Publication:
Insurance Risk Transfer and Categorization of Reinsurance Contracts

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dc.contributor.authorGurenko, Eugene N.
dc.contributor.authorItigin, Alexander
dc.contributor.authorWiechert, Renate
dc.date.accessioned2013-01-29T18:12:34Z
dc.date.available2013-01-29T18:12:34Z
dc.date.issued2012-12
dc.description.abstractDespite the existence of numerous quantitative approaches to the categorization of financial reinsurance contracts, often insurance regulators may find the practical implementation of the task to be technically challenging. This research paper develops a simple, affordable, and robust regulatory method that can help insurance regulators to categorize financial reinsurance contracts as reinsurance or financial instruments. By reviewing real examples of different categorization methods, this paper explains how the proposed method standardizes such categorization. It also summarizes the existing pertinent literature on the subject with the view to helping insurance regulators to first apply some simple indicators to flag the main issues with financial reinsurance contracts that may need further reviews. Having identified the suspicious reinsurance contracts, supervisors may consider several solutions provided by the authors and, in some cases, requiring further quantitative testing of risk transfer contracts for categorization purposes, supervisors may also consider adopting the Standardized Expected Reinsurer's Deficit approach to contract testing presented in this paper. The approach advocates the use of a simple standardized stochastic method that would allow market participants and regulators to perform robust quantitative tests quickly and at an affordable cost. Besides addressing the obvious drawbacks of the "10-10" test, the proposed alternative method allows a great reduction in the technical challenges posed to the users of the Expected Reinsurer's Deficit approach based on full stochastic models with only a minimum loss of predictive accuracy.en
dc.identifierhttp://documents.worldbank.org/curated/en/2012/12/17124490/insurance-risk-transfer-categorization-reinsurance-contracts
dc.identifier.doi10.1596/1813-9450-6299
dc.identifier.urihttps://hdl.handle.net/10986/12205
dc.languageEnglish
dc.language.isoen_US
dc.publisherWorld Bank, Washington, DC
dc.relation.ispartofseriesPolicy Research Working Paper; No. 6299
dc.rightsCC BY 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttp://creativecommons.org/licenses/by/3.0/igo/
dc.subjectACCOUNTING STANDARD
dc.subjectACCOUNTING STANDARDS
dc.subjectACTUARIES
dc.subjectAMOUNT OF RISK
dc.subjectAUDITORS
dc.subjectBALANCE SHEET
dc.subjectBROKERAGE
dc.subjectBULK REINSURANCE
dc.subjectCAPITAL MARKETS
dc.subjectCAPITAL REQUIREMENTS
dc.subjectCASH FLOW
dc.subjectCASH FLOWS
dc.subjectCASH INFLOWS
dc.subjectCASUALTY
dc.subjectCATASTROPHE BONDS
dc.subjectCATASTROPHE LOSS
dc.subjectCATASTROPHES
dc.subjectCEDANT
dc.subjectCEDANTS
dc.subjectCEDING INSURER
dc.subjectCEDING INSURERS
dc.subjectCERTIFIED PUBLIC ACCOUNTANTS
dc.subjectCOMMISSIONS
dc.subjectCOMMODITY PRICE
dc.subjectCOVERAGE
dc.subjectCREDIT RATING
dc.subjectCREDITOR
dc.subjectDEGREE OF RISK
dc.subjectDEPOSIT
dc.subjectDEPOSIT LIABILITY
dc.subjectDEVELOPING COUNTRIES
dc.subjectECONOMIC RISK
dc.subjectECONOMICS
dc.subjectEXCESS OF LOSS REINSURANCE
dc.subjectEXCHANGE RATE
dc.subjectFINANCIAL INSTITUTIONS
dc.subjectFINANCIAL INSTRUMENT
dc.subjectFINANCIAL INSTRUMENTS
dc.subjectFINANCIAL REINSURANCE
dc.subjectFINANCIAL REPORTING
dc.subjectFINANCIAL RISK
dc.subjectFINANCIAL RISKS
dc.subjectFOREIGN EXCHANGE
dc.subjectFRAUDULENT TRANSACTIONS
dc.subjectINNOVATIONS
dc.subjectINSPECTIONS
dc.subjectINSURANCE
dc.subjectINSURANCE COMMISSIONERS
dc.subjectINSURANCE COMPANY
dc.subjectINSURANCE INDUSTRY
dc.subjectINSURANCE POLICIES
dc.subjectINSURANCE PREMIUM
dc.subjectINSURANCE RISK
dc.subjectINSURANCE SUPERVISION
dc.subjectINSURANCE SUPERVISORS
dc.subjectINSURED EVENTS
dc.subjectINSURERS
dc.subjectINTEREST RATE
dc.subjectINTEREST RATES
dc.subjectINTERNATIONAL BANK
dc.subjectINVESTMENT INCOME
dc.subjectLEVEL OF RISK
dc.subjectLIABILITY INSURANCE
dc.subjectLIMIT OF LIABILITY
dc.subjectLOSS RATIO
dc.subjectLOSS STATEMENT
dc.subjectMARKET PARTICIPANTS
dc.subjectMARKET PLAYERS
dc.subjectMATURE MARKETS
dc.subjectMATURITIES
dc.subjectMITIGATION
dc.subjectMOTIVATION
dc.subjectNATURAL CATASTROPHE
dc.subjectPARTICIPATIONS
dc.subjectPORTFOLIO
dc.subjectPORTFOLIOS
dc.subjectPREMIUMS
dc.subjectPROFIT SHARING
dc.subjectPROGRAMS
dc.subjectPROPORTIONAL REINSURANCE
dc.subjectQUOTA SHARE REINSURANCE
dc.subjectRATES
dc.subjectREGULATORY AUTHORITIES
dc.subjectREINSURANCE
dc.subjectREINSURANCE ACCOUNTING
dc.subjectREINSURANCE AGREEMENT
dc.subjectREINSURANCE COMMISSION
dc.subjectREINSURANCE COMPANIES
dc.subjectREINSURANCE CONTRACT
dc.subjectREINSURANCE CONTRACTS
dc.subjectREINSURANCE PREMIUMS
dc.subjectREINSURANCE TREATY
dc.subjectREINSURER
dc.subjectREINSURERS
dc.subjectRELIEF
dc.subjectRETURNS
dc.subjectRISK EXPOSURE
dc.subjectRISK MANAGEMENT
dc.subjectRISK TRANSFER
dc.subjectSETTLEMENT
dc.subjectSOLVENCY
dc.subjectTARGET RISK
dc.subjectTRANSACTION
dc.subjectTREATIES
dc.subjectTREATY REINSURANCE
dc.subjectUNDERWRITING
dc.subjectVALUATION
dc.titleInsurance Risk Transfer and Categorization of Reinsurance Contractsen
dspace.entity.typePublication
okr.crosscuttingsolutionareaJobs
okr.crossref.titleInsurance Risk Transfer and Categorization of Reinsurance Contracts
okr.date.disclosure2012-12-01
okr.date.doiregistration2025-04-10T12:13:09.887318Z
okr.doctypePublications & Research::Policy Research Working Paper
okr.doctypePublications & Research
okr.docurlhttp://documents.worldbank.org/curated/en/2012/12/17124490/insurance-risk-transfer-categorization-reinsurance-contracts
okr.globalpracticeSocial, Urban, Rural and Resilience
okr.globalpracticeSocial Protection and Labor
okr.globalpracticeFinance and Markets
okr.globalpracticeGovernance
okr.guid685801468328580905
okr.identifier.doi10.1596/1813-9450-6299
okr.identifier.externaldocumentum000158349_20121227231325
okr.identifier.internaldocumentum17124490
okr.identifier.reportWPS6299
okr.language.supporteden
okr.pdfurlhttp://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2012/12/27/000158349_20121227231325/Rendered/PDF/wps6299.pdfen
okr.topicLaw and Development::Insurance Law
okr.topicInsurance and Risk Mitigation
okr.topicUrban Development::Hazard Risk Management
okr.topicSocial Protections and Labor::Labor Policies
okr.topicFinance and Financial Sector Development::Debt Markets
okr.unitDevelopment Research Group (DECRG)
okr.volume1 of 1
relation.isSeriesOfPublication26e071dc-b0bf-409c-b982-df2970295c87
relation.isSeriesOfPublication.latestForDiscovery26e071dc-b0bf-409c-b982-df2970295c87
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