Finance 431: Property-Liability Insurance Instructor: Stephen D’Arcy Teaching Assistant: Gerry Molidor Lecture 1: Introduction and Course Organization

General Course Information Prerequisite: Basic knowledge of insurance terminology and personal lines coverage (Fin 230) Course focus - three components: Insurance Operations Commercial Property and Liability Exposures and Coverages Current Events

Insurance Operations Overview of Industry and Profit Measures Underwriting Marketing and Distribution Systems Claims Adjusting Ratemaking Loss Reserving Reinsurance

Commercial Exposures and Coverages Commercial Property Insurance Commercial Liability Insurance Excess and Umbrella Policies Professional Liability Workers Compensation and Employers Liability

Current Events – Examples (These topics may change based on issues that emerge over the semester) Insurance Brokerage Issues Insurance Regulation Insurance Accounting/Finance Catastrophes Insurance Securitization Intellectual Property in Insurance

Required Textbook Risk Management and Insurance by Pritchett, Schmit, Doerpinghaus and Athearn (Seventh Edition) (Fin 230 Text)

Optional Textbooks On Reserve in the Undergraduate Library Insurance Operations by Webb, Harrison, and Markham;Volumes I and II Commercial Liability Risk Management and Insurance by Malecki, Horn, Wiening, and Flitner Volume II

Course Website http://www. business. uiuc Course Website http://www.business.uiuc.edu/ ~s-darcy/Fin431/2006/index.html The site contains the syllabus, lecture notes (posted about one week prior to class), class projects (after covered in class), assignments (approximately one week prior to due date) and keys (after the due date).

General Purpose of Course Fin 230 covered what every consumer needs to know about insurance. This class covers what someone intending to work in the insurance industry, as a risk manager, or as a corporate insurance buyer needs to know about the insurance industry.

Likely Guest Speakers Mark Vonnahme, Clinical Professor in Finance, Former CEO of CNA Surety Gail Ross, Senior Consultant, Milliman James Smieszkal, Senior Actuarial Analyst, Zurich North America Mark Strauch, VP, Arthur J. Gallagher & Co. James Matusiak, Actuary, PXRE Group

What You Should Know Now Class Project #1

What’s next? Seven lectures on the general structure of insurance companies and functions within the company. Review and first exam. Ten lectures on commercial property and liability coverages and workers compensation. Review and second exam. Six lectures on current events (the topics are subject to change). Review and final exam.