The pursuit of the neo-liberal economic model over half a century has led to a privatisation of risk. In turn, the (re)insurance industry has become omnipresent in all aspects of society as a facilitator of risk. Through the design of novel risk transfer and diversification solutions, the (re)insurance industry has enabled modern economies to become resilient and promote economic growth and prosperity. However, globally, the resilience of economies is under threat due to increased climate risks. Natural and man-made hazards and perils are becoming increasingly prevalent and concentrated, creating vulnerable populations and organisations, while 'secondary' perils are hindering the progress of economic recovery. The consequences of these risks are amplified in developing and emerging nation states due to their heavy reliance on environmental resources for economic progress. This module will explore the role that insurance mechanisms play in enabling positive ex-post and ex-ante sustainable economic, environmental, and societal progress. This module examines new techniques in mapping, modelling and finding liability and property risks. The module includes risk transfer solutions for catastrophic events, and examines recent advances in modelling, risk prevention, and claims technology, while also exploring risk management approaches to energy and food security that arise from climate-related risks.

This module will look at modelling and simulation techniques used in the management and pricing of natural catastrophe and man-made risks such as human conflict, drought, desertification, flooding, landslides, windstorms, hurricanes, earthquakes and wildfire. These developments in modelling dynamic systems are leading to greater innovation in the insurance market with increasing interest in insurance-linked securitisation and micro-insurance products in both developed and emerging economies. The module structure is designed to begin with an introductory phase that defines insurable risk, explores risk transfer channels and the importance of controlling volatile loss costs, while examining the limitations of data required in underwriting risks that are undergoing structural changes. The second part of this module will include the mathematics of modelling catastrophe events, including conventional risk calculation measures and extreme value theory. Learners will understand and apply computer modelling techniques to stress-test insurance portfolios, and investigate risk exposures and insured loss calculations in dynamic scenario analysis settings. Learners will also become accustomed to risk transfer mechanisms such as reinsurance contracts, blended products and insurance securitisations, while appreciating the role of the stakeholder network in building more resilient communities.

On successful completion of this module, students will be able to: • Identify, describe and classify climate-related financial and non-financial risks • Demonstrate an understanding of the mathematical principles underlying risk exposures and insured loss calculations in an extreme event context. • Explain the application of underwriting and simulation data to price natural and man-made perils exposed to climate risk. • Apply appropriate modelling techniques to measure the impact of catastrophic events on insurance portfolios and corporate and economic resilience. • Critically evaluate the suitability of different hedging and risk transfer mechanisms to disperse and manage the financial impact of climate-related risk events

On successful completion of this module, students will be able to: • Demonstrate an appreciation of the complex innovations that the insurance system must derive to fund liabilities arising from catastrophic risk events.

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The module will be delivered face to face and will incorporate lectures, specialist guest speakers, and tutorials. Agile learners will be developed with the ability to make courageous and informed decisions by equipping students with the technical skills and knowledge required to interrogate and model real-time data to yield useful insights. The module will engage students in discussions on modelling techniques and their applications in making astute decisions under uncertainty, and to appreciate the impact of climate-related risks on economic and business resilience.