President's Message (October 15, 2009)

News from the American Academy of Actuaries

Ken Hohman

Allow me to introduce myself. My name is Ken Hohman and, as of yesterday afternoon, I am the new president of the American Academy of Actuaries. At yesterday's annual meeting in Boston, held in conjunction with the Society of Actuaries annual meeting, John Parks passed the gavel to me and four new directors were elected to our board.

You had undoubtedly heard that this meeting might be contentious, and indeed, nominations were made from the floor, and proxy votes were tendered for the first time in our history. However, all those who attended should be complimented for their professionalism and civility. I hope all of you will join me in congratulating and supporting Mary D. Miller, Dave Neve, Tom Wildsmith and Ron Gebhardtsbauer (completing one year of an unexpired term) in their new role as Academy board members.

Access the following link for brief bios on these individuals here.

Our agenda for the next year will continue to focus on the public policy and professionalism work of the Academy. We have been, and will continue to be a focal point for unbiased information, particularly in the health care reform debate. We are also addressing the cause and fallout of the financial crisis, demonstrating the credibility of actuaries beyond the world of insurance and pensions. And, we are seeking to make more transparent the discipline and standard setting process.

But my personal agenda will be to improve our communication with members and to critically review our governance processes and procedures. This will be the first of a regular series of emails keeping members informed of the Academy's progress. I apologize if this is an inconvenient mechanism for reaching you, but newsletters, Contingencies articles and Web postings have not proved effective in the past. If you have suggestions for how to improve our member communications, please send your ideas to communications@actuary.org. I hope you will take a couple of minutes from your busy schedule to read these emails.

Most of you are aware that I accepted this position under unique circumstances. The 2009 president-elect was removed by the board of directors of the Academy. It is understandable that our members are curious why this action was taken but there are confidentiality concerns that inhibit what we can say. Additionally there was a lawsuit and subsequent settlement.

I was not part of the board when these actions were taken but from my perspective, the directors thoughtfully fulfilled their duty to act in the best interest of the Academy and our members. These are individuals of integrity and they did not take these actions lightly. While the Academy was confident that it could prevail in the subsequent lawsuit, it determined that to do so would have been costly and distracted our valuable volunteer resources from our mission. We have prudently maintained a reserve fund for unexpected expenses and were able to pay the settlement costs from the reserve.

At its October 20, 2009 meeting the board of directors voted a $10 dues increase for members for 2010, for a dues payment of $595. Let me make clear again, the settlement agreement had no effect on our 2010 dues because it was completely satisfied by reserves. The dues increase simply recognizes the increasing operating cost to provide policy statements and education to the legislators and regulators that impact the work of actuaries. If you were not aware, the Academy posts a summary of board actions on the members only section of our website, generally within a couple of weeks following the meeting.

Thank you for taking the time to read this letter, and I will do my best to keep future updates brief.

Ken Hohman
President
American Academy of Actuaries