CAS Online Course
Introduction to Enterprise Risk Management

October 2 - 19, 2009

Course Information

At this time attendees should obtain and read the Lam text, Enterprise Risk Management: From Incentives to Controls, chapters 1-4, 9, 13, 14, 16, 19 and 20.

• Reading List
• Enter the Classroom

Instructors

Professor Stephen P. D’Arcy, FCAS
University of Illinois at Urbana-Champaign

Professor Richard W. Gorvett, FCAS, ARM, FRM
University of Illinois at Urbana-Champaign

Overview

Enterprise Risk Management (ERM) is the application of basic risk management principles to all risks facing an organization. Under ERM, hazard, financial, strategic and operational risks are integrated into a single framework. ERM is becoming an important issue partly as the result of the Sarbanes-Oxley Act of 2002 that puts greater responsibility on the Board of Directors for managing all an organization’s risks. Although the initial focus of ERM was as a method for avoiding the derivative disasters that occurred for many firms, ERM is now developing into a tool that can be used to optimize firm value. Risks are divided into core risks, which a firm should have a competive advantage in coping with, and non-core risks, which can more effectively be transferred or hedged. This course is intended to introduce actuaries to the field of ERM and to show how many actuarial skills and techniques are applied in ERM.

This module consists of twelve lectures, along with exercises and an exam, which will be delivered over the Internet using the Casualty Actuarial Society’s Internet Web Site and provided on a CD to all participants. The course will be taught asynchronously so participants can fit the work into their individual schedules. The lectures will consist of PowerPoint slides and audio. (Participants must have Microsoft Office PowerPoint software in order to participate in the class). The exercises and exam will be questions based on the lecture material and readings that will test the student’s grasp of the subject matter.

The readings for the course will include selected chapters from one textbook (Lam, James, 2003, Enterprise Risk Management: From Incentives to Controls), plus additional readings that have been published by the CAS, the SOA, and academic journals, and Internet sources. During the course, participants will take part in a chat space devoted to discussions of exercises and topics related to the course.

The lectures in this module will cover the following topics:

1. Introduction to ERM
2. ERM in Context
3. ERM in Practice
4. ERM Framework
5. Hazard Risk
6. Financial Risk
7. Operational Risk
8. Strategic Risk
9. Risk Metrics
10. Application of ERM
11. COSO Framework: PROs and CONs
12. Conclusion

The course will presume no prior knowledge of enterprise risk management. Enrollment is limited to a maximum of 40 participants. Those enrolled in the course will be given a user name and password that must be used to gain entrance to the Web pages of the online course. After you receive your login information and the online material has been posted online, please check to make sure that your login information operates correctly.

To insure all participants receive the course materials in a timely manner, registration for this course will close on September 21, 2009.

Registration Information

* An active candidate has attempted at least one actuarial exam in the last two years.

CANCELATION/REFUNDS: Registrations fees will be refunded for cancellations received in writing at the CAS Office via fax, 703-276-3108, or email, refund@casact.org, by September 25, 2009 less a $100 processing fee.

Please contact Leanne Wieczorek with any questions or problems.

Continuing Education

The Casualty Actuarial Society (CAS) designates this educational activity for a maximum of up to 12.0 CE Credits. Participants should claim credit commensurate with the extent of their participation in the activity. CAS members earn 1 CE Credit per 50 minutes of educational session time not to include breaks and/or lunch.

The CAS Code of Professional Conduct states that, “an actuary shall perform professional services when the actuary is qualified to do so and meets applicable qualification standards.” The American Academy of Actuaries (AAA) establishes qualification standards for public statements of actuarial opinion in the United Sates of America. Those standards require that actuaries update and maintain knowledge of applicable principles of actuarial science and actuarial standards of practice and their satisfaction through continuing education. The AAA publication Qualification Standards for Prescribed Statements of Actuarial Opinion provides a complete list of guidelines concerning continuing education. Actuaries attending a CAS seminar to satisfy AAA requirements should review all guidelines in that publication.