Insurance Management

Actuarial Topics and ALM in Insurance

Integrated course, 3.00 ECTS


Course content

In this course the scope of activities of actuaries is examined. This is done by discussing actuarial topics which are related to the pricing of and reserving for insurance products, or risk and capital management. A particular focus is set on current topics and trends. A discussion of the challenges and opportunities in an insurance company's asset and liability management is also given.

The core contents of this course include:
[1] Overview of the role and scope of activity of actuaries (pricing, reserving, marketing);
[2] Actuarial techniques in product development (incl. profit testing);
[3] Modern reserving methods (e.g. chain ladder method);
[4] Valuation of options and warranties embedded in insurance contracts;
[5] Technical cash flows as basis for insurer ALM;
[6] Selection of the investment portfolio; regulatory requirements;
[7] ALM concepts for insurance companies (e.g. sources of volatility, life vs. non-life, sensitivities, hedging).
Optional contents can include:
[8] Other modern actuarial topics (e.g. EEV/MCEV).

Learning outcomes

Successful participants in this module have a thorough understanding of the integrated and indicator-based management of insurance companies. In particular, they are conscious of the requirements and challenges in the areas of risk and capital management and can incorporate these aspects into their decision making skills at the enterprise level. This supports a holistic understanding of value creation in the insurance business. In the following modules this knowledge will be applied when discussing insurance products and sales strategies. Additionally, current regulatory frameworks will be discussed in detail.

Post completion of this module, students will have a holistic understanding of the insurance sector, practical aspects of the management of insurance companies and the evaluation of single business areas. During a project students will be able to strengthen their social, team and presentation skills.

Recommended or required reading and other learning resources / tools

References: Briys/de Varenne (2001): Insurance: From Underwriting to Derivatives, Wiley. Hallmann et al (2008): Steuerung von Versicherungsunternehmen, Schäffer-Poeschel. Nguyen/Romeike (2013): Versicherungswirtschaftslehre, Springer. Noack et al (2010): 100 Versicherungskennzahlen, cometis. Romeike (2003): Balanced Scorecard in Versicherungen, Gabler. Romeike et al (2008): Risikomanagement im Versicherungsunternehmen, Wiley.
Academic journals: -

Mode of delivery


Prerequisites and co-requisites

Modules IFG, FIR, VBU, AUR, QFM (1, 2, 3, 7, 8)

Assessment methods and criteria

ILV: final exam, assessment of active course participation