Showing 1 - 10 of 7,465
Two of the three elements of the ACA's "premium stabilization program," reinsurance and risk corridors, are set to … adjustment model itself are mathematically equivalent to a conventional actuarially fair reinsurance policy. Furthermore, closely … related modifications of the transfer formula or the risk adjustment model can improve on conventional reinsurance by figuring …
Persistent link: https://www.econbiz.de/10012456160
transferring risk are being explored. The paper studies several recent transactions by USAA which use reinsurance capacity from … demonstrate that both features deviate from what theory would predict, yet are characteristic of many transactions, not simply …
Persistent link: https://www.econbiz.de/10012471497
with natural hazards, such as hurricanes and earthquakes. Risk management theory suggests protection by insurers and other … relatively little cat reinsurance against large events. We also find that premiums are high relative to expected losses …, especially after cat events. We then examine clinical evidence to understand why the theory fails. Specifically, we examine …
Persistent link: https://www.econbiz.de/10012470619
supply of intermediary capital is perfectly elastic. We take the US catastrophe reinsurance market as an example, using … results suggest that the price of reinsurance generally exceeds fair' values, particularly in the aftermath of large events …
Persistent link: https://www.econbiz.de/10012472807
We explore two theories that have been advanced to explain the patterns in U.S. catastrophe reinsurance pricing. The … second holds that the supply of capital to the reinsurance industry is less than perfectly elastic, with the consequence that … prices are bid up whenever existing funds are depleted by catastrophe losses. Using detailed reinsurance contract data from …
Persistent link: https://www.econbiz.de/10012472774
This paper examines the optimal design of insurance and reinsurance policies. We first consider reinsurance for … catastrophes: risks which are large for any one insurer but not for the reinsurance market as a whole. Reinsurance for catastrophes … public optimal reinsurance employs a deductible-style deductible-style excess-of-loss policy, and when is is private but the …
Persistent link: https://www.econbiz.de/10012472911
Marketplaces established by the Affordable Care Act implement reinsurance and risk corridors. Reinsurance limits insurer costs …'s distribution of expected costs. This paper considers the economic costs and consequences of reinsurance and risk corridors. Drawing … the optimal insurance policy for insurers. Then, we simulate the insurer's cost distribution under reinsurance and risk …
Persistent link: https://www.econbiz.de/10012458152
Catastrophe bonds feature full collateralization of the underlying risk transfer, and thus abandon the insurance principle of economizing on collateral through diversification. We examine the theoretical foundations beneath this paradox, finding that fully collateralized instruments have...
Persistent link: https://www.econbiz.de/10012465918
risky investment, underwriting, reinsurance, and hedging; and ii) the allocation of risk across all of these opportunities …
Persistent link: https://www.econbiz.de/10012468510
distributed through the insurance and reinsurance systems. However, because insurance companies tend to share relatively small …
Persistent link: https://www.econbiz.de/10012471496