Course 2007-2008 a.y.

Course Objectives

The purpose of the course is to provide students with a conceptual framework for making risk management decisions that increase business value. The emphasis is on traditional management of pure risk and insurance. However, the foundation for understanding other types of risk management is also established. The evolving concepts of enterprise risk management is introduced and blended into several parts of the course.
All topics are discussed firstly by giving a theoretical introduction and then with a more empirical approach, including exercises and the discussion of cases.

Course Content Summary

The course is organized around four modules.

• The first module is an introduction to risk and its treatment. We then analyze how individuals make choices under uncertainty. Finally, the essential characteristics of all insurance contracts are reviewed.
• The second module focuses on some of the most common and dangerous risks faced by firms, namely: liability risks, and addresses how firms can manage them.
• The third module provides students with a thorough understanding of the main stages of the risk management process (risk identification, measurement and management) and examines a common set of techniques which can be used by managers in dealing with these problems and establishes a decision framework for selecting among these various tools.
• The fourth module deals with the question how risk features in financial decision-making, making the case for a holistic approach to risk management, integrating insurance and treasury risk management into the wider strategic risk management of the firm.

Detailed Description of Assessment Methods

Attending students
Attending students have to pass a written exam which can be split in two partial exams (one mid-term and one final). The exam will cover all the topics taught during the course. 

Non attending students
Written exam. 

Textbooks

• S.E. Harrington, G.R. Niehaus, Risk Management and Insurance, Irwin McGraw-Hill, 2003.
• Additional readings, case studies and lecture notes will be provided in class or will be accessible on the Course Web Page.