Learning objectives
Knowledge and understanding:
The student learns the basic technical principles of the management of an insurance business; examines the main structure of life and non-life insurance products, of life insurance savings benefits and annuities; investigates the risk management process for an insurer, understanding the main risk management actions.
Applying knowledge and understanding:
The student learns the basic actuarial tools for the pricing of the main insurance benefits, the reserving of insurance products, the assessment of profits and the basic steps of the insurance risk management.
The expertise gained by the student on the topics dealt with in the course are
suitable for several positions in an insurance company or a pension fund. Outside the insurance area, the knowledge provided by the course can help in understanding the features of the risk management services provided by an insurance company to an industry or an individual.
Making judgements:
The course stimulates the ability to perform a critical analysis, as it is expected from a post-graduate student holding an economic background, who is employed in the financial/insurance
sector. The student is able to interpret critically the output of actuarial
valuations, and he/she is also able to use autonomously simple actuarial models.
Communication skills:
The student is educated in the use of the basic actuarial-technical language.
Therefore, he/she is able to communicate efficiently with whom is in charge of actuarial valuations. He/she can coordinate the more strictly technical staff with those charged with managerial duties.
Learning skills:
The student develops the ability to interpret the technical aspects of insurance and pension problems. He/she can understand the quantitative models more suitable for solving such problems. In particular, the student learns how to use non sophisticated
quantitative models and is able to go deeper into the subject in order to understand more advanced quantitative models.
Prerequisites
Basic knowledge of financial mathematics and probability.
Course unit content
Part 1 - Risks: representation, transfer. The features of a pool of risks. Technical aspects of the risk management of an insurer.
Part 2 - Technical aspects of life insurance products: premiums, reserve, linked benefits.
Part 3 – Technical aspects of non-life insurance products: premium, reserves.
Full programme
Available online, on the Elly platform.
During the teaching period, the detailed program will be updated weekly.
Bibliography
A. Olivieri, E. Pitacco. Introduction to insurance mathematics. Technical and financial features of risk transfers. Springer. 2nd Edition, 2015.
Course slides, available (since the beginning of lectures) online on the Elly platform and in printed version at the Copy Centre of the Department of Economics and Management.
Exercises, available only on Elly.
Teaching methods
Face-to-face lectures and extension work.
Face-to-face lectures will be recorded; the url will be provided on Elly. In order to stimulate active participation in class, for some lectures a pre-recording will be provided, to be listened before the face-to-face lecture. For detailed information, see Elly. If, because of technical issues, the recording of live lectures fails, a summary video will be provided.
The student has to further practice on models and numerical problems on his/her own. The student will be assigned problems which he/she has to solve autonomously after classes, so to develop his/her own ability to use the models presented during classes.
Extension work is optional, limited to the teaching period and to be prepared outside class hours. It can be performed individually or in group (up to 4 people admitted in the group), upon student’s choice. Two alternative types of extension work are available: reading and discussing a research or a popular science paper on a topic of current interest to the insurance industry; analysis and comparison of a sample of insurance products traded on the market.
Lecture videos will be available until the end of the winter exam session. Students not attending on site classes are warmly recommended to attend recorded classes sticking to the face-to-face lecture plan.
Assessment methods and criteria
Written exam, possibly followed by an oral exam (optional), and partially replaced by extension work (optional, but limited to the teaching period).
The written exam is arranged as a test consisting of 10 multiple choice questions and 5 open questions. The first four multiple choice questions are on Part 1, the next three on Part 2 and the final three on Part 3 of the course. Open questions are two on Part 1, two on Part 2 and one on Part 3 of the course; more precisely, for two multiple choice questions relating to Part 1, two multiple choice questions relating to Part 2 and one multiple choice question relating to Part 3 the student will be required to justify his/her answer (performing numerical calculations or discussing model issues, depending on the query). Grades: for multiple choice questions, 2.5 points if the answer is correct, -0.5 points if the answer is wrong, 0 points in case of no answer; for open questions, between -1 and 2 points, depending on the correctness and quality of the answer, in terms of model used, calculation and technical language. Time allowed: 40 minutes.
The test is open book. A pocket calculator is admitted, as well as the teaching material used by the student for training. Interaction with other people is not admitted, in no form.
The maximum mark assigned to the test is 27. However, if only multiple choice questions are answered or the answers to open questions are off topic, then the maximum mark is 20.
The oral exam (optional) consists in one/two theoretical questions (about modelling issues). The oral exam lasts approximately 10-15 minutes. Depending on the student’s performance, the mark obtained in the test is adjusted +/- 3 points.
The extension work is available only during the teaching period and replaces the three open questions of Part 2 and 3. It can be performed (upon student’s choice) individually or in group (up to 4 people admitted in the group) and is assessed, for each student, from 0 to 6 points, based on accuracy of the exposition, understanding of the topic and presentation ability. Those performing extension work must complete the exam (test + possible oral exam + extension work presentation) in the winter session; otherwise, the assessment obtained for the extension work will be lost. When taking the test, they will have to answer all the questions relating to Part 1, only multiple choice questions of Part 2 and 3. The maximum grade is 24 and time allowed 25 minutes.
The questions in the written exam and in the oral exam will be designed so to assess knowledge and understanding of the topics covered in the course, as well as applying knowledge and understanding, making judgements and communication skills. The oral exam and the extension work, in particular, will allow to assess understanding, the ability of making judgements and communicating with the appropriate technical language. In the interpretation of the numerical findings and, in case of oral examination, in the oral discussion the student must show his/her communication skills, in particular with regard to the appropriate technical language.
There is not a pre-defined rule for honors. Honors will be awarded to those particularly deserving students who, in addition to having complied with the requisites necessary to obtain full marks, in the performance of the whole exam have proved an appreciable systematic knowledge of the subject, an excellent ability to apply the gained knowledge to the specific problem submitted during the exam, a considerable autonomy of judgment, as well as a particular care in the formal written and oral presentation and excellent communication skills.
During the teaching period, it is possible to take the written exam by attending partial assessments. Details are provided on Elly.
Other information
