From the probability of Pascal and Fermat to twentieth century risk theory and the data era: the story of the science that learned to calculate the future, and of its arrival in Mexico.
Actuarial science was born where two seventeenth century ideas met: that chance can be measured with probability, and that human mortality follows statistical patterns.
The correspondence between Blaise Pascal and Pierre de Fermat on the "problem of points" gives rise to the calculus of probabilities: the mathematical language of chance on which all of risk theory would be built.
In Natural and Political Observations upon the Bills of Mortality, John Graunt analyzes London’s death records and sketches the first life table: demography and vital statistics are born as a science.
The Dutch statesman Johan de Witt, with contributions from Christiaan Huygens, calculates mathematically the value of the life annuities issued by the Dutch state: the first serious financial use of survival probability.
The astronomer Edmond Halley publishes one of the first mortality tables based on real data and uses it to value annuities by age, combining financial discounting with the probability of survival. It is the technical foundation of actuarial science.
Theory becomes business: the scientific premium appears, along with the first insurer built on a mathematical basis and the very title of "actuary".
James Dodson conceives the level premium graded by age, charging more in the early years to build up a reserve, which solved the problem of insuring older people. His ideas would make modern life insurance possible.
The Society for Equitable Assurances is founded in London, the first insurer based on actuarial calculation. Edward Rowe Mores, key to its creation, is the first to use the professional title of "actuary" in its modern sense.
Richard Price publishes the influential Northampton table (1783) and advises the Equitable; his nephew William Morgan, the company’s actuary, puts the calculation of premiums and reserves and the periodic valuation of the financial position into practice.
Actuarial science becomes a formal discipline: mathematical laws of mortality, the first professional bodies and expansion to the Americas.
Benjamin Gompertz shows that adult mortality grows exponentially with age, giving life tables a mathematical basis still used today.
The Institute of Actuaries is founded in London (1848), the first formal professional body, followed by the Faculty of Actuaries in Edinburgh (1856). Actuarial science adopts common technical and ethical standards.
William Makeham adds a term for external causes, creating the Gompertz-Makeham law, one of the best descriptions of human mortality.
The Actuarial Society of America is founded (1889); in the United States, Elizur Wright secures mandatory reserves and surrender values. In 1895 the forerunner of the International Actuarial Association (IAA) is born.
Actuarial science becomes a rigorous branch of applied mathematics: ruin theory, immunization, credibility and the economics of insurance.
The Swedish actuary Filip Lundberg creates collective risk theory and poses the problem of the insurer’s ruin, later formalized by Harald Cramér in the Cramér-Lundberg model.
The Casualty Actuarial Society (CAS) is founded in the United States, devoted to property and casualty insurance (auto, property, liability), a field distinct from life insurance.
The merger of the Actuarial Society of America and the American Institute of Actuaries creates the Society of Actuaries (SOA), today the largest actuarial organization in the world in life, health, pensions and finance.
Frank Redington formulates the theory of immunization: structuring assets so that the business is protected from changes in interest rates. A central idea of asset-liability management.
Bruno de Finetti develops subjective probability; Hans Bühlmann creates modern credibility theory; and Karl Borch founds the economics of insurance and of optimal reinsurance. The actuarial toolbox is complete.
Mexico was a pioneer in Latin America: the first actuarial degree program in the region was born here.
With precedents such as the Nacional Monte de Piedad (1775), the first insurance companies are established over the nineteenth century, importing European methods for pricing life policies and creating the first demand for actuarial work.
The Ley General de Instituciones de Seguros (General Insurance Institutions Law) reserves the business to Mexican companies and requires technical reserves and actuarial opinions, making the actuary an indispensable figure in the financial system.
The IMA is founded and grants the title of actuary to its 14 founding members: the first professional organization in the country.
On February 13, 1947, UNAM approves the first curriculum for the Licenciatura en Actuaría (bachelor’s degree in actuarial science) at its Facultad de Ciencias, with founding figures such as Emilio Velarde y Dondé. It is the first actuarial degree program in all of Latin America.
Emilio A. Hazas Sánchez sits for the first professional actuarial examination in Mexico and develops for the IMSS (Mexican Social Security Institute) the first biometric tables based on Mexican experience.
The AMA is established, the oldest professional association within the Mexican insurance sector.
The Colegio de Actuarios de México (1966) adopts its current name in 1982: Colegio Nacional de Actuarios (CONAC), which brings together the country’s actuaries and represents them before the IAA.
The reform of the Sistema de Ahorro para el Retiro (retirement savings system) and the creation of the AFOREs (retirement fund managers) drive up demand for actuaries in pensions, investments and liability valuation, expanding the profession beyond traditional insurance.
Mexico hosts the 27th International Congress of Actuaries in Cancún (2002) and, according to the profession’s historical record, the Mexican actuary Luis Huerta goes on to chair the International Actuarial Association, a sign of the maturity of Mexican actuarial science.
The profession is going through its greatest expansion: from traditional insurance to the frontier of data and global risks.
Actuaries bring data science, predictive models and artificial intelligence into pricing, reserving and fraud detection, with tools such as Python, R and SQL.
Frameworks such as Solvency II and, in Mexico, the Ley de Instituciones de Seguros y de Fianzas (LISF, Insurance and Surety Institutions Law) place the actuary at the center of enterprise risk management (ERM) and regulatory capital.
Climate change, cyber risk and population aging open entire fields for a profession consistently ranked among those with the strongest outlook of the century.
The account of Mexico draws on the book Historia de la Actuaría en México. De sus orígenes hasta el 2021 (History of Actuarial Science in Mexico, from its origins to 2021; CONAC) and on the profession’s literature (AMA, CONAC). The international history is based on reference sources such as MacTutor (History of Mathematics), the IAA, the SOA and the CAS. Some specific facts about Mexico are presented as recorded by the associations’ historical records.