Topics in Regulatory Economics and Policy

Catastrophe Insurance

Consumer Demand, Markets and Regulation

Authors: Grace, M.F., Klein, R.W., Kleindorfer, P.R., Murray, M.R.

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About this book

1. THE PROBLEM OF CATASTROPHE RISK The risk of large losses from natural disasters in the U.S. has significantly increased in recent years, straining private insurance markets and creating troublesome problems for disaster-prone areas. The threat of mega-catastrophes resulting from intense hurricanes or earthquakes striking major population centers has dramatically altered the insurance environment. Estimates of probable maximum losses (PMLs) to insurers from a mega­ catastrophe striking the U.S. range up to $100 billion depending on the location and intensity of the event (Applied Insurance Research, 2001).1 A severe disaster could have a significant financial impact on the industry (Cummins, Doherty, and Lo, 2002; Insurance Services Office, 1996a). Estimates of industry gross losses from the terrorist attack on September 11, 2001 range from $30 billion to $50 billion, and the attack's effect on insurance markets underscores the need to understand the dynamics of the supply of and the demand for insurance against extreme events, including natural disasters. Increased catastrophe risk poses difficult challenges for insurers, reinsurers, property owners and public officials (Kleindorfer and Kunreuther, 1999). The fundamental dilemma concerns insurers' ability to handle low-probability, high-consequence (LPHC) events, which generates a host of interrelated issues with respect to how the risk of such events are 1 These probable maximum loss (PML) estimates are based on a SOD-year "return" period.

Table of contents (6 chapters)

  • Introduction

    Grace, Martin F. (et al.)

    Pages 1-5

  • An Overview of Catastrophe Insurance Markets

    Grace, Martin F. (et al.)

    Pages 7-37

  • Regulatory Institutions and Policies

    Grace, Martin F. (et al.)

    Pages 39-72

  • Supply, Demand and Regulation of Catastrophe Insurance

    Grace, Martin F. (et al.)

    Pages 73-89

  • Demand Estimation for Homeowners Insurance Policies

    Grace, Martin F. (et al.)

    Pages 91-121

Buy this book

eBook $129.00
price for USA (gross)
  • ISBN 978-1-4419-9268-0
  • Digitally watermarked, DRM-free
  • Included format: PDF
  • ebooks can be used on all reading devices
  • Immediate eBook download after purchase
Hardcover $199.00
price for USA
  • ISBN 978-1-4020-7469-1
  • Free shipping for individuals worldwide
  • Usually dispatched within 3 to 5 business days.
Softcover $169.00
price for USA
  • ISBN 978-1-4613-4867-2
  • Free shipping for individuals worldwide
  • Usually dispatched within 3 to 5 business days.
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Bibliographic Information

Bibliographic Information
Book Title
Catastrophe Insurance
Book Subtitle
Consumer Demand, Markets and Regulation
Authors
Series Title
Topics in Regulatory Economics and Policy
Series Volume
45
Copyright
2003
Publisher
Springer US
Copyright Holder
Kluwer Academic Publishers
eBook ISBN
978-1-4419-9268-0
DOI
10.1007/978-1-4419-9268-0
Hardcover ISBN
978-1-4020-7469-1
Softcover ISBN
978-1-4613-4867-2
Edition Number
1
Number of Pages
IX, 147
Topics