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082045 (M54, M11) An actuarial approach to property catastrophe cover rating
Abstracts and Reviews of Table 1994 R a detailed model is presented which in particular illustrates the previously described actuarial requirements.
Keywords: Reserving, Life, Biometric Parameters.
235
10. Reserves for accumulation risks, 11. Claims reserves, 12. Equalization fund, 13. Reserves for cancellation. The appendix contains related laws and decrees.
Keywords: Reserves, Funds, Balance sheet law. 082040 (M40, BI0) Equivalence of reserve methodologies. Sharp K.P., Transactions of the Society of Actuaries, Volume XLVII (1995), pp. 71-84 The paper considers policies with annual premiums and discusses four types of life insurance reserves calculations: curtate, fully continuous, discounted continuous, and semicontinuous. It is shown that when appropriate corrections are made, each method gives the same reserve; this is as expected in view of the equality of the actual cash flows. The paper concludes with consideration of the methods used in making a practical year-end valuation.
Keywords: Reserves, Life-lnsurance, Cash Flow. 082041 (M40, B10) Vorfinanzierung von Leistungen aus der Gewinnbeteiligung in der Lebensversicherung. Ailerdissen K., Markwort J., Pannenberg M., Schmithals B., Deutsche Gesellschafi )ear Versicherungsmathematiker, Blgitter, Band XXII, Heft 3, April 1996, pp. 563-579 When introducing an immediate profit participation for endowment policies, a considerable advance financing is needed. In this note the necessity of a compensation for this advance financing within the underlying profit sharing system is explained, and an algorithm is presented which provides for a compensation in a natural way.
Keywords: Profit Sharing. 082042 (M40, M41, M42, B10, B20, B50, B70) Handbuch der v e r s i c h e r u n g s t e c h n i s c h e n R0ckstellungen, Boetius J., Verlag Dr. Otto Schmidt, 1996 This handbook - undertitled "Commercial Law and Tax Balance Sheet Law of Insurance Companies" deals with the various aspects of actuarial reserves in Germany in the train of deregulation. Its main chapters are 1. Introduction into the balance sheet law of insurance companies, 2. Legal bases of the creation of actuarial reserves, 3. Survey of actuarial reserves, 4. Ageing reserve, 5. Reserves for refund of contributions, 6. Premium surplus, 7. Level premium reserve, 8. Reserves for future losses, 9. Reserves for major risks,
M43: LOSS RESERVES (INCLUDING I.B.N.R.) 082043 (M43) Solvenzsicherungsmodelle. Maneth M.F.F., Zeitschrift,/°ar die gesamte Versicherungswissenschafi, Volume 84, 1995, pp. 329-362 This article deals with the problems of solvency protection in insurance companies, and thus with the question: Which economic and social conditions determine preferences and targets of investors and management and how can these conditions be structured to assume that any insurance company operates with an optimal amount of solvency capital?
Keywords: Solvency
M51: RISK SHARING ARRANGEMENTS 082044 (M51) The Cost of Risk and the Concept of Risk Partnership. Reid J.W., The Geneva Papers on Risk and Insurance, 20 (No. 76, July 1995) 279-284. A recent survey in UK has highlighted the large discrepancy between the insured and uninsured costs of losses, demonstrating that the true cost of risk is much higher than previous estimates. Risk is never totally transferred by insurance, and if insureds recognise that they retain a partial ownership of the risk there is a greater likelihood that there will be better loss control. The paper promotes the concept of "risk partnership" as a more correct representation of the contract between insurer and insured than the more generally used term of "risk transfer".
Keywords: Risk transfer.
M54: CATASTROPHIC RISKS 082045 (M54, Mll) An Actuarial Approach to Property Catastrophe Cover Rating. Gogol D.F., Proceedings of the Casualty Actuarial
236
Abstracts and Reviews
Society, Volume LX_XXI, Number 154, May 1994, pp. 135 Forty-one years of catastrophe loss data by state are used in this study to produce a model for rating catastrophe covers for insurers in any region of the continental United States. Smooth surfaces are fitted to the dam by region, and experience rating is applied in an attempt to give appropriate weight to regional departures from the smoothed results. Severity distributions and frequencies are estimated for each region, and a method for applying them in pricing catastrophe covers is discussed. A method for using the experience of an insurer to produce an experience modification is also presented. Keywords: Catastrophe, Rating. 082046 (M54, B52) Reinsurance of Environmental Risk Pricing and Risk Assessment. Bellenbaum R., The Geneva Papers on Risk and
Insurance, 20 (No. 76, July 1995) 393-401 Despite the increasing liberalization of insurance markets, the principle of the locality of an insurance business remains decisive for General Liability business and particularly for the insurance of environmental impairment liability. General Liability insurance has its basis in national legislation and there is no need to describe how much this legislation differs with respect to environmental liability between the European countries. Keywords: Reinsurance, Environmental Risk. 082047 (M54) Natural Hazards as the Cause of Toxic Spills in the United States, with some Notes on Liability. Showalter P.S., The Geneva Papers on Risk and
Insurance, 20 (No. 76, July 1995) 325-335 Natural disasters that create technological emergencies by causing the release of dangerous materials such as o i l , chemicals, or radiological/infectious agents are called "na-tech" events (Showalter and Myers 1992). Although there has yet to be a catastrophic na-tech event in the United States, low impact events are fairly common. An example of this occurred a few weeks ago when, during flooding in Texas, an oil pipeline ruptured by floodwaters exploded. The potential for a serious na-tech event is rising, however, because the US, like many industrialized countries, is greatly dependent on the production and use of chemicals. For example, industry manufactures
millions of gallons of gasoline and millions of pounds of herbicides every day. Additionally, in 1985, approximately 200,000 facilities in the US generated 275 million metric tons of hazardous waste. Many of these facilities, as well as those that store, transport, and/or use such toxic materials, are vulnerable to the different types of natural hazards that exist in a country as large as the US. In an effort to obtain baseline data regarding na-tech events that occurred in the past, and to estimate their potential for the future, the Natural Hazards Research and Applications Information Center (University of Colorado-Boulder) performed a literature search and surveyed US state emergency management agencies. Among the findings was a clear trend toward increasing numbers ofna-tech events, with the largest promotion of incidents involving interaction with earthquakes, followed by climatic-related events such as hurricanes, floods, lightning, and winds. However, only rarely was evidence presented that governmental policies or legislation directly recognized the possibility for such events. Part of the reason that na-tech events are not addressed directly is because disaster planning tends to be "agentspecific" with separate, distinct plans organized around specific natural agents, such as floods, or artificial agents, such as hazardous material releases. Because of this, emergency planners rarely prepare for na-tech events, per se, instead relying on guidelines in agentspecific documents (such as are found in the National Flood Insurance Program) to reduce the impact of such events. The Hazard Center's survey asked emergency planners for recommendations to reduce damage from future natech events. Among the recommendations was a desire to engage the insurance industry via a long-term program to adjust insurance rates so that they reflect the adoption of mitigation measures that minimize the potential for disaster-generated damages, economic losses, and injuries. This paper identifies some of the options, and obstacles, that currently face the insurance industry when it attempts to deal with natural or technological events, and endeavors to relate these issues to na-tech events. Keywords: Catastrophic risks. 082048 (M54) Uninsurability: a Growing Problem. Vermaat A. J., The Geneva Papers on Risk and
Insurance, 20 (No. 77, October 1995) 446-453.
Keywords: Reserving, Life, Biometric Parameters.
235
10. Reserves for accumulation risks, 11. Claims reserves, 12. Equalization fund, 13. Reserves for cancellation. The appendix contains related laws and decrees.
Keywords: Reserves, Funds, Balance sheet law. 082040 (M40, BI0) Equivalence of reserve methodologies. Sharp K.P., Transactions of the Society of Actuaries, Volume XLVII (1995), pp. 71-84 The paper considers policies with annual premiums and discusses four types of life insurance reserves calculations: curtate, fully continuous, discounted continuous, and semicontinuous. It is shown that when appropriate corrections are made, each method gives the same reserve; this is as expected in view of the equality of the actual cash flows. The paper concludes with consideration of the methods used in making a practical year-end valuation.
Keywords: Reserves, Life-lnsurance, Cash Flow. 082041 (M40, B10) Vorfinanzierung von Leistungen aus der Gewinnbeteiligung in der Lebensversicherung. Ailerdissen K., Markwort J., Pannenberg M., Schmithals B., Deutsche Gesellschafi )ear Versicherungsmathematiker, Blgitter, Band XXII, Heft 3, April 1996, pp. 563-579 When introducing an immediate profit participation for endowment policies, a considerable advance financing is needed. In this note the necessity of a compensation for this advance financing within the underlying profit sharing system is explained, and an algorithm is presented which provides for a compensation in a natural way.
Keywords: Profit Sharing. 082042 (M40, M41, M42, B10, B20, B50, B70) Handbuch der v e r s i c h e r u n g s t e c h n i s c h e n R0ckstellungen, Boetius J., Verlag Dr. Otto Schmidt, 1996 This handbook - undertitled "Commercial Law and Tax Balance Sheet Law of Insurance Companies" deals with the various aspects of actuarial reserves in Germany in the train of deregulation. Its main chapters are 1. Introduction into the balance sheet law of insurance companies, 2. Legal bases of the creation of actuarial reserves, 3. Survey of actuarial reserves, 4. Ageing reserve, 5. Reserves for refund of contributions, 6. Premium surplus, 7. Level premium reserve, 8. Reserves for future losses, 9. Reserves for major risks,
M43: LOSS RESERVES (INCLUDING I.B.N.R.) 082043 (M43) Solvenzsicherungsmodelle. Maneth M.F.F., Zeitschrift,/°ar die gesamte Versicherungswissenschafi, Volume 84, 1995, pp. 329-362 This article deals with the problems of solvency protection in insurance companies, and thus with the question: Which economic and social conditions determine preferences and targets of investors and management and how can these conditions be structured to assume that any insurance company operates with an optimal amount of solvency capital?
Keywords: Solvency
M51: RISK SHARING ARRANGEMENTS 082044 (M51) The Cost of Risk and the Concept of Risk Partnership. Reid J.W., The Geneva Papers on Risk and Insurance, 20 (No. 76, July 1995) 279-284. A recent survey in UK has highlighted the large discrepancy between the insured and uninsured costs of losses, demonstrating that the true cost of risk is much higher than previous estimates. Risk is never totally transferred by insurance, and if insureds recognise that they retain a partial ownership of the risk there is a greater likelihood that there will be better loss control. The paper promotes the concept of "risk partnership" as a more correct representation of the contract between insurer and insured than the more generally used term of "risk transfer".
Keywords: Risk transfer.
M54: CATASTROPHIC RISKS 082045 (M54, Mll) An Actuarial Approach to Property Catastrophe Cover Rating. Gogol D.F., Proceedings of the Casualty Actuarial
236
Abstracts and Reviews
Society, Volume LX_XXI, Number 154, May 1994, pp. 135 Forty-one years of catastrophe loss data by state are used in this study to produce a model for rating catastrophe covers for insurers in any region of the continental United States. Smooth surfaces are fitted to the dam by region, and experience rating is applied in an attempt to give appropriate weight to regional departures from the smoothed results. Severity distributions and frequencies are estimated for each region, and a method for applying them in pricing catastrophe covers is discussed. A method for using the experience of an insurer to produce an experience modification is also presented. Keywords: Catastrophe, Rating. 082046 (M54, B52) Reinsurance of Environmental Risk Pricing and Risk Assessment. Bellenbaum R., The Geneva Papers on Risk and
Insurance, 20 (No. 76, July 1995) 393-401 Despite the increasing liberalization of insurance markets, the principle of the locality of an insurance business remains decisive for General Liability business and particularly for the insurance of environmental impairment liability. General Liability insurance has its basis in national legislation and there is no need to describe how much this legislation differs with respect to environmental liability between the European countries. Keywords: Reinsurance, Environmental Risk. 082047 (M54) Natural Hazards as the Cause of Toxic Spills in the United States, with some Notes on Liability. Showalter P.S., The Geneva Papers on Risk and
Insurance, 20 (No. 76, July 1995) 325-335 Natural disasters that create technological emergencies by causing the release of dangerous materials such as o i l , chemicals, or radiological/infectious agents are called "na-tech" events (Showalter and Myers 1992). Although there has yet to be a catastrophic na-tech event in the United States, low impact events are fairly common. An example of this occurred a few weeks ago when, during flooding in Texas, an oil pipeline ruptured by floodwaters exploded. The potential for a serious na-tech event is rising, however, because the US, like many industrialized countries, is greatly dependent on the production and use of chemicals. For example, industry manufactures
millions of gallons of gasoline and millions of pounds of herbicides every day. Additionally, in 1985, approximately 200,000 facilities in the US generated 275 million metric tons of hazardous waste. Many of these facilities, as well as those that store, transport, and/or use such toxic materials, are vulnerable to the different types of natural hazards that exist in a country as large as the US. In an effort to obtain baseline data regarding na-tech events that occurred in the past, and to estimate their potential for the future, the Natural Hazards Research and Applications Information Center (University of Colorado-Boulder) performed a literature search and surveyed US state emergency management agencies. Among the findings was a clear trend toward increasing numbers ofna-tech events, with the largest promotion of incidents involving interaction with earthquakes, followed by climatic-related events such as hurricanes, floods, lightning, and winds. However, only rarely was evidence presented that governmental policies or legislation directly recognized the possibility for such events. Part of the reason that na-tech events are not addressed directly is because disaster planning tends to be "agentspecific" with separate, distinct plans organized around specific natural agents, such as floods, or artificial agents, such as hazardous material releases. Because of this, emergency planners rarely prepare for na-tech events, per se, instead relying on guidelines in agentspecific documents (such as are found in the National Flood Insurance Program) to reduce the impact of such events. The Hazard Center's survey asked emergency planners for recommendations to reduce damage from future natech events. Among the recommendations was a desire to engage the insurance industry via a long-term program to adjust insurance rates so that they reflect the adoption of mitigation measures that minimize the potential for disaster-generated damages, economic losses, and injuries. This paper identifies some of the options, and obstacles, that currently face the insurance industry when it attempts to deal with natural or technological events, and endeavors to relate these issues to na-tech events. Keywords: Catastrophic risks. 082048 (M54) Uninsurability: a Growing Problem. Vermaat A. J., The Geneva Papers on Risk and
Insurance, 20 (No. 77, October 1995) 446-453.