. This paper looks at the various approaches and methodology used in modelling the economy. The various approaches were …

that parimutuel insurance intrinsically leads to participants being underinsured due to basis risk. Although participants … will be underinsured, parimutuel insurance guarantees no underlying risk borne by the issuer. We also derive the equivalent … transaction costs of traditional insurance relative to HuRLOs. The actual transaction cost for traditional insurance is found to …