Repricing of Home Insurance for the Adaptability of Climate Change
DOI:
https://doi.org/10.6981/FEM.202409_5(9).0013Keywords:
Homeowner Insurance; Climate Change; Repricing.Abstract
The spike in extreme weather events causes a crisis in the insurance industry. However, the odd homeowner rating algorithm for WGIC cannot handle this situation very much. To tackle the drawback, this paper discuss how the market get used to the climate change, the effect of cross-subsidies and more improvements. Add those catastrophe variables into the odd models to make the estimation more refined, and how to set up the model.
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[1] Lorenzo, F. et.al., 2023. An Insurance Risk Framework for Climate Adaptation, © 2023 Boston Consulting Group.
[2] Peggy, B. et. al., 2022 CATASTROPHE MODELS FOR WILDFIRE MITIGATION:QUANTIFYING CREDITS AND BENEFITS TO HOMEOWNERS AND COMMUNITIES, © 2022 Casualty Actuarial Society.
[3] CAS Online Course, 2022 The Infintie Actuary, LLC.
[4] Afghanistan – Devastating Flash Floods Claim Hundreds of Lives in Northern Provinces – FloodList.
[6] Chicago Fed Letter, No. 460, September 2021 https://www.chicagofed.org/publications/chicago-fed-letter/2021/460?utm_source=importantnotimportant.com&utm_medium=referral& utm_campaign=not-worth-the-risk.
[7] https://www.nber.org/papers/w32625.
[8] Pricing of Climate Risk Insurance: Regulation and Cross-Subsidies - Working Paper - Faculty & Research - Harvard Business School (hbs.edu).
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Copyright (c) 2024 Frontiers in Economics and Management
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
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