Although Catastrophe Insurance Futures (CATS) were created to allow insurers to hedge losses from catastrophes, trading has not been active. Possible explanations for this low daily volume are examined and the conclusion reached is that the characteristics of the CATS contract are substantially...

Agency theory leads to proposals that managers of asset portfolios would not necessarily maximize net return on invested assets for any level of risk. Because investment income accounts for approximately one third of the total income of life insurers, the rate of return on invested assets can...