By Ambrose Lo, Ph.D., FSA, CERA

In recent years, the Associate of the Society of Actuaries (ASA) curriculum has undergone a remarkable transformation (“modernization”) on a previously unimaginable scale. The flowchart below shows how the various exams in the modern-day ASA pathway are related and should give aspiring actuaries some idea of what lies ahead. While there is no set order in which the exams should be taken, students typically attempt exams from left to right, progressing from introductory, intermediate, to advanced levels.

Predictive Analytics Trio : SRM, PA, and ATPA

The latest curriculum redesign took place in 2022, with the most striking change being the incorporation of the so-called Predictive Analytics Trio, or three exams with a strong emphasis on cutting-edge predictive analytics techniques: SRM (Statistics for Risk Modeling), PA (Predictive Analytics), and ATPA (Advanced Topics in Predictive Analytics).

Together, these three exams form the SOA’s recently introduced Data Science for Actuaries Micro-credential.

At a high level, the PA Trio share the same theme of model building, but test the different stages of the model building process at different levels and in different formats. You will typically start with SRM, which lays the conceptual foundation, progress through PA, where you apply predictive models to a business problem, and conclude with ATPA, which explores more advanced data analytic topics.

Component 1: SRM.

Often the first in the trio taken by students, SRM is a 3.5-hour multiple-choice exam that serves to provide you with the foundational knowledge behind the modeling process and get you up to speed. You will learn the general tools for constructing and evaluating predictive models (e.g., training/test set split, cross-validation), and the technical details of specific types of models and techniques (e.g., generalized linear models, decision trees, principal components analysis, and clustering). The ultimate objective is to ensure that students understand basic predictive analytic concepts before setting foot  in the PA and ATPA arena.

A distinguishing characteristic of SRM compared to other multiple-choice exams is that most SRM exam questions are conceptual in nature, testing the ins and outs, pros and cons, do’s and don’ts of different predictive models, and their similarities and differences. To succeed in this exam, it is important to understand how the models work at a high level as well as pay attention to fine details.

Component 2: PA.

Armed with the basics, you will apply the theory you learned in Exam SRM to a business problem in Exam PA, which is a 3.5-hour written-answer exam consisting of usually 9-10 well-defined and independent tasks, most of which are further broken down into one or more subtasks and require reasonably short answers. You will have access to Microsoft Word (for preparing your answers) and Excel, but not R or RStudio, and the R code and output relevant to the exam tasks will be provided directly in the exam paper. Most subtasks fall into one of the following three categories:

• Type 1: Conceptual questions
  Each exam has quite a number of subtasks that require you to describe or explain the predictive analytic concepts covered in the syllabus. These descriptive subtasks are good ways for the SOA to test your conceptual understanding of predictive analytics. They also mean that there are definitions and descriptions you have to memorize in advance as part of your exam preparation.
• Type 2: Analytical questions
  In the majority of the exam tasks, you will examine some externally generated graphs and output, and provide explanations (e.g., why the model behaves in the way shown), interpretations (e.g., what does the output mean or imply?), or recommendations (e.g., which model is the best, in what sense?). Compared to tasks of type 1 above, which mainly test the ability to recall, these analytical tasks are more demanding because you are required to formulate your answers based on the given information coupled with your prior knowledge of predictive analytics. It is not enough to memorize; you will have to reason and apply.
• Type 3: Simple calculation questions
  There are also some subtasks where you are asked to use the given output to calculate certain model quantities by hand and do some simple analysis.

Because SRM lays the conceptual groundwork for PA and the two exams have a rather big overlap, we recommend preparing for PA at the same time as or shortly after taking (and passing!) SRM, e.g., taking SRM in early September and PA in mid-October, or SRM in early January and PA in mid-April. Nevertheless, the written-answer format of Exam PA allows for broader and deeper testing of your ability to articulate concepts and reason through problem-solving in writing. You will find that translating your thoughts into words is harder than you imagined, so be sure to practice explaining things precisely and concisely.

Component 3: ATPA.

The last member of the PA Trio, ATPA is a 96-hour take-home computer-based assessment that consists of more open-ended tasks than those in PA and tests “advanced” stuff in two directions: (Remember that the first letter A in “ATPA” stands for “Advanced.”)

• Advanced data management and issues
• Advanced predictive models (more advanced than those covered in SRM and PA)

Because ATPA is not a proctored exam, it should, more precisely, be called the ATPA “Assessment,” but don’t dismiss ATPA as a breeze—it demands a high level of proficiency in data manipulation and model building in R, and the preparation it requires is broadly comparable to that of a closed-book exam. During the 96-hour window, you will spend most of your time dealing with various data issues, constructing and evaluating advanced predictive models, and finally turning your results into formal writing. Make sure that you allocate sufficient time in your schedule  for the next 4 days before you start the assessment. You may need more than a day just to clean the data and get it in good shape in R before building any models. You will be busy doing coding  and writing!

Choosing the Best Study Materials for the PA Trio

When selecting study materials, it’s essential to look for resources that are exam-focused and learning-oriented. Here are some key aspects to consider:

• Author’s Experience and Perspective – Look for study materials crafted by authors who have personally taken the exams and passed with flying colors. Teaching for an exam and taking an exam are vastly different activities, and the first-hand insights and “real battle experience” of authors who have braved the exams mean the study materials are far more relatable to what you’ll encounter on the exam day.
• Exam-Focused Content – Quality study guides should integrate detailed explanations with illustrative examples and past SOA exam questions, all designed to help you grasp the material effectively. A clear layout with easily identifiable formulas and concepts also helps streamline your study sessions.
• Consistency Across Exams – Choosing materials from the same author for multiple exams, such as the PA Trio, can provide a cohesive learning journey, with a consistent narrative style and structure that makes each new topic easier to tackle.
• Additional Learning Support – Supplementary resources designed to suit the needs and preferences of different students can add substantial value to learning. Video explanations, for example, can be invaluable for reinforcing understanding and retention via visual and auditory means.
• Mock Exams and Feedback – For written-answer exams like PA, consider materials that offer graded mock exams. You will work on the mock exam under simulated exam conditions and receive personalized feedback, which can be incredibly helpful in pinpointing areas for improvement and ensuring that you’re fully prepared.

When it comes to finding study materials that truly support your journey, the ACTEX products for the PA Trio check all the boxes. Written by an instructor who has taken these exams and experienced the “pain” of SRM, PA, and ATPA students, these resources focus directly on exam content, offer clear explanations and illustrative examples, and ensure a consistent and cohesive approach across multiple exams. By choosing these tried and true materials, you’re setting yourself up for a more effective and efficient study experience, and maximizing your chance of success.

To explore all the resources that can help you succeed, please click here for more detailed information: SRM, PA, and ATPA.