NSURING RISK IN NATURE AND INDUSTRY

1. Explain why using deterministic models for catastrophe loss modelling can understate the potential risk.

________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

(5 marks)

2. Describe what is meant by moral hazard in insurance. What can insurance companies do to reduce its occurrence? Give an example of a potential moral hazard issue outside of the insurance area.

(5 marks)

3. Explain the principle of large numbers and its application in insurance.

(5 marks)

4. Describe the key stages in a catastrophe model? (You may choose whether this captured in 3, 4 or 5 stages).

(5 marks)

5. Describe the management of flood risk through the UKís ëmemorandum of understandingí between insurers and the government. Discuss the relationship between climate change and flood modelling.

(10 marks)

6. A production line has a consecutive 3 part quality testing mechanism, QT1, QT2 and QT3.

If we consider the following probabilities:

Probability that QT1 operates properly= 0.76

Probability that QT2 operates properly =0.85

Probability that QT3 operates properly = 0.79

Design an event tree to demonstrate the routes to each of the possible outcomes. Work out the probability of each of the outcomes.

What is the probability that a faulty product will pass through the quality tests undetected?

(10 marks)

7. Identify the key types of air pollution. Describe how they are hazardous to the environment. Discuss the role of insurers in environmental risk.

(10 marks)

8. Describe in brief the key health concern of nanomaterials. Discuss the parallel with the insurance industryís experience of liabilities resulting from asbestos.

(10 marks)

9. Describe the critical success factors for effective integrated risk management.

(5 marks)

10. What is the significance of the requirement to ëestablish the contextí of an enterpriseís risk?

(5 marks)

11. Identify the theoretical tools used to control/manage the risks. How could these be implemented in a practical way within a financial institution?

(10 marks)

12. Describe in brief the evolution of the use of catastrophe modelling in insurance/reinsurance.

(5marks)

13. What are the typical key stages in a catastrophe model?

(10 marks)

14. What is meant by the terms Annual Average Loss (AAL) and the Exceedance Probability (EP)?

How are they typically calculated

How are they used in insurance/reinsurance?

(10 marks)

15. Discuss the relationship between climate change and catastrophe modelling (You can use a case study to illustrate).

(10 marks)

TAKE ADVANTAGE OF OUR PROMOTIONAL DISCOUNT DISPLAYED ON THE WEBSITE AND GET A DISCOUNT FOR YOUR PAPER NOW!