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RSK 715 - Risk Financing C22 (Online Accelerated)

Academic Credit Value:
3 units
Course Delivery Mode:
Hours of Study:
39 hours
Course Prerequisite(s):
Course Anti-requisite(s):
Instructor Name:
Adam Prokop
Course Dates:
06/15/2020 - 08/09/2020

Required Course Materials:
CRM 56 Risk Financing textbook and course guide, 6th edition
Optional Course Materials:
Course Description:
This course can be seen as the third course offering and continuation of the introductory course, Risk Financing, of the three part series of risk management courses.  It provides a broad understanding of the various risk financing techniques available for organizations to pay for losses.  Although the text emphasizes the financing options for hazard risk it also discusses the other major categories of risk, such as operational, financial, strategic risks from which losses may arise.  This course introduces the concept of paying for losses through various techniques or plans when the risk control efforts have either failed to prevent losses or a negative consequence of risk arises.  Such techniques include insurance, alternative risk financing solutions, hedging and more.  It is not a “business” finance course as most management students would think but rather a course that discusses how to effectively pay for losses, i.e. how the organization funds the payment of losses or negative consequences when they do occur.  Funds to pay for or offset losses can arise from internal sources such as cash flow or assets or from external sources such as shareholders, banks or insurance companies or even a combination of any of the above.
Learning Outcomes:

The primary learning objective of this course is to gain an understanding of the different risk financing techniques or plans that are available for an organization to pay for or offset its losses and to explain how such plans may be combined to design an effective risk financing program.

In this course you will:

  • Understand what risk financing is and the sources of risk for an organization
  • Describe the various risk financing objectives
  • Explain how an organization can manage and allocate  its cost of risk
  • Learn the different types of risk financing  techniques available such as retention, transfer or a hybrid plan
  • Explain the advantages and disadvantages of the various risk financing plans presented
  • Understand alternative risk financing plans that are available including how capital markets can be used to finance losses
  • Understand the impact of accounting and taxation on risk financing plans
  • Describe non insurance contractual risk transfers and the legal principles affecting risk financing
Course Evaluation
Participation: Group Discussions 10%
Quiz #1: Chapters 1-4 10%
Quiz #2: Chapters 5-8 10%
Quiz #3: Chapters 9-11 10%
Assignment 1: Chapters 1 - 7  25%                          
Assignment 2: Chapters 8-11 35% 

Course Format:

This course emphasizes student participation through group discussions.  It is expected that students will read the assigned chapters per the weekly requirements. 

During Week 3, 6, and 8 in the course, you will be required to participate in active discussions with your group. Your participation grade will be based on this work. You will have from the beginning of the week until the end of the week to participate. The goal is to have an active dialogue among course participants. Each discussion question will have a topic/article posted to guide your discussion.

WEBEX Sessions

During Week 3 and Week 6 of the course, there will be two online WEBEX sessions (similar to Skype) where the instructor will be available for two hours to check in on students' progress in the course, answer questions about Assignment #1, and provide general guidance. Attendance is mandatory, but it is recognized that it may be difficult to arrange a time that works for all students.

Peer Reviews

During Week 4 and Week 8 of the course, you will be required to submit a mandatory peer review through the surveys tool in A2L to indicate the participation of group members in the group discussions. Students with low ratings will have their participation grades adjusted to reflect their lack of contribution. 

Assignment Submission:
Course assignments are submitted to the appropriate A2L Assignment folder by the specified due date
Late Coursework:
Late assignments will be subject to a 2% per day late penalty (includes weekends and holidays) for up to seven (7) days. After this date, no assignments will be accepted and a grade of zero (0) will be applied. Extensions for course work must be approved by the instructor before the due date (see Academic Regulations), and will be granted for illness or emergencies only. Students may be asked to submit supporting documentation for an extension request. 

Policy & Procedures:

Academic Regulations (Attendance, Coursework, Tests/Exams):
In accordance to McMaster University’s General Academic Regulations, “it is imperative that students make every effort to meet the originally scheduled course requirements and it is a student’s responsibility to write examinations as scheduled.” Therefore, all students are expected to attend and complete the specific course requirements (i.e. attendance, assignments, and tests/exams) listed in the course outline on or by the date specified. Students who need to arrange for coursework accommodation, as a result of medical, personal or family reasons, must contact the course instructor within 48 hours of the originally scheduled due date. It is the student’s responsibility to contact the Program Manager/Program Associate at CCE to discuss accommodations and procedures related to deferred tests and/or examinations within 48 hours of the originally scheduled test/exam, as per policy. Failure to contact the course instructor, in the case of missed coursework, or the Program Manager/Program Associate, in the case of a missed test/examination, within the specified 48 hours window will result in a grade of zero (0) on the coursework/exam and no further consideration will be granted.

*Note: Supporting documentation will be required but will not ensure approval of accommodation(s).
Academic Integrity
(Please note that CCE will adhere to a zero tolerance application of the policy)

You are expected to exhibit honesty and use ethical behaviour in all aspects of the learning process. Academic credentials you earn are rooted in principles of honesty and academic integrity.  

Academic dishonesty is to knowingly act or fail to act in a way that result or could result in unearned academic credit or advantage. This behaviour can result in serious consequences, e.g. the grade of zero on an assignment, loss of credit with a notation on the transcript (notation reads: “Grade of F assigned for academic dishonesty”), and/or suspension or expulsion from the university.
It is your responsibility to understand what constitutes academic dishonesty. For information on the various types of academic dishonesty please refer to the Academic Integrity Policy, located at

The following illustrates only three forms of academic dishonesty:

  1. Plagiarism, e.g. the submission of work that is not one’s own or for which other credit has been obtained, including copying solution sets.
  2. Improper collaboration in group work. 
  3. Copying or using unauthorized aids in tests and examinations.
Academic Accommodations:
Students who require academic accommodation should contact Student Accessibility Services (SAS).  Staff at SAS will evaluate your learning needs and, if required, will provide a letter for the course instructor. It is the student’s responsibility to inform the instructor and Program Manager of any accommodation requirements at the start of the course.  For more information, contact SAS at ext. 28652 or visit
On-line Elements:
Material for this course may be accessed through McMaster's new learning system, Avenue2Learn (A2L). Your instructor will notify you if, or when, you will be required to login and use the tools and materials available through this on-line system. Computers are available for use in various locations across McMaster main campus including all libraries and Computer Labs.

To access Avenue to Learn go to: .  You will be required to enter your MAC ID (login and password). To activate your MAC ID, contact University Technology Services.
Course Changes:
The instructor reserves the right to modify elements of the course and will notify students accordingly.
Course Withdrawal Policy:
Withdrawal Deadline: 7 Days before the last scheduled class, is the last day to withdrawal to avoid academic penalty.  For the McMaster CCE refund policy, please visit /drop-policy
Storm Closure Policy:
In the event of inclement weather, the Centre for Continuing Education will abide by the University’s Storm Closure Policy:, and will only close if the University is closed. All in-class courses, exams and room bookings by internal and external clients will be cancelled if the Centre for Continuing Education is closed. On-line courses will take place as scheduled.
Grading Scale:


Grade Point

Equivalent Percentages








































Course Schedule:



Week 1


Chapter 1: Introduction to Risk Financing

Chapter 2: Estimating the Hazard Risk


Watch (Optional)

Watch Instruction Presentations

Week 2


Chapter 3: Transferring Hazard Risk Through Insurance

Chapter 4: Self-Insurance Plans


Watch (Optional)

Watch Instructor Presentations

Week 3


Chapter 5: Retrospective Rating Plans

Chapter 6: Reinsurance



Instructor Presentations (Optional)

Instructor Online WEBEX Session #1 – Assignment #1 Overview (Mandatory)

Week 4


Chapter 7: Captive Insurance

Assignment #1


Week 5


Chapter 8: Contractual Risk Transfer


Watch (Optional)

Watch Instructor Presentations

Week 6


Chapter 9: Transferring Financial Risk

Chapter 10: Transferring Hazard Risks to the Capital Markets



Watch Instructor Presentations (Optional)

Instructor Online WEBEX Session #2 – Assignment #2 Overview (Mandatory)

Week 7


Chapter 11: Allocating Costs of Managing Hazard Risk


Watch (Optional)

Watch Instructor Presentations

Week 8


Assignment #2