Management Development Institute, (MDI) Gurgaon launches a 4-month course on Risk Management and product pricing suitable for actuarial students, professionals working on actuarial projects, and consulting companies, in the insurance, banking and financial industry. The programme which is a 4 Month Joint Certificate Program on Risk Management and Product Pricing (Actuarial Perspective) is being offered by MDI and actuarial faculty members recommended by Institute of Actuaries of India (IAI). The new 4 months programme is scheduled to commence on Oct 29th, 2023, and run till Feb 25th 2024. Students will have to attend two online classes every Sunday and 3 Days of immersion at MDI’s Gurgaon campus.

According to Dr Ruchi Agarwal, Programme Director, Faculty-in Charge-Incubator, Professor of Strategy and Risk Management, “This 4-month futuristic course on Risk Management and product pricing is designed as per market demands for professional experts in the field of actuarial projects with consulting companies and in the insurance, banking and financial industry. The MDP program will focus on risk management and actuarial perspective with real-world case studies, insights from industry experts along with academics. The working project under the guidance of an actuary would provide pragmatic knowledge of how to design and price new products in the insurance business from the field. The course will be taught by the faculty of MDI along with actuaries and product pricing practitioners.”

Actuaries often use their professional knowledge and skills to predict the financial impact of the business and clients. In general, businesses and governments highly rely on actuaries for plans. Overall, an actuary requires multi-skills in core areas of financial and enterprise risk management with strong skills in Mathematics, Statistics, Data Analytics, and Finance with good analytical skills. Understanding of the insurance business environment is at the heart of actuarial science which sets the professional foundation.

Globally, actuaries play statutory roles in the insurance industry, employee benefits, social security, health benefits, government schemes and valuation of future liabilities. Their skills are valuable for long-term financial projects due to their professional rigour combined with their model-based solution for most complex commercial problems. “The salaries of an actuary are considered to be among the highest in the industry so far”, adds Dr. Ruchi Agarwal.

Why Actuarial Risk Management (ARM) is becoming increasingly important

In today’s business environment, companies need to become more resilient to deal with rising uncertainties in a turbulent business environment. This created a need for new products by businesses regularly. Insurance companies, brokers, and consulting companies, though, want to understand the new business requirements and offer their clients an appropriate product but there is a dearth of experts who can design such products.

ARM applications : Actuarial risk management is the application of actuarial science to the identification, assessment, and management of risks. ARM is an important tool for managing all types of risks, both financial and non-financial. By using ARM, organizations can reduce their losses, control uncertainty, and improve their decision-making. ARM is used in a wide range of industries, including insurance, banking, healthcare, and government. It is also used by individual investors to manage their personal financial risks.

Examples:

● Insurance companies: Actuaries use ARM to set premiums, design insurance products, and assess the financial impact of potential events, such as natural disasters or pandemics.

● Banks: Actuaries use ARM to assess the creditworthiness of borrowers, set interest rates, and manage the risk of losses on loans and investments.

● Healthcare organizations: Actuaries use ARM to set prices for healthcare services, manage the risk of medical malpractice lawsuits, and design health insurance plans.

● Government agencies: Actuaries use ARM to assess the financial impact of proposed legislation, manage the risk of natural disasters, and design social security programs.

● Individual investors: Actuaries can help individual investors to develop and implement risk management strategies for their investment portfolios.

Most of the time, actuaries are either hired by insurance companies, reinsurance companies, retrocession insurance companies, or IT companies. Particularly in India, companies like Swiss Re (reinsurance company), Capgemini, DXC, HCL Tech, Oracle, Wipro Digital (IT Companies), and Deloitte, EY, and Milliman (Accounting, auditing, actuarial consulting companies) hire actuaries extensively.

Impacts of having experts in the field of Actuarial risk management :

● Improved financial performance: ARM can help organizations to improve their financial performance by reducing their losses and optimizing their capital deployment.

● Reduced uncertainty: ARM can help organizations to reduce uncertainty by identifying and assessing the risks they face. This information can then be used to develop strategies to mitigate or manage the risks.

● Better decision-making: ARM can help organizations to make better decisions by providing them with a more complete understanding of the risks and consequences of their choices.

Skill sets of Actuarial risk management experts :

Actuaries are highly trained professionals with expertise in mathematics, statistics, and finance. They use these skills to develop and implement risk management strategies that help organizations achieve their financial and strategic objectives by managing any risk whatsoever.

Example : In the paucity of time to deliver a new customized product to the client, while completing actuarial calculations, the understanding of product pricing has become the need of hour for professionals working in insurance companies, reinsurance companies, retrocession insurance companies, or IT companies.

Pedagogy and Methodology

The methodology of the program will be highly interactive and will involve a mix of lectures, Group Discussions, case discussions, audio-video, and self-assessment through psychometric questionnaires with feedback.

As this is a specialized topic, lectures will be taken by experts. The classes will be held online followed by three days of immersion at the MDI campus.

MDP Coverage

The program will attempt to cover almost all the important subjects in product pricing related to insurance.

To illustrate the actuarial imperative of product pricing and sensitize the participants to deliver better in VUCA world.
To construct an understanding of the data
To discuss the value of Enterprise Risk Management
To understand case studies and the application of risk management in a product pricing context
Formulate an implementation program of risk management and product pricing from an actuarial perspective

Contents:

Enterprise Risk Management: Concept and Case Studies
ORSA and Allocation of Capital
Three Lines of Defense Model and Risk Culture
Risk management and Product Pricing
Foundation of Actuarial Theory and Practice
Product Pricing Process
Implementation of Product Pricing Project
Advanced topics in Product Pricing

Who should apply ?

Executives of insurance brokers, reinsurance broking firms, insurance companies and reinsurance companies
Middle-level managers and executives responsible for providing product pricing
Business consultants and consultancy firms looking to better advise clients and offer new products
Risk management and business continuity specialists
Actuarial students who want to build expertise

Programme Schedule

The programme is scheduled from 29 October 2023 online (two classes scheduled on every Sundays + 3 days immersion) till 25 February 2024. On every Sunday’s 2-sessions of 90 minutes, will be conducted online. In case, there is a scheduled holiday on Sunday for example Diwali and New Year, the classes will be held on Saturdays. Three-day immersion is scheduled on a residential basis at MDI Campus, Mehrauli Road, Sukhrali, Gurugram.

MDI will conduct 3-Days Residential Immersion Programme for the participants at the end. Accommodation for participants would be available at MDI Campus from noon of February 21, 2024, to the forenoon of February 25, 2024. A “Certificate” will be issued to the participants on successful completion of the training programme which would be followed by a dinner.

Course Fees

Participants should be nominated by their organizations. The enclosed nomination form should be completed and returned with all the details. The fee of the program is Rs. 1,25,000/- (One lakh Twenty-Five Thousand Only) which includes a professional fee and all charges for lodging and boarding and supply of course materials. GST as applicable will be charged extra in addition to the programme fee. Payment should be made by Cheque/NEFT/RTGS.

ABOUT MDI: Management Development Institute (MDI), Gurgaon, currently celebrating its 50 years, is consistently ranked among the top B-schools of India by reputed agencies and publications.

The Institute has earned accreditation from AACSB International, the world’s largest business education alliance. Considered the gold standard for B-schools around the world, the AACSB accreditation will ensure continuous improvement and provide focus for MDI Gurgaon to deliver on its mission, innovate, and drive impact.

Research is an important constituent of the Institute’s vision and mission. Consequently, MDI Gurgaon’s academic community is research active and carries out research work of a high international standard that contributes to the national goals of innovation, socio-economic development and environmental sustainability.

As of now, there are nearly 9,000 MDI Gurgaon alumni working across 45 countries. Training and development of managers is one of the major activities of MDI Gurgaon. Over 100,000 managers have been trained in the nearly 50 years of the Institute’s existence. The Institute prides itself for the personalized training modules that it offers to organizations of different kinds at different levels.

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