The Joint Forum on Actuarial Regulation (JFAR) has identified climate-related risk (including biodiversity) and systemic risk (including Covid-19) as key risk hotspots, while long Covid, mental health and the triple lock are also included.
The regulator recently published its annual risk perspective to highlight its collective view of risks to “high quality” actuarial work.
The forum comprises representatives from the Financial Conduct Authority, the Financial Reporting Council (FRC), the Institute and Faculty of Actuaries, the Prudential Regulation Authority and The Pensions Regulator.
The full list of risks identified in this year’s JFAR risk perspective include climate-related risk (including biodiversity), systemic risk (including the Covid-19 pandemic), ageing population and affordability.
Also included is “unfair outcomes” for individuals, geopolitical, legislative, regulatory risk
technological change and competence in new areas (including machine learning, big data, artificial intelligence), impact of undue commercial pressure as well as effective communication.
Mark Babington, executive director of regulatory standards, said: “Actuaries play a key role in assessing financial risks and providing expert advice on managing those risks.
“This year’s risk perspective has identified a range of key hotspots, from climate-related risk through to some of the longer-term impacts of the Covid-19 pandemic that actuaries should consider in the course of their work.”
He added: “Actuaries, employers and users of actuarial work are encouraged to closely consider these risks in order to promote high quality actuarial work and mitigate risks to the public interest.”