Memorandum. To: Enhancements to Associate Status in the Institute Document

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1 Memorandum To: All Fellows, Affiliates and Associates of the Canadian Institute of Actuaries From: CIA Board of Directors Associateship Implementation Task Force Date: March 30, 2011 Subject: Enhancements to Associate Status in the Institute Document INTRODUCTION The CIA Board of Directors and the Associateship Implementation Task Force are seeking input from the membership on important changes that will affect Associate enrolment in the Institute. Some of these changes will require adjustments to the CIA Bylaws and a membership vote by advance proxy voting over several weeks in June 2011, and by in-person voting on June 29, 2011 at the General Business Session of the 2011 Annual Meeting in Ottawa. This memo is intended as a briefing on the bylaw changes under consideration. Formal communication of the proposed bylaw changes will commence towards the end of May. We hope that all members will take advantage of the opportunity to review the materials which accompany this memo and encourage you to provide feedback by May 6, 2011 to associatechanges@actuaries.ca. BACKGROUND The Eligibility and Education Council (EEC) formed the Task Force to Enhance the Value Proposition of Associate Status in the Institute ( the original task force ) to look at potential ways to enhance the perceived and actual value of acquiring Associate status in the Institute, and to develop a communication and marketing plan to promote and increase Associate enrolments. A copy of the original task force s full report is attached. Associates are very important to the CIA, as many will go on to become tomorrow s Fellows. Increased participation by Associates at earlier stages of their careers will strengthen the CIA as an organization and provide Associates with the critical professional framework that will help shape their future. Associates who have been enrolled in the CIA for five or more years have demonstrated their commitment to the profession and should be rewarded with additional rights and privileges, such as voting. The EEC and the CIA Board are in favour of implementing the majority of the original task force s recommendations which will bring the eligibility requirements for Associates of the CIA in line with the eligibility requirements for Associates of the Casualty Actuarial Society (CAS)

2 and the Society of Actuaries (SOA). For convenience, a table summarizing these changes is provided at the end of this memo. In addition, the EEC and the CIA Board considered other changes to the Institute s eligibility criteria, and unanimously supported establishing an Associate of the Canadian Institute of Actuaries (ACIA) designation. A copy of the EEC s memo of recommendations to the CIA Board on November 29, 2010 is attached. The ability to attain the ACIA designation would be a significant benefit to actuarial candidates in Canada who have achieved the ASA, ACAS or Chartered Enterprise Risk Analyst (CERA) designation. It will also provide individuals with the opportunity to achieve an Associate-level designation through the CIA s University Accreditation Program (UAP). Until the SOA and CAS recognize the UAP, this may be the only route to an Associate-level designation for some actuarial candidates in Canada. Introduction of the ACIA designation will encourage actuarial students to enrol earlier, giving them access to the professional guidance that will strengthen their careers and their potential contribution back to the Institute. An ACIA designation also supports the original task force s goal of aligning the eligibility requirements for an Associate of the CIA with those of the SOA and CAS. It should be noted the Policy on the Use of CIA Membership Titles and Designations would be updated to reflect the new rights of Associates; however, the position of the CIA on the use of the term actuary would not change. The term actuary should continue to be used only in reference to a person who is a qualified Fellow. It is also noted that in addition to the U.S., the UK and Australia both have Associate-level designations (AFA/AIA/AIAA). In discussion with the UK regarding the renewal of our Mutual Recognition Agreement (MRA), an MRA at the Associate level has been proposed, which they have initiated with other actuarial associations. BYLAW CHANGES In order to implement the ACIA designation as well as the granting of voting rights for Associates after five years, bylaw changes are required which need to be confirmed by members. A membership vote will take place at the CIA Annual Meeting on June 29, 2011 in Ottawa. A proxy voting period will be available in advance of the meeting. The draft bylaw changes and the proxy voting timeline will be announced in May 2011 following approval by the Board and in accordance with the Policy on Meetings of Members Convened by the CIA Board. EFFECTIVE DATE It is proposed that all changes, including those changes which require member confirmation, be effective June 1, This also means that effective June 1, 2013, new Fellow applicants will be required to have accrued their 12 months of Canadian experience while enrolled as an Associate. EXISTING ASSOCIATES 1. ACIA Designation Any existing CIA Associates who meet the new eligibility requirements will automatically be awarded the ACIA designation. Based on information currently available to the Secretariat, approximately 100 current Associates may not meet the new requirements. If the information on record is up to date, these 2

3 individuals will not be entitled to remain as Associates of the Institute after June 1, 2012, nor will they be able to use the ACIA designation, nor would they acquire voting rights. For these individuals whose records do not currently meet the new requirements, the following options will be available: 1. By June 1, 2012, provide information to the Secretariat that demonstrates that they have met all new requirements for Associate status in the Institute and be granted the ACIA along with the other Associates; 2. Become part of the proposed Actuarial Networking Group (name to be confirmed by the New Member Committee and Member Services Council) as of June 1, 2012 until they meet the new requirements; or 3. Become part of the Actuarial Networking Group permanently. 2. Voting Rights As of June 1, 2012, voting rights will be granted to individuals who are enrolled as Associates as of June 1, 2012, and who have been enrolled for at least five years as an Associate of the CIA. This would include any years that the individual was enrolled as an Associate as that term will be understood as of June 1, 2012 (i.e., based on the new eligibility requirements), as well as any years that the individual was enrolled as an Associate as that term was understood before June 1, 2012 (i.e., based on the previous eligibility requirements). 3. Dues Adjustments a) Effective June 1, 2012, individuals who are enrolled as Associates as of June 1, 2012, and who have been enrolled for at least five years as an Associate of the CIA will pay 85 percent of the dues paid by Fellows of the Institute. This would include any years that the individual was enrolled as an Associate as that term will be understood as of June 1, 2012, as well as any years that the individual was enrolled as an Associate as that term was understood before June 1, b) Effective June 1, 2012, individuals who are enrolled as Associates as of June 1, 2012, and who have been enrolled for less than five years as an Associate of the CIA will pay 30 percent of the dues paid by Fellows of the Institute. This would include any years that the individual was enrolled as an Associate as that term will be understood as of June 1, 2012, as well as any years that the individual was enrolled as an Associate as that term was understood before June 1, ACTUARIAL NETWORKING GROUP The original task force recommended the development of a student type of enrolment in the Institute. In the end, it was not recommended that an official membership category be created, but rather a more informal, networking type group be formed. This group would have an listserver created for it to allow discussions as well as targeted announcements from the Secretariat. Members of this networking group would pay a modest level of dues and would have access to a subset of the members section of the website, and could potentially have special pricing for meetings, events, and webcasts; however, they would not be considered to be members of the CIA and therefore would not be subject to the CIA s Rules of Professional Conduct. University students, and other individuals interested in becoming or remaining connected to the Institute but who do not qualify for membership, could join this Actuarial Networking Group. 3

4 NEW MEMBER COMMITTEE A New Member Committee (name to be confirmed) will be established by the Member Services Council with at least half of the members being Associates. The mandate of this committee will be to promote education and networking opportunities specifically targeted to new Fellows, Associates and university students. FEEDBACK As mentioned previously, a formal announcement including the draft bylaw changes and the details of the voting procedures will follow in May 2011, in accordance with the Policy on Meetings of Members Convened by the CIA Board and the Policy on Proxy Voting. In the interim, this memo is intended to provide the membership with advance notice of these significant changes, and to seek feedback. We encourage you to send your comments by May 6, 2011 to: associatechanges@actuaries.ca. SUMMARY OF CHANGES The following table summarizes the Associate status before and after the recommended changes: Current CIA Associate Proposed CIA Associate Eligibility Criteria Three VEE courses and five preliminary exams ASA, ACAS or CERA 1 Canadian Professionalism Course 2 Not required Required CPD Requirements Same as Fellows Same as Fellows Annual Dues (as % of Fellows) 50 percent for first 10 years, 69 percent thereafter 30 percent for first five years, 85 percent thereafter 3 ACIA Designation No Yes 4 Voting Rights None After five years 5 Discipline Same as Fellows Same as Fellows There is also an important proposed change in the experience requirements for fellowship: 1 The candidate would be eligible for CIA Associate as long as they met the criteria for ASA, ACAS or CERA regardless of whether or not they actually held the other designation. 2 Or equivalent Canadian professionalism workshop. 3 Dues adjustments to be effective June 1, 2012 for membership year. 4, 5 Subject to confirmation by the membership in June

5 Fellowship Experience Requirements Current Three years of full-time experience, including 18 months of Canadian experience Proposed Three years of full-time experience, including 12 months of Canadian experience while enrolled as an Associate in the CIA It should also be noted that currently Affiliates of the CIA pay the same annual dues as Associates. Under the new structure, Affiliate membership dues will be aligned to the dues for Associates under five years (30 percent of Fellow dues), effective June 1,