risky investment, underwriting, reinsurance, and hedging; and ii) the allocation of risk across all of these opportunities …

risky investment, underwriting, reinsurance, and hedging; and (ii) the allocation of risk across all of these opportunities …

This paper estimates a reduced-form model to assess the credit risk of General Insurance (GI) non-life firms in the UK … business lines; there is default clustering in the GI industry; different reinsurance levels also affect the credit risk of … insurance firms. The implications of these findings for regulators of GI firms under the coming Solvency II are discussed. …