How big does a company have to be to benefit from an actuarial analysis? (Photo: Jirapong Manustrong/Shutterstock) How big does a company have to be to benefit from an actuarial analysis? (Photo: Jirapong Manustrong/Shutterstock)

At SIGMA, we often get asked "how big does a company have to be to benefit from an actuarial analysis?" The question usually suggests there is some minimum loss or premium level that would trigger the need for an actuarial analysis.

As you might imagine, it is typically more complicated than simply setting a threshold for premium or losses to determine potential benefit. For example, due to regulatory issues, some smaller clients are required to have an actuarial analysis possibly with a statement of actuarial opinion. Specific coverage issues such as retention and claim frequency may drive a medium sized company to consider alternative risk financing which will drive the need for an actuarial analysis.

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