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Guy Avagliano

Consulting Actuary

Milliman & Robertson Inc.

Specialty: Property and casualty insurance

Guy Avagliano works in the rarefied world of property and casualty insurance actuaries. In fact, he is one of only 1,600 full-fledged actuaries in the United States with that specialty.

Their small ranks could have something to do with the rigorous entrance exams that an actuary is required to pass to become a fellow. Only a third of those who take the tests pass, and completing all 10 exams takes, on average, eight to nine years.

Avagliano took seven years, becoming a fellow and consulting actuary in 1993 at 29.

Actuaries basically place a price tag on future risk, including, for example, making sure that insurance companies have enough reserves set aside to pay their claims. Workers compensation, homeowners, automobile and professional liability insurance all fall under the purview of a property and casualty actuary.

His clients include the California State Automobile Association and the Business Insurance Group, the largest private writer of workers compensation policies in the state.

Avagliano has been in the field since he graduated from UCLA with a bachelor’s degree in mathematics and applied science. “I wanted to do something where I could use math and finance,” he said.

Actuaries have standard models in which they input payroll, premiums collected and other data in order to obtain future projections. The actuary then analyzes the results and crosschecks them against several different methods.

Even with the projection models, there is a degree of uncertainty, especially when the underlying environment is unstable. For example, changes in medical costs and benefit levels affect workers compensation.

“The problem we have is not so much projecting losses, but making sense of different projections,” said Avagliano, who has been with Milliman & Robertson for about 10 years. If four methods come up with different results, analysis and judgment come into play.

“He’s very thorough, very detailed, very analytical, very good at doing research before reaching any conclusions,” said Paul Souza, vice president of finance for Business Insurance Group.

Elizabeth Hayes