. For an insurance pricing case, these might include: market analysis, risk assessment, claims modeling, expense structure, regulatory environment, and competitive landscape. Break each component into sub-questions. For example, under risk assessment, you might consider: What are the main perils? How volatile are claims? Are there any emerging risks?
Here’s a practical example. Suppose you’re asked to price a new pet insurance product. Your framework could look like this:
- Market Analysis: Who is the target customer? What’s the size of the market? Are there trends in pet ownership or veterinary costs?
- Risk Assessment: What are the most common claims (e.g., accidents, illnesses)? How do these vary by breed, age, or region?
- Claims Modeling: What’s the expected frequency and severity of claims? How might these change over time?
- Expense Structure: What are the acquisition, underwriting, and administrative costs? How do commissions and distribution channels affect pricing?
- Regulatory Environment: Are there any state or federal regulations that impact pricing or product design?
- Competitive Landscape: What are competitors charging? How differentiated is our product?
Notice how this framework is tailored to the case, not just a generic list. You’re not reciting Porter’s Five Forces or the 4Ps—you’re building a structure that fits the problem at hand[3]. This approach shows you can think critically and creatively, which is exactly what interviewers want to see.
Once you’ve sketched out your framework, walk the interviewer through it. Explain why you’re focusing on each area and how they connect. This not only keeps you organized but also invites feedback. If the interviewer steers you in a different direction, adjust your framework on the fly. Flexibility is key.
Step 3: Test Your Hypothesis with Data and Judgment #
With your framework in place, it’s time to dive into the analysis. But here’s where many candidates stumble: they either get lost in the details or ignore the data altogether. The goal is to strike a balance—using numbers to support your reasoning, but also applying business judgment when data is scarce or uncertain.
Start by forming a hypothesis. For example, “Based on the market analysis, I suspect that pet insurance is underpenetrated in the US, and we can price competitively while maintaining a healthy margin.” This hypothesis guides your investigation and keeps you focused on what matters most[2].
Next, gather the data you need to test your hypothesis. If you’re given historical claims data, use it to estimate frequency and severity. If not, make reasonable assumptions and state them clearly. For instance, “I’ll assume an average annual claim frequency of 0.2 per policy, based on industry benchmarks. If you have actual data, I can refine this estimate.”
As you work through the numbers, keep an eye on the big picture. Are your assumptions realistic? Do the results make sense in the context of the market and the company’s goals? If your calculations suggest a premium that’s much higher than competitors’, ask yourself why. Maybe you’re overestimating claims, or perhaps there’s a cost-saving opportunity you haven’t considered.
Don’t be afraid to iterate. If your initial hypothesis doesn’t hold up, refine it. For example, if the data shows that claims are higher than expected, you might need to adjust your pricing or consider risk mitigation strategies like exclusions or deductibles. The ability to pivot based on new information is a hallmark of a strong candidate.
Finally, wrap up your analysis with a clear recommendation. Summarize your key findings, explain any trade-offs, and suggest next steps. For example, “Based on my analysis, I recommend launching the pet insurance product at a premium of $35 per month, with a deductible of $250. This balances competitiveness with profitability, and we should monitor claims closely in the first year to refine our pricing.”
Practical Examples and Common Pitfalls #
Let’s look at a concrete example to tie it all together. Imagine you’re interviewing for a role at a mid-sized insurer and are given the following case:
The company is considering entering the travel insurance market in Southeast Asia. They want you to recommend whether to proceed, and if so, how to price the product.
Step 1: Clarify the Problem
Ask about the target customer (e.g., leisure vs. business travelers), the countries involved, regulatory requirements, and the company’s strategic goals. Confirm whether the focus is on pricing, market entry, or both.
Step 2: Build a Custom Framework
Your framework might include: market size and growth, customer segmentation, risk profile (e.g., medical emergencies, trip cancellations), claims history (if available), expense structure, regulatory hurdles, and competitive analysis. Break each into specific questions, like “What’s the incidence of medical emergencies in Thailand?” or “How do local regulations affect policy terms?”
Step 3: Test Your Hypothesis
Suppose you hypothesize that the market is attractive due to rising tourism, but claims may be higher than in more mature markets. Gather data on tourism trends, medical costs, and competitor premiums. Model expected claims and expenses, and compare to potential revenue. If the numbers look tight, consider ways to reduce risk, such as partnering with local hospitals or offering add-on services.
Recommendation
Present your findings clearly: “I recommend entering the market with a focus on leisure travelers, offering comprehensive coverage at a 15% premium to local competitors. We should invest in partnerships with healthcare providers to control claims costs and monitor performance closely.”
Throughout the process, avoid common pitfalls like ignoring the business context, sticking rigidly to a framework, or failing to communicate your reasoning. Remember, the interviewer cares as much about how you think as what you conclude.
Actionable Advice and Personal Insights #
Here are a few tips I’ve picked up over the years—some obvious, some less so:
- Practice with a Timer: Case interviews are time-pressured. Practice building frameworks and doing calculations under time constraints. Aim for 30–60 seconds to structure your thoughts before diving in[4].
- Sketch Your Framework: Draw a quick issue tree or flowchart. This helps you organize your ideas and makes it easier to explain your approach to the interviewer[4].
- Explain Your Assumptions: Always state your assumptions out loud. This shows transparency and invites the interviewer to correct you if you’re off track.
- Prioritize: Not all parts of the framework are equally important. Focus on the areas that will have the biggest impact on the recommendation.
- Stay Calm Under Pressure: If you get stuck, take a breath and ask for help. Interviewers respect candidates who know their limits and collaborate.
- Learn from Every Case: After each practice case, reflect on what went well and what could be improved. Over time, you’ll develop a reliable process that works for you.
One personal insight: I’ve seen candidates who aced the technical side but failed to connect with the interviewer. Remember, this is a conversation, not an exam. Engage with your interviewer, ask thoughtful questions, and show genuine curiosity about the business problem. That human touch can make all the difference.
Relevant Statistics and Facts #
While every case is unique, it helps to have some industry facts at your fingertips. For example:
- The global insurance market was valued at over $5 trillion in 2023, with life and health insurance accounting for the largest share, but property and casualty (including specialty lines like cyber and pet) growing rapidly.
- In the US, pet insurance penetration is still below 5%, compared to over 25% in some European countries—a sign of both challenge and opportunity for insurers.
- Cyber insurance premiums have been rising by double digits annually, reflecting increased claims frequency and severity as cyber threats evolve.
These stats can add credibility to your analysis and show you’re informed about industry trends. But don’t force them in—use them where they naturally support your argument.
Final Thoughts #
Acing an actuarial case study interview isn’t about being the smartest person in the room. It’s about demonstrating structured thinking, clear communication, and practical judgment. By clarifying the problem, building a custom framework, and testing your hypothesis with data and logic, you’ll show interviewers you have what it takes to succeed as an actuary.
Remember, even experienced professionals get stumped sometimes. What matters is how you handle uncertainty, adapt to new information, and work collaboratively to find a solution. Practice this three-step framework, learn from each case, and bring your authentic self to the interview. With preparation and the right mindset, you’ll not only survive the case interview—you’ll thrive in it.