Autori
Bruno, Maria GiuseppinaGrande, AntonioOliva, Clara FabiolaTitolo
Anomalous demand and supply in cat risks insurance marketPeriodico
Annali del Dipartimento di metodi e modelli per l'economia, il territorio e la finanzaAnno:
2015 - Volume:
16 - Pagina iniziale:
51 - Pagina finale:
62Insurance is a classical tool to hedge against risks. Thanks to the law
of large numbers, it pools funds from a large number of similar exposures to
pay for the losses incurred by somehow. The theory tells us that all risk-adverse
people is willing to buy insurance if the premium is actuarially fair or even if the
price of the coverage is greater than the expected loss. However, what happens
in the insurance market of catastrophic risks is completely different: demands
for cat covers, subscribed voluntarily, are rare. Paying a premium for a risk with
low probability but high loss, even if it is fair, is considered an overprotection.
This is probably due to incomplete information. This irrationality in the demand
does not allow insurance firms to reach the critical mass, necessary to define
the right capital allocation. This is one of the reasons why cat covers are not so
widespread in the insurance market. In the present paper, we investigate the
anomalous behaviour of demand and supply for cat policies and we study some
possible solutions. We focus on the Italian flood risks insurance market and we
illustrate the critical aspects of the evaluation and rate making process under an
actuarial point of view.
SICI: 2385-0825(2015)16<51:ADASIC>2.0.ZU;2-X
Testo completo:
https://web.uniroma1.it/memotef/sites/default/files/MariaGiuseppinaBruno_AntonioGrande_ClaraFabiolaOliva_51-62_2015.pdfEsportazione dati in Refworks (solo per utenti abilitati)
Record salvabile in Zotero
Biblioteche ACNP che possiedono il periodico