To meet the specialist skills requirements of the re/insurance industry by equipping students with a thorough grounding in reinsurance contracts, innovations in product design and the process and structure of insurance linked securitisation (ILS).

The secondary risk transfer device of reinsurance is an essential functional discipline in an insurance organisation. The discipline involves the design and implementation of a reinsurance structure that meets pre-determined criteria of cost economy and effectiveness consistent with solvency assurance. Alternative risk transfer is an evolving set of methodologies that essentially incorporate capital market instruments as an alternative to orthodox corporate insurance programs. (a) Principles and functions of reinsurance/alternative risk transfer. Technical analysis of major product types - quota share: surplus; spread loss; loss stabilisation; operational features of managing the reinsurance/alternative risk transfer function - reinsurance accounting; accumulation control. (b) Statistical analysis of pure risk exposures, including computer based simulations of possible loss scenarios; selection of relevant risk transfer measures; underwriting techniques; exercises in reinsurance/alternative risk transfer programming.

On successful completion of this module students should be able to: Articulate the role and provision of both traditional reinsurance and new reinsurance products. Collaborate with team members on identifying the factors for operational and strategic level decision-making within a reinsurance organization. Demonstrate knowledge of the principles underlying the allocation of loss and premium on all traditional reinsurance contracts. The emerging role of alternative risk transfer will be examined with a particular focus on a number of ART strategies. Evaluate the financial and regulatory implications of finite reinsurance contracts. Explain the structure of insurance linked securities.

Appreciation of position of various stakeholders.

N/A

The students will be taught in a series of lectures and tutorial sessions. The lectures will cover the fundamental aspects of the reinsurance industry and contract types. Tutorial times will provide students with the opportunity to creatively examine the development of mechanisms for alternative risk transfer, demonstrate knowledge on the allocation of losses and premiums on existing contract types and collaborate with colleagues on case study work in reinsurance and alternative risk transfer scenarios.