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Introduction
Today’s insurance industry reflects the globalised world in which it operates. The expansion of business
into other countries and regions carries risks to be insured, and an ever-greater number of insurers are
expanding the scope of their business to meet these needs. Insurers can predict losses more accurately
with an increasing number of risks insured and, at the same time, minimise the risk of experiencing large
losses by spreading their exposures geographically.
The W01 study text prepares you for a career in this international industry. It ‘sets the scene’ by
introducing the concept of risk and how it is managed, as well as the different categories of risk. It also
explains how insurance acts as a risk transfer mechanism and introduce the main classes of insurance.
Our examination of the insurance market includes the structure of the market, its main participants and
the various professional roles found there. We then go on to look at the main legal principles that apply
to insurance. We devote chapters to contract and agency, good faith, proximate cause, indemnity,
contribution and subrogation.
Chapter 9 looks at insurance industry regulation, including the role and functions of the International
Association of Insurance Supervisors (IAIS), as well as the importance of an insurer’s capital adequacy
and its relation to solvency control levels.
We also outline the growing importance of combating financial crime, and the role of the Financial Action
Task Force (FATF) in developing a strategy to combat money laundering and terrorist financing. The study
text then considers the issue of fraud and how insurers manage it.
The role and importance of ethics in the insurance industry is covered in the final chapter, where we
outline the core principles of the Chartered Insurance Institute’s Code of Ethics. This is followed by a
look at ‘fit and proper’ requirements and how and why an effective internal control system is necessary
for insurers. Reference copy for CII Face to Face Training