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Objectives
The course provides advanced knowledge about
- Contribution of technical risks in the industrial plants in/for the business continuity
- Insurance aspects
- Company operation and asset management
Target Attendees / Participants
- BSc/MSc engineering working in industry, academia, banks, insurance companies
- government and other stakeholders dealing with risks in industry
Course Content by Units
Unit 1: Introduction, fundamentals of corporate finance
- Introduction to the course #13
- Introduction in corporate finance
- The value of money: time and risk
- Net present value rules
- Alternative decision rules (IRR, BE, FV)
- Quantifying risk and expected return
- Excursus: Sensitivity analysis
Unit 2: Intro - quantitative risk management
- Scenarios and the derivation of statistical measure
- Risk-return optimization
- Value at risk
- Excursus: Basel II
Unit 3: Modeling and estimating of risk: Insurance vs. financial hedging
- Insurable and non-insurable events
- Premise and the law of large numbers
- Motivation: Computation of premise for life insurance
- Liability and commercial property insurance
- Reinsurance
- Excursus: Underwriting and insurance contracts
- Excursus: Solvency II
- Case studies in Serbia
- External example (will be brought in directly by industry): Insurance of industrial objects in Serbia -examples
Unit 4: Financial hedging of commodity and currency risk
- Toward an Integrated risk modal
- Binomial models and black-scholes approach the value options in an arbitrage-free-world
- Excursus: Markowitz optimization with integer constrains
- Excursus: Real options
Unit 5: Additional issues
- Analysis of Munich Re's: Environmental Report – Perspectives – "Today's ideas for tomorrow's world"
- ISO-25999-2
Unit 6: Review of main course issues and preparation for the final exam
Unit 7: Final exam
Teaching Methods
The course includes:
- introductory note explaining aim and structure of the course, and used methodology as well
- ex cathedra lecturing following the defined units
- number of computational examples for each unit
- one case study from an insurance company
- one individual and several collective exercises
Literature
- Textbook:
Business continuity risks & Insurance
Version 2, June 2010
- Transparencies:
Unit 1: Introduction, fundamentals of corporate finance
Unit 2: Intro - quantitative risk management
Unit 3: Modeling and estimating of risk: Insurance vs. financial hedging
Unit 4: Financial hedging of commodity and currency risk
Unit 5: Additional issue -
- Certification material, version 2, March 2010
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