The Future of Parametric Insurance and Innovations in Risk Trading

A special issue of Risks (ISSN 2227-9091).

Deadline for manuscript submissions: closed (20 August 2022) | Viewed by 3902

Special Issue Editor


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Guest Editor
Carl H. Lindner College of Business, University Of Cincinnati, Cincinnati, OH 45221, USA
Interests: risk economics; decision-making and prevention decisions under risk; insurance markets; catastrophe risk management; innovation in risk markets

Special Issue Information

Dear Colleagues,

I am pleased to invite you to join our Special Issue on “The Future of Parametric Insurance and Innovations in Risk Trading“. Our world is becoming increasingly unpredictable given the growing trends in pandemics, floods, wildfires, and other natural and non-natural catastrophes. The insurance industry needs to be prepared for this highly volatile future by offering a reliable infrastructure that can quickly and objectively settle claims around even the most unforeseeable events. Alternative risk transfer and parametric insurance solutions have been available since the late 1990s, but only recently found their way into corporate insurance markets. Parametric solutions offer a fast payout after a predefined triggering event has occurred and thereby protect against unpredictable catastrophic risks in ways traditional insurance cannot. New technologies like blockchain and smart contracts offer a new infrastructure for validating, storing, and transferring information in a highly secure and reliable way. In the past few years, we have seen major advances in innovation for the (re-)insurance industry and this Special Issue invites you to contribute on this topic. Research areas and topics of interest may include (but are not limited to) the following: Innovation in the insurance industry, Alternative Risk Transfer and the future of risk trading, parametric insurance markets, the interconnection between financial and (re-)insurance markets, as well as systemic risks and catastrophe risk management solutions. Similar topics as related to the future of the insurance industry are also welcome.

I look forward to receiving your contributions!

Dr. Annette Hofmann
Guest Editor

Manuscript Submission Information

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Keywords

  • Parametric insurance
  • Parametric risk trading
  • Alternative risk transfer
  • Systemic risks
  • Innovation in insurance

Published Papers (1 paper)

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Research

16 pages, 902 KiB  
Article
Parametric Insurance—A Possible and Necessary Solution to Insure the Earthquake Risk of Romania
by Nicoleta Radu and Felicia Alexandru
Risks 2022, 10(3), 59; https://doi.org/10.3390/risks10030059 - 8 Mar 2022
Cited by 4 | Viewed by 3041
Abstract
The rapid growth over recent decades of the impact of natural disasters on economies, especially in vulnerable areas, urges stakeholders to promote innovative solutions involving risk transfers that account for the new risk exposures. These proposed solutions are designed to optimize and expedite [...] Read more.
The rapid growth over recent decades of the impact of natural disasters on economies, especially in vulnerable areas, urges stakeholders to promote innovative solutions involving risk transfers that account for the new risk exposures. These proposed solutions are designed to optimize and expedite the indemnification process, which can ultimately be beneficial for both policyholders and insurers alike. This article explores the possibility of supplementing the current Romanian dwelling insurance protection scheme with a parametric mechanism. To determine the triggering parameter of the insurance pay-out, the authors consider various hazard scenarios developed based on historical events. This paper focuses on Probable Maximum Loss (PML) determination computed for events with epicenters in the Vrancea (a region and a mountain in the Carpathians) seismic area. This area is the most exposed in Romania to earthquakes, and it includes the capital, Bucharest, which is the urban area with the highest population concentration and, consequently, the highest exposure to the discussed risks. Full article
(This article belongs to the Special Issue The Future of Parametric Insurance and Innovations in Risk Trading)
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