A dynamic model of extreme risk coverage : Resilience and e fficiency in the global reinsurance market
type: Dataset
description: This paper presents a dynamic model of the reinsurance market for catastrophe risks. The model is based on the classical capacity-constraint assumption. Reinsurers choose every year the quantity of risk they cover and the level of external capital they raise to cover these risks. The model exhibits time dependency and reproduces a market dynamics that shares many features with the real market. In particular, market price increases and reinsurance coverage decreases after large shocks, and a series of smaller losses may have a deeper impact than one larger loss. There is a significant oligopoly effect reducing reinsurance supply, and the market is segregated into strategic large actors that influence market prices and price-taker smaller firms. A regulation trade-off between market efficiency and resilience is identified and quantified: improving the ability of the market to cope with exceptional events increases the cost of reinsurance. This model provides an interesting basis to analyze further capacity needs for the insurance industry in view of growing worldwide exposure to catastrophic risks and climate change.
landing page: https://shs.hal.science/halshs-00800460
keyword: dynamic-model
keyword: infoeu-reposemanticspreprint
keyword: jel-c---mathematical-and-quantitative-methodscc6---mathematical-methods--programming-models--ma
keyword: jel-q---agricultural-and-natural-resource-economics--environmental-and-ecological-economicsqq5--
keyword: natural-disaster
keyword: preprints-working-papers-
keyword: regulation
keyword: reinsurance
keyword: shsecohumanities-and-social-scienceseconomics-and-finance
issued: 2026-05-12T19:11:47.900818
modified: 2026-05-12T19:11:47.900825
language: en
contact point: Organization
  fn: CCSD

test_moissonnage_selune
type: Agent

A dynamic model of extreme risk coverage : Resilience and e fficiency in the global reinsurance market
type: Distribution
format: HTML
access URL: https://shs.hal.science/halshs-00800460
issued: 2026-05-12T19:11:47.909891
modified: 2026-05-12T19:11:47.875293