Hélène Pouliot, FCIA
President of the Canadian Institute of Actuaries
Learn how actuaries measure potential bias and guide businesses toward more equitable decisions with their skills in risk assessment.
Bias is usually defined as someone’s discriminatory actions and attitudes toward certain groups of people. While this type of bias is important to define for guiding moral behaviour, bias also arises in business when decisions are made based on improper data collection and improper models and assumptions. The Canadian Institute of Actuaries is playing an important role in evaluating and addressing these types of bias and guiding businesses toward more equitable decisions.
Actuaries are experts in assessing risk, and we work within an ethical framework to evaluate and address potential bias in many areas of business.
In Canada, the actuarial profession is self-regulated through a code of conduct based on the principles of objectivity, integrity and professional competence. Actuaries are experts in assessing risk, and we work within an ethical framework to detect, evaluate and mitigate potential bias in risk assessment. The way we assess for bias could include steps like identifying vulnerable groups and any potential harm to them, considering the data and measurement approaches being used, and reviewing the assumptions and models being applied.
Addressing bias in business decisions
As business processes become more automated, improper data collection and risk modelling can introduce bias into decision-making and create outcomes deemed unfair for certain groups of people. For example, bias in insurance models could mean some groups are charged unjustifiably higher or lower insurance premiums, leading to a discussion on what is a fair price to charge. We help define the metrics and methods to avoid these biases, making sure that a greater visibility is brought forward. Our recent publication, Bias and Fairness in Pricing and Underwriting of Property and Casualty (P&C) Risks, is one example of how we are helping lead the way in addressing bias in insurance.
We believe that all business managers and leaders can demonstrate their commitment to equity and fairness by incorporating actuarial recommendations into their decision process. It’s a valuable way for all organizations and professionals to stay ahead of the curve on issues of bias and discrimination. The Canadian Institute of Actuaries is committed to building a Canada that is diverse and inclusive and to helping all Canadians face the future with confidence.
Learn how actuaries are helping lead the way in addressing bias in insurance. Explore the Canadian Institute of Actuaries’ recent publication, Bias and Fairness in Pricing and Underwriting of Property and Casualty (P&C) Risks.