Decision Analysis Models in Reinsurance
Decision analysis models are developed and illustrated for the reinsurance (risk transfer) decisions made by insurance companies. Decision analytic models were found to be useful tools both for structuring multistage reinsurance decisions and for comparing alternative options. The insurer is faced w...
Saved in:
| Main Authors: | , |
|---|---|
| Format: | text |
| Language: | English |
| Published: |
Institutional Knowledge at Singapore Management University
1985
|
| Subjects: | |
| Online Access: | https://ink.library.smu.edu.sg/lkcsb_research/3869 https://doi.org/10.1016/0377-2217(85)90173-0 |
| Tags: |
Add Tag
No Tags, Be the first to tag this record!
|
| Institution: | Singapore Management University |
| Language: | English |
| Summary: | Decision analysis models are developed and illustrated for the reinsurance (risk transfer) decisions made by insurance companies. Decision analytic models were found to be useful tools both for structuring multistage reinsurance decisions and for comparing alternative options. The insurer is faced with many possible choices involving reinsurance type and extent, and an expected utility model provided insight both as a screening device and as an evaluation criterion. Decision analytic models appeared to be superior to other approaches such as mean/variance and risk of ruin models both because of their flexibility and their more comprehensive treatment the important elements of the decision, namely the complete claims distribution, the cost of reinsurance and the insurer's risk attitude. |
|---|