Corporate Hedging in the Insurance Industry: The Use of Financial Derivatives by US Insurers [Discussion]

The use of financial derivatives is widespread yet controversial, so it is timely that these authors provide an analysis of what kind of insurers tend to use which instruments, and also some insights into why they use them. This is an important paper, both in cataloguing what is done and in trying to explain the relationships found. Towards the latter if offers several hypotheses, but in many cases further work is needed to develop alternative hypotheses and test them.

[Discussion begins on page 32 of the PDF.]