This paper develops a pricing methodology and pricing estimates for the proposed Federal excess-of- loss (XOL) catastrophe reinsurance contracts. The contracts, proposed by the Clinton Administration, would provide per-occurrence excess-of-loss reinsurance coverage to private insurers and...

Following Hurricane Andrew (1992) and the Northridge earthquake (1994), insurance companies expended considerable resources on the measurement and management of the risk of natural catastrophes. Unfortunately, the next major “catastrophic loss” that the industry would face would be a man...