The Master's research paper on the theme:

"Risk management of the insurance company" (adapted from PJSC "Insurance Company

"Dnipro")Student:

Kryklyvets Y. , FC-10 m

Supervisor:

Associate Professor, Ph.D. in Economics,

Victoria Varenik

Dnipropetrovsk 2015

Alfred Nobel University DnipropetrovskThe Department of Finance and Banking

ContentsINTRODUCTION 

CHAPTER 1. THEORETICAL ASPECTS OF RISK MANAGEMENT OF THE INSURANCE COMPANY

1.1. The essence of risk management of the insurance company

1.2. Methods of risk management of the insurance company

1.3. Analysis of risk management of insurance companies in Ukraine

CHAPTER 2. ANALYSIS OF RISK MANAGEMENT OF PJSC "INSURANCE COMPANY" DNIPRO "

2.1. Organizational and economic characteristics of PJSC "Insurance Company" Dnipro "

2.2. The practice of risk management at JSC "Insurance Company" Dnipro "

2.3. Assessing the level risks of JSC "Insurance Company" Dnipro "

CHAPTER 3. IMPROVED RISK MANAGEMENT of PJSC "Insurance Company" Dnipro "

3.1. Optimization of the tariff policy of JSC "Insurance Company" Dnipro "

3.2. Developing measures for reducing of insurance risks in PJSC "Insurance Company" Dnipro "

3.3. The introduction of risk management to PJSC "Insurance Company" Dnipro "

Conclusions and suggestions

APPLICATIONS

REFERENCES

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The Purpose of the research is the theoretical synthesis and development of practical recommendations for risk management of insurance companies.

The Object of the research – risks of insurance company.

The subject of the research is risk management of the insurance company.

The research base is Joint-Stock Company "Insurance Company" Dnipro “.

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The structure of economic risk profile4

Fig.1. The structure of economic risk profile

The structure of PJSC "Insurance Company" Dnipro “ earnings, 2012-

2013

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Risk management in PJSC "Insurance Company" Dnipro“ is performed in the following order:

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Implementation of risk identification

Research methods of risk management

Substantiation and choice of methods and tools most relevant for PJSC "Insurance Company" Dnipro"

Implementation and use of the selected method and tools for risk management

Monitoring results to improve management

Fig. 4. The risk management process of PJSC "Insurance Company" Dnipro "

The method of financing risks of PJSC "Insurance Company" Dnipro "

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Risks PJSC "Insurance Company" Dnipro "

Performancerisks

Investmentrisks

Non-technicalrisks

Risksinsured

insurance reserves

the organization reserves

trust receiptborrowingstheir free funds

Fig. 5. The mechanism of risk coverage of PJSC "Insurance Company" Dnipro "

Risk analysis PJSC "Insurance Company" Dnipro "

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Risks The risk level

1 2

Market risks High level

Underwriting risks Intermediate

Operational risks Above average

Liquidity risk Below average

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External factors

the extent and probability of risk

number of concluded contracts

the value of the sum insured

the level of deterioration of equipment

area of the object

engineering and technology

infrastructure development

professional level

subjective factors in liability insurance

Tariffrate of PJSC "Insurance Company"

Dnipro "

Internal factors

economic organizational and technical social psychological

Fig. 6. Factors affecting tariff rate of PJSC "Insurance Company" Dnipro "

Measures to reduce risks10

State level

Funding of measures to improve road safety

The need to legislate contributions to preventive measures of traffic police

Creating a unified information system in order to exchange information in the implementation of compulsory insurance

Legislate the status of emergency commissioners of Ukraine to develop common requirements and standards

Create a registry of independent experts and method of assessing damages

Fig.7. Measures to reduce risks in the field of compulsory insurance at the state level

At the level of PJSC "Insurance Company" Dnipro "

The use of discounts and bonuses "bonus-malus"

Setting bit coefficient Insurance Vehicle

When insuring more than one vehicle discounts

Refusal extension contract for vehicle in which the cost of repair for insurance event was more than 70%

Fig.8. Measures to reduce risks in the field of compulsory insurance at the level of PJSC "Insurance Company" Dnipro”

Risk management for PJSC "Insurance Company" Dnipro"

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The preparatory phase of risk management - a comparison of the characteristics and risk probabilities derived from the analysis and risk

assessment

The choice of specific measures - promotion eliminate or minimize the potential negative consequences of risk

The introduction of risk management in PJSC "Insurance Company" Dnipro "

Fig. 9. The introduction of risk management in PJSC "Insurance Company" Dnipro”

Stress testing for PJSC "Insurance Company" Dnipro"

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Adjustments scenarios in case of changes in the environment

Development of "scenarios" of evaluation of the probability of their realization

Definition of "extreme" result for PJSC "Insurance Company" Dnipro "

Identification of legal aspects of management, including various kinds of legal and by-laws (regulations)

Stage 1 - preparatory

Stage 2 - Analysis

Stage 3 -constructive

Stage 4 - final("Proof")

Fig.10. Sequence (steps) of stress testing in PJSC "Insurance Company" Dnipro "