Actuarial Regulation on Two Continents: The FRC–IFoA Settlement and the US Alternative

In December 2025, after seven years of expectation, the UK confirmed that it would not proceed with statutory regulation of the actuarial profession. The Financial Reporting Council and the Institute and Faculty of Actuaries will instead continue under voluntary arrangements set out in a memorandum of understanding.

This was a significant decision, and it passed with remarkably little commentary outside the profession. It settles — for now — a question that had been open since the Kingman Review in 2018, and it leaves the UK and the US with regulatory architectures that are far more similar than most practitioners assume, having arrived there by completely different routes.

*This article discusses professional and regulatory frameworks in general terms and is not legal advice.*

What the UK Nearly Did

The proposals that did not proceed would have been a substantial change. They contemplated the FRC becoming a statutory body with powers to oversee and regulate the actuarial profession, with that responsibility focused primarily on individuals undertaking public interest actuarial work, and with additional statutory powers to set technical actuarial standards for IFoA members covering their actuarial work — including non-public-interest work for individuals or entities.

The lineage is worth understanding, because it explains why actuaries were in scope at all. The planned legislation stemmed from government reviews prompted by concerns over UK audit quality following high-profile corporate collapses including Carillion and BHS. The Kingman Review examined the FRC's role. Actuarial regulation was swept into an audit reform agenda, and the proposals were expected to be introduced through draft audit reform and corporate governance legislation.

The IFoA engaged through a Council-designated Regulatory Strategy Steering Group, raising concerns about unintended consequences — including proposals around opt-out arrangements that could have created perverse incentives.

The outcome: statutory intervention set aside, voluntary arrangements retained. The IFoA characterised this as a positive result recognising that statutory intervention could have produced unintended consequences for members and their employers.

What the UK Actually Has

The retained architecture is a hybrid, and it is easy to underestimate its force.

The FRC sets Technical Actuarial Standards. TAS 100 contains requirements applying to all technical actuarial work, supported by technical actuarial guidance covering models, proportionality, the meaning of technical actuarial work and geographic scope. TAS 200 covers insurance work; TAS 300 covers pensions other than collective money purchase schemes.

The IFoA enforces them through professional obligation. Under the memorandum of understanding, the IFoA requires those members to whom the TASs are intended to apply to observe them. The FRC does not directly discipline most actuaries — the IFoA does, under its own disciplinary scheme.

The FRC handles public interest cases directly. Independent investigation and disciplinary hearings in public interest actuarial cases run through the FRC Actuarial Scheme.

The FRC monitors quality independently. Its Actuarial Monitoring Programme reviews the quality of technical actuarial work and practitioners' compliance with standards, referencing indicators in its Actuarial Quality Framework. It also supervises the IFoA's discharge of its regulatory functions, including governance and public interest aspects of examination and admissions.

The Actuaries' Code governs conduct. Integrity, competence and care, impartiality, compliance, speaking up and communication — applying at all times, not only during technical work.

The Quality Assurance Scheme provides voluntary accreditation at organisational level, and practising certificates are required for certain reserved roles.

That is a great deal of structure for a "voluntary" arrangement. The practical enforceability comes from the fact that membership of the IFoA is a commercial necessity for most actuarial roles, and the IFoA can remove it.

What the US Has Instead

The US never contemplated a statutory actuarial regulator, and its architecture reflects that.

Standards are set by the Actuarial Standards Board, which promulgates Actuarial Standards of Practice covering specific areas of work. ASOPs are binding on US actuaries through the Code of Professional Conduct rather than through statute.

Qualification is governed by the US Qualification Standards, administered through the American Academy of Actuaries, which determine who may issue statements of actuarial opinion and impose continuing education requirements.

Discipline runs through the Actuarial Board for Counseling and Discipline, which considers alleged violations and makes recommendations to the actuary's membership organisation — the SOA, CAS, Academy, Conference of Consulting Actuaries or the pension actuaries' body — which takes the disciplinary action.

Credentialing sits with the SOA and CAS, which run the examination and fellowship pathways.

Regulatory force arrives through state insurance law, principally via the Appointed Actuary requirement and the Statement of Actuarial Opinion on reserves, filed with the domiciliary state regulator. This is where a US actuary's professional work meets legal consequence most directly.

The Comparison That Matters

The headline similarity — neither country statutorily regulates actuaries — conceals the most important difference, which is who sets the standards.

In the UK, standard-setting sits with an independent regulator that is not the profession. In the US, it sits with a board affiliated with the profession itself. Whatever one thinks of the merits, this is a genuine structural distinction, and it explains why UK technical actuarial standards have a broader, more principles-driven reach across all technical actuarial work while ASOPs are more granular and area-specific.

The second real difference is independent quality monitoring. The FRC's Actuarial Monitoring Programme, which selects topics and reviews actual work product against standards, has no direct US national counterpart. US quality assurance operates through state examination of filed opinions and through peer review requirements in specific contexts.

What This Means in Practice

For actuaries working across both jurisdictions: you are subject to both standard sets, and they are not identical. The UK's broader scope means work that would attract no specific ASOP may nonetheless fall under TAS 100. The safe operating assumption for cross-border work is to meet the more demanding requirement and document why.

For firms employing actuaries: the professional obligation runs to the individual, not the firm, and it is not displaced by firm policy or management instruction. This is worth stating explicitly in internal policy, because it prevents an avoidable category of conflict from arising in the first place.

For anyone relying on actuarial work in the UK: the December 2025 outcome means the reliability of that work continues to rest on professional obligation backed by FRC standard-setting and monitoring, rather than on direct statutory supervision of individuals. The arrangement is credible, and it is also contingent — it depends on the profession continuing to discharge it in a way that survives public and parliamentary scrutiny.

For the profession itself: this is a period of demonstration rather than relief. A voluntary settlement retained after a serious statutory proposal is durable only for as long as it is seen to work. The natural test cases will be climate, AI and pensions — the areas where actuarial judgement affects the most people who have never heard of an actuary.

One Convergence Worth Watching

Both jurisdictions are pushing the same question toward the profession from different angles: what does actuarial standard-setting look like for AI-assisted work?

The IFoA has established an AI, Data Science and Emerging Technologies Practice Board and runs a Certificate in Ethical AI, with working parties on responsible AI and explainability. On the US side, AI governance expectations are arriving through the NAIC's Model Bulletin and its state adoptions rather than through actuarial standards directly.

Neither jurisdiction has yet answered the practical question: when an actuary signs an opinion informed by a machine learning model they did not build and cannot fully specify, what does the professional standard require them to have done? That question is going to be answered — by guidance, or by the first case in which it goes wrong. The profession has a strong interest in it being the former.

Key Takeaways

• In December 2025 the UK confirmed it would not proceed with statutory actuarial regulation; the FRC and IFoA continue under a memorandum of understanding.

• The proposals originated in audit reform following Carillion and BHS, via the Kingman Review, rather than from any actuarial failure.

• The UK retains FRC-set Technical Actuarial Standards, IFoA enforcement, FRC public interest discipline and independent quality monitoring.

• The US relies on profession-affiliated standard-setting through the ASB, qualification standards via the American Academy, ABCD discipline, and state insurance law through the Appointed Actuary role.

• The key structural difference is not statutory versus voluntary — neither is statutory — but whether standards are set by an independent regulator or by the profession.

Frequently Asked Questions

Is the UK actuarial profession statutorily regulated? No. In December 2025 the UK confirmed that statutory regulation of actuaries would not proceed. The Financial Reporting Council and the Institute and Faculty of Actuaries continue under voluntary arrangements set out in a memorandum of understanding, under which the FRC sets Technical Actuarial Standards and the IFoA requires relevant members to observe them.

What is the difference between TAS and ASOPs? Technical Actuarial Standards are set by the FRC, an independent UK regulator, with TAS 100 applying to all technical actuarial work and sector standards covering insurance and pensions. Actuarial Standards of Practice are set by the US Actuarial Standards Board, a profession-affiliated body, and are generally more granular and area-specific. Both bind through professional obligation rather than statute.

Who disciplines actuaries in the UK and the US? In the UK, the IFoA operates the disciplinary scheme for its members, while the FRC conducts independent investigation and hearings in public interest cases through the FRC Actuarial Scheme. In the US, the Actuarial Board for Counseling and Discipline considers alleged violations and recommends action to the actuary's membership organisation, which imposes any discipline.

Related reading

• Two systems, one problem: how the UK and US regulate model risk in 2026

• The compliance stack: law, regulation, professional standard and firm policy

• Chain-ladder vs Bornhuetter-Ferguson: choosing a reserving method

See also Regulatory Compliance and Insurance Risk, or review qualifications.

About the author

Jonas Osman Abdelghafour is an actuary and risk expert advising insurers, banks and pension funds on model risk, regulatory compliance, financial crime and enterprise risk management across UK, EU and US regimes. He writes on where quantitative actuarial practice meets the governance, risk and compliance frameworks regulators expect boards to evidence. See qualifications and services, or get in touch to discuss an engagement.