This morning, I would like to give a few practical commentson capital adequacy from an insurance companyperspective. In doing so, I will present two views on capitaladequacy and capital allocation in the insurance industry.The first view is the regulatory perspective, that is, themotivations...

Lots of agreement within the industry; Need to coordinate with other projects; Need to avoid replicating problems with mortgage bonds...

In spite of the fact that they can draw on a larger, more liquid and more diversifiedpool of capital than the equity of reinsurance companies, financial markets have failed to displace reinsurance as the primary risk-sharing vehicle for natural catastrophe risk. We show that this failure can be...

It is widely recognized that "market failure" prevents efficient risksharing in natural disaster insurance. As a consequence, many countriesadopted institutional frameworks presenting public sector participation,often praised as public-private partnerships. We define risk selection asa situation...