This course provides an overview of the principles of risk management and insurance. The focus is on the management of risks by businesses and organizations. However, personal risks are also discussed. Topics on insurance covers the operation of insurance markets, insurance pricing, insurance regulations, insurance products, legal principles of insurance. An introduction of insurance industry in Macao and Hong Kong is covered. In order to minimize the overlap with other finance courses, this course will not cover derivative instruments and there will be minimal coverage of exchange rate risk and interest rate risk.

CILO-1: Compare and contrast different decision making methods in evaluating simple risky situations. CILO-2: Explain the steps involved in the risk management process and describe how risk management can help maximize shareholder wealth. CILO-3: Describe different risk management tools (insurance and other Alternative Risk Transfer methods) and explain their appropriate uses. CILO-4: Recognize the effect of Moral Hazard and Adverse Selection on Insurance markets and how insurer responses to them. CILO-5: Outline the basic legal principles and introduces the features of different insurance products.