Deciding between CB1 and CB2 as your first actuarial exam? This guide compares both subjects, their syllabus, difficulty, and shares tips to help you choose wisely.
CB1 vs. CB2: Which Actuarial Subject Should You Attempt First?
Starting your actuarial journey? Then you are probably staring at two very similar-looking but entirely different subjects—CB1 and CB2—and wondering which one to tackle first. It’s a valid question, and one that almost every actuarial student grapples with at some point.
Both CB1 and CB2 fall under the Core Business modules of the actuarial qualification pathway, and they play a huge role in shaping your understanding of the business side of actuarial science. But here’s the kicker: they test different skill sets. So choosing the right one first can really give you a confidence boost and a smoother path forward.
In this blog, we will take a deep dive into the CB1 vs CB2 actuarial debate—what each subject is about, the kind of questions you will face, their difficulty levels, and how to decide which paper is the better first move for you.
What Exactly Is CB1 All About?
CB1, officially called Business Finance, is primarily focused on the world of finance, accounting, and how businesses manage their money. Think corporate finance, interpreting financial statements, business valuations, investment decisions, and even mergers and acquisitions. If you have had any prior exposure to financial accounting or studied commerce, CB1 might feel like familiar territory.
The CB1 actuarial syllabus includes topics like financial statement analysis, ratio interpretation, cost of capital, working capital management, dividend policies, risk, and corporate governance. The exam leans heavily on your ability to apply financial concepts to practical scenarios. Expect to analyze balance sheets, income statements, and calculate things like Net Present Value (NPV) or Internal Rate of Return (IRR). It’s part theory, part application—and very numbers-driven.
What Does CB2 Cover?
On the flip side, CB2—Business Economics—focuses on how markets and economies work. It takes you through microeconomics (individual consumer and firm behaviour) and macroeconomics (government policy, inflation, unemployment, etc.). It’s more theoretical, and there’s minimal calculation involved compared to CB1.
The CB2 actuarial syllabus includes concepts like demand and supply, market structures (think monopoly, oligopoly, etc.), inflation, interest rates, fiscal and monetary policy, economic indicators, and even international trade. If you have studied economics in school or university, this paper might feel easier and even enjoyable. However, if economic theories and models bore you or you dislike reading long conceptual material, CB2 could feel like a slog.
CB1 vs CB2 Actuarial: What Makes Them Different?
Now, let us talk about what really sets these two apart.
CB1 is much more calculation-based. You will spend time solving finance problems, reading and interpreting financial statements, applying valuation techniques, and working on case-based questions. It’s practical and, for many, very rewarding—especially if you enjoy numbers and logical problem-solving. That said, if you have never touched a balance sheet in your life, be prepared for a bit of a learning curve.
In contrast, CB2 is largely conceptual. While there are graphs, diagrams, and a few basic formulas to work with, the bulk of your time will be spent understanding economic theory, reading about how policies impact markets, and writing long-form answers explaining cause-and-effect relationships. It requires more reading, memory, and clarity in writing rather than number-crunching.
So, when people ask, “Which one is more difficult?”, the answer isn’t so black and white. It genuinely depends on your background and interests.
Which One Should You Attempt First?
Let us break it down further to help you make the best choice for your personal strengths.
If you have a background in accounting, finance, or business studies, starting with CB1 is usually the smoother route. The terminology won’t feel alien, and you will likely find the numerical aspect engaging. CB1 also pairs nicely with future subjects like SP5 or SP6 if you are leaning toward investment or financial specialties later in your actuarial career.
However, if economics was your thing in high school or university, then CB2 might be a more comfortable starting point. It’s generally seen as more reading-heavy but slightly lighter in terms of pure complexity. That’s not to say it’s “easier” — it just taps into a different kind of thinking. If you enjoy writing, understanding macroeconomic trends, or how governments manage economies, you’ll probably find CB2 more enjoyable.
Also, consider how much time you have. CB1 typically takes more time to prepare due to the detailed calculations and spreadsheets involved. CB2, while content-heavy, is sometimes seen as easier to revise if you are good at summarizing and understanding big-picture concepts.
Real Talk: Which Is More Useful?
Both CB1 and CB2 are fundamental to your actuarial journey, and skipping one is not an option—you will have to pass both eventually. That said, CB1 is often considered more practically useful if you plan on going into investment consulting, financial modeling, or pension scheme valuations. It provides a base for understanding how money flows within a company, how investment decisions are made, and how businesses are valued.
On the other hand, CB2 gives you a broader macro understanding of how external forces—like interest rates, inflation, or government policy—can affect markets, businesses, and insurance industries. It’s super relevant if you are interested in public policy, health economics, or even consulting work that involves regulatory frameworks.
Study Tips for Both Subjects
For CB1:
- Practice, practice, practice! The more questions you solve, the better you’ll understand the patterns.
- Make sure to understand financial terms and accounting principles. Don’t just memorize—they will test application.
- Use spreadsheets and calculators efficiently. It’s not just about getting the right answer, but showing clear steps.
- Review past paper solutions and examiner’s reports to understand common mistakes.
For CB2:
- Read economic news—it helps you see real-world applications of what you study.
- Create visual aids like mind maps or diagrams for theory-heavy topics.
- Focus on definitions, but also understand how concepts link together.
- Practice explaining concepts in your own words—this is especially helpful for long-answer questions.
Final Thoughts:
While there’s no one-size-fits-all answer, that’s actually a positive—choosing between CB1 and CB2 allows you to align your exam path with your individual strengths and background.
Consider CB1 if you enjoy working with numbers, have a foundation in finance or accounting, and want to build strong corporate finance skills.
Opt for CB2 if you prefer theory over calculations, have studied economics, or are more interested in understanding how economic forces impact business and insurance.
Ultimately, both papers are essential. Starting with the one that suits your strengths can give you the confidence boost you need at the beginning of your actuarial journey.
Need help deciding which paper to start with or looking for expert guidance on how to ace CB1 or CB2?
Finstat Academy is here to support you every step of the way. With experienced faculty, personalized mentoring, and a proven track record of success, we will help you build a strong foundation and clear your actuarial exams with confidence.
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