The University of Zurich (UZH) is building a new Centre for Finance and Insurance. The Swiss Re Foundation has donated CHF 2 million to help establish this centre within the university's Department of Banking and Finance. The purpose of the centre is to advance research and education in the application of finance theory to insurance.
In recent decades, there has been a clear trend towards using economic valuation and economic capital approaches in the insurance sector. This trend has had an impact not only on insurers' internal valuation and performance measurement systems but also on the accounting systems, regulatory solvency requirements and entire risk management of these firms. At the same time, the development of a much-needed solid theoretical backbone to support the frameworks being implemented has lagged behind. Recognising the need to strengthen academic efforts in this area, and determined to contribute to developing a rigorous foundation to support emerging practice, the Department of Banking and Finance decided to establish a centre with this focus and provide a finance theory-based approach to value creation in the insurance sector.
As one of the largest global reinsurers, Swiss Re has a particular interest in promoting research and education in its industry. In this context, the Swiss Re Foundation has donated CHF 2 million to help kick-start the centre. The centre is independent of the Swiss Re Foundation. In academic matters, it answers to the Department of Banking and Finance. The centre's academic freedom is fully guaranteed and the subject of an agreement.
Centre to offer training and continued education
The mission of the centre is to further develop the theoretical foundations of how insurance companies operate from a corporate perspective, in particular in the areas of valuation, capital requirements and risk governance. In addition, the centre is committed to providing education in this subject at all levels, including continuing education, and as such will play an important role in fostering new and growing talent in disciplines that are critical to insurance firms. The Director of the Centre is Pablo Koch Medina, PhD, who combines a strong academic track record with many years of experience in the insurance industry.
Prof. Thorsten Hens, director of the Department of Banking and Finance at the University of Zurich, emphasises that "the donation of the Swiss Re Foundation helps the Department of Banking and Finance in its endeavour to give more prominence to the application of finance theory to insurance. This is particularly important for a location such as Zurich, which is one of the most important insurance centres worldwide. I am confident that more insurance companies will come forward to support the centre."