Author:

Keywords:

Actuarial, Comparative analysis, Hypotheses, Insurance, Methods, Probability, Reinsurance, Risk, Simulation, Theory, Variance analysis, Optimal

Abstract:

A practical procedure for studying reinsurance programs is discussed. Unlike the actuarial theory, which tries to determine the optimal program from among all the possible reinsurance programs, this procedure only makes it possible to compare a limited number of given programs. This is an advantage because the necessary hypotheses are much less strict than in the actuarial theory. The proposed procedure can be used for most insurance branches, but its application is presently restricted to the fire branch. It is limited to the pure fire risk, without taking into account allied perils. This procedure provides all the statistical information needed to make a well-founded choice among a limited number of reinsurance programs, together with the necessary parameters to put the existing actuarial theories on optimal reinsurance into practice