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Statistics and Actuarial Science

During the 20th century, probability and statistics developed into an important scientific discipline essential to all fields of study that rely on information obtained from data. Author H.G. Wells acknowledged the importance of statistical reasoning when he stated, "Statistical thinking will one day be as necessary for efficient citizenship as the ability to read and write."

Today's world is bombarded with numerical information. Informed decisions rely on the ability to separate fact from fiction by applying valid statistical analyses. Statisticians can provide crucial guidance in determining what information is reliable and which predictions may be trusted. They often help search for clues to the solution of a scientific mystery and sometimes keep investigators from being misled by false impressions.

The work of a statistician may range from the theoretical (developing new methodologies and statistical theory) to the applied (working with scientists and decision makers to collect, analyze, and interpret data). Regardless of the areas in which they work, statisticians need a strong background in mathematics and computer use. Because uncertainty and data arise in many settings, statisticians have the opportunity to work on a variety of projects in industry, education, government, and research. Thousands of statisticians work in medicine, law, agriculture, public policy, marketing, manufacturing, engineering, and other fields in the social and natural sciences. The diversity of applications is an exciting aspect of the field and is one reason why the demand for well-trained statisticians continues to be strong.

An actuary is a business executive, professionally trained in the mathematical sciences. Actuaries specialize in the evaluation of financial risk--most often in the context of life, health, and casualty insurance, where they design, analyze, and refine various programs to meet the insurance needs of society. Most actuaries are employed by insurance companies, where they have responsibilities for all phases of the development and maintenance of their company's products. They have considerable influence on the financial soundness of their company through work in pricing insurance policies and in compiling data for financial statements.

Many actuaries are employed as consultants. Their actuarial services are used by smaller insurance companies and by individual employers who need actuarial guidance in establishing insurance and retirement programs for their employees. A growing number of actuaries work in the areas of asset/liability management and risk management. Some of these actuaries are employed by investment and consulting firms; others are employed by insurance companies.

Actuaries have been called financial architects and social mathematicians, because their combined analytical and business skills help to solve a growing variety of financial and social problems. The actuarial profession is a demanding yet rewarding career choice.

Graduates of the Department of Statistics and Actuarial Science have enjoyed great success in finding employment at all levels of the profession's fields.

Undergraduate Programs

The department offers a Bachelor of Science in statistics and in actuarial science, and a minor in statistics.

Bachelor of Science in Statistics

The Bachelor of Science in statistics requires a minimum of 120 s.h., including 46 s.h. of work for the major. Students complete 10 core courses that provide essential instruction in statistical methods, applications, and theory. In addition, they concentrate on their particular interest areas by choosing one of the following three emphasis tracks, in which they complete at least four courses.

The statistics in business, industry, government, and research track emphasizes statistical applications and data analysis. It is appropriate for students interested in careers as applied statisticians.

The statistical computing track emphasizes statistical applications and requires additional course work in computing. It prepares students for statistical work that requires computing expertise for data management, analysis, and reporting.

The mathematics statistics track provides a solid foundation in statistical theory and applications. It requires additional course work in mathematics and is good preparation for graduate study in statistics.

Students must complete the College of Liberal Arts and Sciences General Education Program.

The major in statistics requires the following course work.

CORE COURSES

All students complete the following.

Computer Science 

Mathematics 

Statistics 

The department recommends that well-prepared students who elect the mathematical statistics track take 22S:153 Mathematical Statistics I and 22S:154 Mathematical Statistics II in place of 22S:130 Introduction to Mathematical Statistics I and 22S:131 Introduction to Mathematical Statistics II to satisfy the core requirement in statistics.

Emphasis Tracks

Students take four courses from one of the following tracks.

STATISTICS IN BUSINESS, INDUSTRY, GOVERNMENT, AND RESEARCH 

Three of these: 

STATISTICAL COMPUTING 

Two of these: 

MATHEMATICAL STATISTICS 

One of these: 

Two of these: 

If 22S:153 Mathematical Statistics I and 22S:154 Mathematical Statistics II are used to satisfy the core requirements, they may not be used to satisfy the track requirement.

Bachelor of Science in Actuarial Science

The Bachelor of Science in actuarial science requires a minimum of 120 s.h., including 59 s.h. of work for the major. The program prepares students for careers as actuaries. It also helps them learn material that is included in professional examinations administered by the Casualty Actuarial Society and/or the Society of Actuaries, which actuaries must pass in order to achieve professional status. The examinations are challenging; mastering the examination material requires tenacity and a substantial commitment of time.

Students take a variety of actuarial science courses. In addition, preparation for business aspects of the actuarial profession requires the study of accounting, law, finance, insurance, and economics. Courses relating to communication skills, such as writing and speaking, are also important.

Students must complete the College of Liberal Arts and Sciences General Education Program.

Due to the demanding nature of the actuarial science major and the difficulty of the professional examinations, the department maintains a selective admission program for actuarial science. Students must apply and be admitted to the major.

Students interested in becoming actuaries should declare an interest in actuarial science as their major when they enter the University. Ordinarily, students apply for admission to the actuarial science major in the fall semester of their sophomore year, after they have taken 22M:055 Fundamental Properties of Spaces and Functions I and 22S:130 Introduction to Mathematical Statistics I. Students should apply no later than the end of the spring semester of their junior year.

Students admitted to the actuarial science major usually have completed at least 40 s.h. at the University or at another postsecondary institution, including a three- or four-course calculus sequence, a course in linear algebra, and a calculus-based course in probability and statistics. The admission decision is based on the student's performance in these courses and other courses relevant to success in the major. The student's grades from semester to semester also are considered. ACT or SAT scores are considered in evaluating transfer students. Factors such as work ethic, enthusiasm, and commitment may be considered.

Students who have a thorough understanding of mathematics, as reflected by their performance in prerequisite math course work, tend to be most successful in actuarial science.

For application forms and more information about selective admission, contact the Department of Statistics and Actuarial Science.

Permission to substitute course work taken at another institution for required courses at Iowa is decided case-by-case.

The B.S. in actuarial science requires the following course work.

Computer Science 

Economics 

Mathematics 

Statistics and Actuarial Science 

In exceptional cases, the advisor may grant permission to waive 22S:130 Introduction to Mathematical Statistics I and/or 22S:131 Introduction to Mathematical Statistics II.

Sample Schedule

The following is a sample schedule for completing actuarial science degree requirements.

FIRST YEAR

Fall Semester 

Spring Semester 

SECOND YEAR

Fall Semester 

Spring Semester 

THIRD YEAR

Fall Semester 

Spring Semester 

FOURTH YEAR

Fall Semester 

Four-Year Graduation Plan

The following checkpoints list the minimum requirements students must complete by certain semesters in order to stay on the University's Four-Year Graduation Plan. (Courses in the major are those required to complete the major; they may be offered by departments other than the major department.)

Much of the work in the discipline is sequential, so students must begin requirements for the major as soon as possible. Individual study plans must be made carefully. Students who first enroll for a spring semester must consult the department to confirm a four-year plan.

B.S. in Statistics

Courses must be taken in sequence, so students must begin work early.

Before the third semester begins: three courses in the major, including 22M:025 Calculus I, 22M:026 Calculus II, and 22S:030 Statistical Methods and Computing; and at least one-quarter of the semester hours required for graduation

Before the fifth semester begins: four courses in the major and at least one-half of the semester hours required for graduation

Before the seventh semester begins: seven or eight courses in the major and at least three-quarters of the semester hours required for graduation

Before the eighth semester begins: nine or ten courses in the major

During the eighth semester: enrollment in all remaining course work in the major, all remaining General Education courses, and a sufficient number of semester hours to graduate

B.S. in Actuarial Science

Before the third semester begins: 22M:025 Calculus I, 22M:026 Calculus II, 22M:027 Introduction to Linear Algebra, and at least one-quarter of the semester hours required for graduation

Before the fifth semester begins: 22M:055 Fundamental Properties of Spaces and Functions I, 22M:056 Fundamental Properties of Spaces and Functions II, 22S:130 Introduction to Mathematical Statistics I, 22S:131 Introduction to Mathematical Statistics II, 22S:180 Mathematics of Finance I, and at least one-half of the semester hours required for graduation

Before the seventh semester begins: 22C:016 Computer Science I: Fundamentals, 22S:153 Mathematical Statistics I,  22S:154 Mathematical Statistics II, 22S:174 Quantitative Methods for Actuaries, 22S:175 Actuarial Models, 22S:181 Life Contingencies I, and at least three-quarters of the semester hours required for graduation

Before the eighth semester begins: 22S:182 Life Contingencies II

During the eighth semester: enrollment in all remaining course work in the major, all remaining General Education courses, and a sufficient number of semester hours to graduate

Honors

Qualified undergraduate students may earn a degree with honors.

To graduate with honors in statistics or in actuarial science, a student must be a member of the University of Iowa Honors Program which requires that students maintain a cumulative University of Iowa g.p.a. of at least 3.33 (contact the University of Iowa Honors Program for more information).

Honors students in statistics also must have a g.p.a. of at least 3.40 in departmental courses required for the major and must complete an honors project or suitable alternative. A student planning to graduate with honors should contact the statistics honors advisor.

Honors students in actuarial science also must have a g.p.a. of at least 3.40 in all departmental courses numbered 120 and above and a cumulative University of Iowa g.p.a. of at least 3.40. They must complete the following three courses in addition to the requirements for the B.S. 

Minor

The minor in statistics requires a minimum of 15 s.h. in statistics courses, including 12 s.h. in 100-level courses taken at The University of Iowa. Students must maintain a g.p.a. of at least 2.00 in the minor. Course work in the minor may not be taken pass/nonpass. The minor requires the following courses:

 Two of these:

Three of these:

There is no minor in actuarial science.

Graduate Programs

The department offers a Master of Science in statistics, with and without thesis; and a Master of Science in statistics with a subtrack in actuarial science, without thesis. It also offers a Doctor of Philosophy in statistics.

Master of Science

The Master of Science in statistics requires a minimum of 34 s.h. of graduate credit, with or without thesis. It prepares students for careers as professional statisticians or for entry into the Ph.D. program. The curriculum includes a solid foundation in statistical computing, regression analysis, experimental design, and mathematical statistics, plus electives in statistical methods and/or theory. Students have the opportunity to concentrate on theory, applications, or a combination of the two.

M.S. students may choose to write a thesis, which substitutes for two elective courses.

Each M.S. nonthesis student has a comprehensive exam committee of three or four faculty members, which is responsible for recommending action on the student's degree.  The recommendation usually is based on two written examinations over topics covered in the required courses.

M.S. thesis students usually have two separate committees responsible for recommending action on their degrees.  The recommendation of the thesis committee usually is based on an oral defense of the thesis, although it also may be based on a single written examination over topics covered in the student's program of study.  The recommendation of the comprehensive exam committee usually is based on two written examinations over topics covered in the required courses.

Thesis Program

The M.S. in statistics with thesis requires the following course work. A computer programming proficiency test is administered early in the first semester. Students who display inadequate programming skills may be required to take an additional programming course.

Each semester in which a graduate student registers for at least 6 s.h., he or she must include at least one 2 s.h. course offered by the Department of Statistics and Actuarial Science, excluding 22S:197 Readings in Statistics and 22S:299 Reading Research. 

At least two of these: 

The typical thesis is a statistical presentation of the results of a meaningful research project in another field, or a study of the characteristics of a new statistical method. The thesis work is directed by a supervising professor.

Nonthesis Program

The following course work is required for the M.S. in statistics without thesis. A computer programming proficiency test is administered early in the first semester. Students who display inadequate programming skills may be required to take an additional programming course.

Each semester in which a graduate student registers for at least 6 s.h., he or she must include at least one 2 s.h. course offered by the Department of Statistics and Actuarial Science, excluding 22S:197 Readings in Statistics and 22S:299 Reading Research. 

At least four of these: 

M.S. with Actuarial Science Subtrack

The Master of Science in statistics with actuarial science subtrack requires 36 s.h. of graduate credit. It is offered without thesis. The program prepares students for actuarial careers by emphasizing the theory that underlies risk processes and the application of this theory to practical problems of insurance pricing and management. The required course work helps students prepare for the professional examinations administered by the Casualty Actuarial Society and/or the Society of Actuaries.

Each M.S. student has a committee of three or four members, which is responsible for recommending action on the student's degree. The committee's recommendation usually is based on two written examinations over topics covered in the required program.

The M.S. in statistics with actuarial science subtrack requires the following course work.

Each semester in which a graduate student registers for at least 6 s.h., he or she must include at least one 2 s.h. course offered by the Department of Statistics and Actuarial Science, excluding 22S:197 Readings in Statistics and 22S:299 Reading Research.

One of these sequences: 

All of these: 

Doctor of Philosophy in Statistics

The Doctor of Philosophy in statistics requires a minimum of 72 s.h. of graduate credit, including work completed in the M.S. program. The program prepares students for careers in research, applications, and teaching.

All Ph.D. students must pass comprehensive exams and write a dissertation. The program takes about three years to complete after the M.S. has been granted. Ph.D. students choose one of four concentration areas for their course work: biostatistics; probability/mathematical statistics; statistical modeling; and actuarial science/financial mathematics.

Biostatistics emphasizes exposure to various biostatistical methods, such as survival analysis, categorical data analysis, and longitudinal data analysis. It prepares students for consulting and other positions in industry.

Probability/mathematical statistics emphasizes a broad, solid foundation in techniques and underpinnings of mathematical statistics. Its focus on breadth and depth is intended to produce well-rounded, knowledgeable scholars. It is excellent preparation for academic positions in mathematical statistics and industrial or government positions that require broadly trained statisticians with a strong understanding of statistical theory.

Statistical modeling emphasizes the theory and application of a broad array of statistical models, such as linear, generalized linear, nonlinear, categorical, spatial, correlated response, and nonparametric regression models. This concentration area prepares students to specify and choose appropriate models; fit the models using available statistical software; and make sound statistical conclusions and interpretive statements. It is excellent preparation for students interested in academic, industrial, or government positions that involve data modeling and analysis.

Actuarial science/financial mathematics emphasizes the theory of actuarial science, finance, and risk management. It is excellent preparation for academic positions in universities that offer actuarial science programs or for positions in the insurance, pension, and financial industries.

The actuarial science/financial mathematics program is highly mathematical and selective. Most students are admitted after earning an M.S. in statistics with actuarial science subtrack at The University of Iowa.

The Ph.D. in statistics requires the following course work.

Each semester in which a graduate student registers for at least 6 s.h., he or she must include at least one 2 s.h. course offered by the Department of Statistics and Actuarial Science, excluding 22S:197 Readings in Statistics and 22S:299 Reading Research.

CORE COURSES 

CONCENTRATION AREA

Students take at least four courses in one of the following concentration areas. At least two of these must be 200-level courses.

Biostatistics 

Probability/Mathematical Statistics 

Statistical Modeling 

Actuarial Science/Financial Mathematics 

OTHER COURSE WORK

During the graduate program, students may take course work or seminars in other departments to achieve the Ph.D. program's auxiliary goals: to relate an area of specialization to other fields of knowledge, to acquire the ability to use electronic digital computing equipment, or to learn the language skills needed to read foreign scientific journals and respond in personal contacts with foreign scholars.

COMPREHENSIVE EXAM

Ph.D. students take a comprehensive examination after completing most of the course work on their approved plan of study, typically during the third year of graduate study.

The comprehensive examination consists of a written core examination and an oral examination on statistical inference, linear models, and probability. These topics are generally covered in 22S:193 Statistical Inference I, 22S:194 Statistical Inference II, 22S:195 Probability and Stochastic Processes I, 22S:203 Foundations of Probability I, 22S:253 Advanced Inference I, and 22S:255 Linear Models. Study guides for the core examination are available from the department. Ph.D. students in the actuarial science track may qualify to take an exam designed by their advisor and approved by the director of graduate studies.

A program that does not conform to the prescribed requirements but is of high quality may be approved by the department chair.

Financial Support

Funds are available to help support outstanding applicants. Fellowships, teaching assistantships, and research assistantships provide an attractive stipend plus resident tuition status and tuition scholarships for students who are appointed at least one-quarter time. In some cases, full tuition waivers are granted.

Students who wish to be considered for financial assistance for their third year in the program should request a Ph.D. candidacy review no later than the spring semester of their second year.

Admission

Applicants must meet the admission requirements of the Graduate College; see the Manual of Rules and Regulations of the Graduate College or the Graduate College section of the Catalog.

Facilities

The Department of Statistics and Actuarial Science is housed in Schaeffer Hall, adjacent to Old Capitol, a National Historic Landmark and the center of campus. The department operates two computer labs in Schaeffer Hall. One, which also is used as an electronic classroom, contains 30 IBM PCs. The second houses 18 high-end UNIX workstations. Students use these labs for both class work and research.