Finance 341:Property-Liability Insurance

Instructor:Stephen D’Arcy

Teaching Assistant:Joanna Rodgers

Lecture 1:Introduction and Course Organization

General Course InformationPrerequisite:

Basic knowledge of insurance terminology and personal lines coverage (Fin 260)

Course focus - three components:1 Insurance Operations2 Commercial Property and Liability Exposures and Coverages3 Current Events

Insurance RegulationWorld Trade Center AttackFinancial Services DeregulationCatastrophesInsurance SecuritizationCaptive Insurers

Required Textbook

Risk Management and Insurance by Pritchett, Schmit, Doerpinghaus and Athearn (Seventh Edition) (Fin 260 Text)

Optional TextbooksOn 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 Websitehttp://www.cba.uiuc.edu/

~s-darcy/fin341/2002/index.htmlThe site contains the syllabus, lecture notes (posted about one week prior to class), class projects (after covered in class) and assignments (approximately one week prior to due date).

General Purpose of Course

Fin 260 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 industry.

Review1. The News-Gazette had a picture of a car buried in a

mudslide in Peru. If this had been your car, would this be a covered by your personal auto policy?

2. Would mercury contamination be covered under a Homeowners policy?

3. If you threw away some old paint that contaminated a landfill and you were found liable, would your Homeowners policy cover you?

Review - continued

4. If you stepped in front of a car and forced it to crash to avoid hitting you, would you be liable to the driver?

5. Would your auto policy or your homeowners policy cover you for this incident?

6. You are trying to sell your car and you let a potential buyer take it for a test drive. If the person caused an accident, would he/she be covered under your auto insurance policy?

Class Project #1

• Form into groups of 3-4 people

• Appoint one person to lead the discussion

• Appoint another person to take notes and write the group’s decision

• Appoint a third person to explain the group’s decision to the class

What’s next?Eight lectures on the general structure of insurance companies and functions within the company.

Review and first exam.

NIne lectures on commercial property and liability coverages and workers compensation.

Review and second exam.

Six lectures on current events.

Review and final exam.