SOA Exam SRM Study Guide (2026)

SOA Exam SRM (Statistics for Risk Modeling) is a 3.5-hour, 35-question multiple-choice exam testing the statistical and predictive modeling techniques actuaries use in risk analysis (SOA). The pass rate runs about 50 to 55% (SOA). Exam SRM sits in the SOA's preliminary exam sequence, usually after Exams P, FM, and FAM.

SRM is the point where the actuarial sequence pivots from pure mathematics to applied data science. The content overlaps heavily with what data scientists and quantitative analysts learn, just framed through an actuarial lens. If you liked the statistics and modeling courses in your degree, SRM will feel natural.

What the Exam Covers

The SOA syllabus splits SRM into five topic areas (SOA):

1. Linear Models (20 to 25%)

Simple and multiple linear regression, assumptions and diagnostics, residual analysis, multicollinearity, interpretation of coefficients, R-squared and adjusted R-squared.

Linear regression is the foundation. Every other modeling technique on the exam builds on it or extends it.

2. Generalized Linear Models (30 to 35%)

GLMs are the heart of the exam. Topics include:

  • Link functions (log, logit, identity)
  • Distributions in the exponential family (Poisson, binomial, gamma, normal)
  • Logistic regression for binary outcomes
  • Poisson regression for count data
  • Deviance, AIC, BIC for model comparison
  • Variable selection (forward, backward, stepwise)
  • Overdispersion and how to address it
Key Concept

GLMs are the single most important topic on Exam SRM. They account for roughly a third of the exam and form the basis for how actuaries actually model insurance data. Put at least 40% of your study time here.

3. Time Series (15 to 20%)

Autoregressive (AR), moving average (MA), and ARIMA models. Stationarity, differencing, autocorrelation and partial autocorrelation functions (ACF/PACF), model identification, and forecasting.

4. Principal Components Analysis (10 to 15%)

Dimensionality reduction, eigenvalues, proportion of variance explained, and when PCA is appropriate. The exam tests conceptual understanding and interpretation of PCA output.

5. Decision Trees and Cluster Analysis (10 to 15%)

Classification and regression trees (CART), pruning, random forests, bagging. K-means clustering, hierarchical clustering, and how to evaluate cluster quality.

Common Trap

Candidates who studied machine learning in school sometimes blow through GLMs, figuring logistic regression is "easy." The exam tests GLMs at a depth that goes past most intro ML courses. You need deviance residuals, link function selection, and overdispersion diagnostics, not just the ability to fit a model.

The ISLR Advantage

The primary reference text for Exam SRM is An Introduction to Statistical Learning (ISLR) by James, Witten, Hastie, and Tibshirani. The book is freely available from the authors' website. That is a real edge over other actuarial exams, where the reference texts run $100+.

ISLR is well-written and accessible. Read it carefully, work the conceptual exercises, and you will have solid coverage of most Exam SRM topics. The one gap: ISLR does not cover GLMs to the depth the SOA wants, so plan on supplementary material there.

Study Timeline (13 Weeks)

The SOA recommends roughly 250 to 300 hours for SRM. A 13-week plan at 20 to 23 hours per week:

Weeks 1 to 3: Linear Regression

Build a thorough foundation. Do not rush it. Every GLM concept extends from linear regression. Practice reading regression output, checking assumptions, and knowing what each diagnostic is telling you.

Weeks 4 to 7: GLMs (The Core)

Spend the most time here. Work through Poisson regression, logistic regression, and gamma regression examples. Practice calculating deviance, comparing models with AIC/BIC, and spotting overdispersion. This is where the exam separates passing candidates from failing ones.

Weeks 8 to 10: Time Series, PCA, Trees, and Clustering

These topics weigh less individually but show up on every exam. Time series is the most calculation-heavy of the four. PCA and clustering lean conceptual.

Weeks 11 to 13: Practice Exam Phase

Full-length practice exams (35 questions, 3.5 hours). You get 6 minutes per question on average, which is generous next to Exams P and FM. Use the cushion to read questions carefully and double-check your reasoning.

Key Concept

Exam SRM gives you 6 minutes per question (versus 6 minutes for a 30-question, 3-hour exam). The extra half-minute per question reflects how interpretive the material is. Use it. Read the output tables closely before you answer.

Practice Strategy

Plan for 700 to 1,000 practice questions before exam day.

Exam SRM questions tend to hand you model output (regression tables, deviance statistics, ACF plots) and ask you to interpret it or pick the best model. That is a different game from Exams P and FM, where you crank calculations from scratch.

FreeFellow offers free Exam SRM practice questions with adaptive difficulty and detailed solutions covering all five topic areas.

Practice benchmarks:

  • After 300 questions: scoring 45 to 55% on mixed practice
  • After 600 questions: scoring 55 to 65% on practice exams
  • Exam ready: scoring 65%+ consistently on full-length mocks

Common Mistakes

Rushing through GLMs. Underinvesting in GLMs and overinvesting in topics like PCA or clustering is a bad trade. GLMs are 30 to 35% of the exam.

Memorizing formulas without understanding them. SRM tests interpretation, not computation. Knowing the formula for AIC matters less than knowing when AIC points to a different model than BIC.

Ignoring model diagnostics. The exam keeps asking "what is wrong with this model?" or "which diagnostic flags a problem?" Practice reading residual plots and goodness-of-fit statistics.

Common Trap

Some candidates study SRM like Exam P, drilling calculations. SRM is fundamentally an interpretation exam. You need to know what the numbers mean, not just how to compute them.

Free Resources

  • FreeFellow Exam SRM Practice - free practice questions with adaptive difficulty, solutions, and analytics
  • ISLR (free textbook) - the primary reference, freely available from the authors
  • SOA sample questions - official SRM practice questions with solutions
  • SOA study note on GLMs - supplementary material covering GLMs beyond what ISLR provides

Start your Exam SRM preparation with free practice questions on FreeFellow.