CAS Webinar: The Roulette Wheel and the Drunken Sailor: Principal-Agent Theory and its Ramifications for Insurance and Reinsurance Risk Management

Event Details

12:00 - 1:30 PM EDT

About This Event

One of the foundational challenges in insurance and reinsurance is how to price risk and how to manage risk. Historically, answers have been developed by applying the contexts of Portfolio Theory, Enterprise Risk Management (ERM), Rate of Return, Cost of Capital, and Capital Allocation to insurance and reinsurance. However, the insurance industry has mostly skipped over the framework of Principal-Agent Theory (PAT), which provides a different approach to these questions of how to price insurance risk and how to manage insurance risk.introduction to the paper.

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