Financial Economics, Regulation and Law Module

Welcome to the Financial Economics, Regulation and Law Module home page! Please review all of the information and links provided below.

This module will help you understand the following three forces affecting the business of general insurance:

• Financial Economics: Financial economics is the discipline underlying all financial services. It is the study of how individuals and institutions acquire, save, and invest money. These activities are fundamental to institutions and individuals, including risk taking financial institutions such as general insurance companies.
• Regulatory Environment: It is important for actuaries to understand the regulatory environment under which insurance operates. Insurance is a highly regulated industry. There are many reasons for this, but it is often justified on the basis that regulation is required to protect the public interest. Insurance accepts premium up front for the potential of a recovery at a later date based upon the occurrence of a contingent event. The public generally lacks the expertise to fully understand the insurance product and needs protection from the potential of insurer insolvencies.
• Legal Environment: There are many laws that are relevant to general insurance. It is important to understand the legal environment that affects the industry. This includes contract law, tort law and international law.