operating risk may behave as if they were more risk averse in investment decisions. Specifically, we study how operating risk … from underwriting insurance policies affects insurers' risk taking behavior in their portfolio investments. We find that … risk -- they have lower credit risk exposure in their bond investments, as well as lower portfolio weights on risky bonds …

and risks. This has been amplified by the lack of a sound operational risk estimate due to the scarcity of the relevant … Dragon Kings regime for the largest events. With respect to risk assessment, our main finding is that risk is dominated by …