Examining the Effects of Gradual Catastrophes on Capital Modelling and the Solvency of Insurers: The Case of COVID-19

Muhsin Tamturk, Dominic Cortis, Mark Farrell
2020 Risks  
This paper models the gradual elements of catastrophic events on non-life insurance capital with a particular focus on the impact of pandemics, such as COVID-19. A combination of actuarial and epidemiological models are handled by the Markovian probabilistic approach, with Feynman's path calculation and Dirac notations, in order to observe how a pandemic risk may affect an insurer via reduced business. We also examine how the effects of a pandemic can be taken into account both during and at
more » ... end of the process. Examples are also provided showing the potential effects of a pandemic on different types of insurance product.
doi:10.3390/risks8040132 fatcat:vztcqool4jgqzio73c2y3l7mdy