Insurance as one of operational risk management tool

Operational risk has recently become one of the key issues in financial institutions - there have been two main reasons for development of operational risk. First, there was the explicit incorporation of operational risk in the document called Basel II; second, there have been high losses from operational loss events. The insurance as one of operational risk's tool is the main point of the rigorous thesis. In theoretical part, this tool is analyzed in relation to the operational risk (the insurability of operational risk, the main characteristic of insurance, the obstacles in the usage of this tool, its relation to capital and capital adequacy, benefits and negatives of this tool). In practical part, the use of insurance as operational risk management tool in one Central European bank is analyzed in order to find some relation to operation risk parameters as risk categories, business lines, gross loss etc. The identification of risk areas in bank was done as well. The main reason of this identification is finding whether the most risk areas are managed by this tool. The analysis should confirm or refute the hypothesis that insurance is relevant factor in operational risk management - whether it has positive influence on reduction of risk exposition or whether it is only formal tool