Price It Right!

APU’s Strategic Pricing Workshop Prepares Future Actuaries

Strategic pricing is a core concept for students pursuing an Actuarial Studies degree, focusing on setting the price of insurance products and financial services. It aims to strike a balance between competitiveness, profitability, and risk management.

Pricing optimisation plays a vital role in the insurance industry, ensuring premiums are set appropriately to cover claims and expenses while maintaining financial sustainability.

To enhance actuarial students’ career readiness, the Asia Pacific University of Technology & Innovation (APU) Actuarial Science Club (ASC) organised an insightful session titled Price It Right!: Strategic Pricing Workshop, held on 22 February 2025 on the university campus.

A group photo of Mr Soo Cheng Soon (3rd from right), the guest speaker, with participants of the Price It Right!: Strategic Pricing Workshop and committee members of APU ASC.

Featuring Mr Soo Cheng Soon, Head of Pricing, Portfolio Analytics, and Reinsurance at Tune Protect, the workshop offered students an in-depth understanding of actuarial pricing strategies.

The workshop began with an introduction to core pricing concepts, including pure premium, frequency, and severity—key components in determining insurance premiums.

Mr Soo guided participants through a one-way analysis and explained how various risk factors influence pricing decisions. A critical takeaway from this session was the basic insurance equation, which ensures that collected premiums are sufficient to cover losses, expenses, and profit margins.

This provided students with a solid foundation for understanding how insurers develop sustainable pricing models.

Actuarial Pricing in Action

The guest speaker, Mr Soo Cheng Soon, shared valuable pricing skills with the participants.

A key highlight of the workshop was the deep dive into actuarial pricing methods, where Mr Soo demonstrated how actuaries utilise statistical models and data analysis to estimate insurance premiums.

Participants were introduced to the "dataCar" dataset in R (a statistical programming language), a structured collection of real-world insurance data widely used in actuarial pricing and risk assessment.

Through hands-on exercises in R, students learned how to compute pure premium, frequency, and severity based on historical claims data. This practical exposure enabled them to apply theoretical knowledge to real-world scenarios, fostering essential skills for their future careers.

The workshop further bridged the gap between theory and practice by introducing Generalised Linear Models (GLMs), a powerful statistical technique widely used in actuarial pricing. GLMs help insurers model claims frequency, severity, and risk assessment with greater accuracy.

Mr Soo demonstrated how GLMs establish relationships between risk factors—such as age, location, and coverage type—and claim amounts. Participants actively engaged in using R programming to implement GLMs, interpret results and gain insights into how pricing strategies are formulated in the insurance industry.

Beyond GLMs, Mr Soo introduced advanced modelling techniques like Gradient Boosting Machines (GBM), which enhance predictive accuracy. He also showcased the decile technique, a performance metric used to assess the effectiveness of predictive models. These advanced tools equipped students with a broader skillset for refining actuarial pricing models.

Interactive Learning and Industry Insights

The workshop concluded with an engaging Q&A session, where students sought clarifications on actuarial pricing methodologies and their industry applications. This interactive format encouraged participants to deepen their understanding and apply their newfound knowledge to real-world pricing challenges.

Reflecting on their learning experience, participants shared their key takeaways:

“I learned so much about pricing concepts and their real-world applications. Mr Soo's explanations were clear and easy to understand, and the hands-on exercises helped solidify my understanding. I especially enjoyed learning about GLMs and their role in actuarial pricing. This workshop has given me a head start in my actuarial career!”— Loo Xue Ying, Year 2, Bachelor of Science (Honours) in Actuarial Studies with a specialism in Data Analytics.

"I was initially hesitant to attend the workshop as I had no prior knowledge about pricing. However, Mr Soo's engaging presentation and the interactive sessions made the learning process enjoyable and informative. I particularly appreciated the opportunity to work with the dataCar dataset in R and apply the concepts we learned. The Q&A session was also very helpful in clarifying my doubts. I would highly recommend this workshop to anyone interested in learning more about actuarial pricing." — Ng Xiang Yee, Year 2, Bachelor of Science (Honours) in Actuarial Studies.

Bridging Academia and Industry

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Mr Soo Cheng Soon (centre) received a token of appreciation from APU ASC President, Peyton Ong (right), and Internal Vice President, Allesya Sofea Binti Abdul Latiff.

The Price It Right!: Strategic Pricing Workshop equipped APU’s actuarial students with valuable technical skills and practical exposure to real-world pricing challenges. By bridging academic knowledge with industry applications, the session empowered participants to navigate the complexities of actuarial science confidently.

With actuarial pricing playing a critical role in the financial and insurance sectors, APU’s commitment to providing industry-relevant education ensures its students are well-prepared for their future careers. Through engaging workshops, hands-on exercises, and expert-led sessions, APU continues to cultivate the next generation of skilled actuaries ready to drive innovation in strategic pricing.

In addition to the Bachelor of Science (Honours) in Actuarial Studies programme, APU also offers the Master of Science in Actuarial Science programme, which provides exemptions from seven professional exams (CS1, CS2, CM1, CM2, CP1, CP2, and CP3) offered by the Institute and Faculty of Actuaries (IFoA), UK.