0910 FIN3230 A

							                   THE CHINESE UNIVERSITY OF HONG KONG

                             FIN3230 Life and Health Insurance
                                 Second Term 2009-2010


Session A: Tuesday 10:30am – 12:15am, Room 201, T.C. Cheng Building, United College
           Thursday 1.30pm – 2.15pm, Room 201, T.C. Cheng Building, United College
           Medium of Instruction: Cantonese and English

Session B:    Monday 9:30am – 11:15am, Room G04, Y.C. Liang Hall
              Thursday 4.30pm – 5.15pm, Room 304, Teaching Complex at Western Campus
              Medium of Instruction: Cantonese and English


Instructor: Mr. Yew Wey How


This course is structured in two sections:

Section A: Life Insurance

Learning Objectives

In this section, the students will gain the understanding of various aspects of life insurance,
including:

•   The nature of life and health insurance
•   Pricing of life insurance
•   Reserving of life insurance
•   Underwriting and marketing of life insurance
•   Life insurance company management

Learning Outcomes

It is anticipated that after this course students are able to explain the major issues in the operation of
life insurance.

Readings

•   Life and Health Insurance / Black, Skipper (13th edition), 2000, Chapters 1, 2, 4–6, 8-10 and
    23-30, 32-34.




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Section B: Health Risk

Learning Objectives

This section will provide the students with the knowledge of the problems of health care in the
United States and Hong Kong, the different types of insurance plans and insurance plan coverage,
and the types of managed care organizations and alternative healthcare plans available to patients.
The on-going healthcare financing reform in Hong Kong will also be discussed.

Learning Outcomes

It is anticipated that after this course students are able to explain the major health care issues in
America and Hong Kong, understand the basic characteristics of individual major medical
insurance, long-term care insurance, as well as disability-income plans. Students should be able to
develop guidelines when purchasing individual health insurance.

Readings

•   Principles of Risk Management and Insurance / Rejda (10th edition), 2008, Chapters 15 and
    16
    Textbook website: http://wps.aw.com/aw_rejda_prmi_10
•   Hong Kong’s Health System: Reflections, Perspectives and Visions / Leung, Bacon-Stone, 2006
         Part IV Commentary: Health Financing Reform by Gabriel M. Leung and John Bacon-
         Shone
         Chapter 19: Health Financing in Hong Kong: The Current Status by Raymond Yeung and
         Chan Wai-Sum
         Chapter 20: A Systematic Approach to Reforming Hong Kong's Health Financing: The
         Harvard Proposal by Winnie Yip and William Hsiao
         Chapter 21: Health Financing and Resources: New Government Proposals by Looi-Looi
         Low and Su-Vui Lo
•   Hong Kong Government Health Care Reform Consultation Reports:
    http://www.fhb.gov.hk/en/press_and_publications/consultation/HCS.HTM
    http://www.fhb.gov.hk/beStrong/eng/consultation/consultation.html
    http://www.fhb.gov.hk/en/press_and_publications/consultation/HCR1.HTM

Learning Activities

                   Lecture                           Seminar             Project Presentation
          In class         Out class                  In class         In class        Out class
         Ten 3-hour                                 One 3-hour        Two 3-hour
                        3 hours/week                                                 1 hour/week
          sessions                                    session          sessions
             M                M                          M                M               M
            M: Mandatory activities in the course       O: Optional activity   NA: Not applicable




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Assessment Scheme

There will be one final examination, one life insurance pricing group project and one life and
health insurance group project. Students are required to attend the seminar and all project
presentation sessions. The final grade will be weighted as follows:

              Task Nature                                                 Percentage
              Group project: life insurance pricing                          15%
              Group project: life and health insurance product               25%
              Attendance to seminar and project presentation sessions        10%
              Final centralized examination                                  50%
              Total                                                         100%

Life Insurance Pricing Project

This is a group project. You are required to build an Excel spreadsheet model to price life
insurance, to assess reserve and cash value, and to find profitable insurance premiums. This project
also requires a written report. The details will be provided in a document.

Life and Health Insurance Project

This is a group project on life and/or health insurance. This group project is about conducting a
product review of life and/or medical insurance products of your choice. The objective and scopes
are detailed in a document. The group project requires both written report and presentation in class.
The details will be provided in a document.




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Course Schedule

    Week             Topic items                                       Readings
    #1               The nature of life and health insurance           Black and Skipper
    Jan 11 – 15                                                        Chapter 1, 4 – 6, 8
    #2               Life insurance pricing fundamentals               Black and Skipper
    Jan 18 – 22                                                        Chapters 2, 27 and 28
    #3               Life insurance reserving                          Black and Skipper
    Jan 25 – 29                                                        Chapters 29 and 30
    #4               Premium determination and surplus distribution    Black and Skipper
    Feb 1 – 5                                                          Chapters 23 and 30
    #5               Underwriting and Marketing of life insurance      Black and Skipper
    Feb 8 – 12                                                         Chapters 24 to 26
    #6               Life financial management and reporting           Black and Skipper
    Feb 22 – 26                                                        Chapters 32 to 34
    #7               Practical life insurance                          Black and Skipper
    Mar 1 – 5                                                          Chapters 9 to 10
    #8               Individual Health Insurance Coverages             Redja Chapter 15
    Mar 8 – 12
    #9               Group Health and Managed Care Plans               Redja Chapter 16
    Mar 15 – 19
    #10              Individual Health Insurance in Hong Kong          n/a
    Mar 22 – 26
    #11              Life Insurance Seminar (date, time and venue to be confirmed)
    Mar 29 – Apr 2
    #12              Project presentation
    Apr 5 – 9
    #13              Project presentation
    Apr 12 – 16

Feedback for Evaluations

•    Course Teaching Evaluation. To be conducted during the last two weeks of lectures.
•    Focus-group meeting. To be conducted in May 2010.
•    Performance in test and examination. Assessment of what has been achieved by the students.

Course Materials and Announcements

A course website has been set up in WebCT. Students can download all the course materials from
this website. All course announcements will be made during lectures and through the course
website.

Academic Honesty and Plagiarism

Attention is drawn to University policy and regulations on honesty in academic work, and to the
disciplinary guidelines and procedures applicable to breaches of such policy and regulations.
Details may be found at http://www.cuhk.edu.hk/policy/academichonesty/.




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