Abstract
This article provides a case study that analyzes national macroprudential insurance regulation in Switzerland. We consider an insurance market that is based on data from the Swiss private insurance industry. We stress this market with several scenarios related to financial and insurance risks, and we analyze the resulting risk capitals of the insurance companies. This stress-test analysis provides insights into the vulnerability of the Swiss private insurance sector to different risks and shocks.
Highlights
The insurance market is an important sector to the real economy
We will shock these by stressing risk factors which we categorize into two groups: in Section 3.1 we consider financial market risk factors, and in Section 3.2 we consider other risk factors that do not directly impact the total market capitalizations, such as biometric risks and risks arising from policyholder behavior
Since we study a local market with domestic currency choose Swiss franc (CHF), we only focus on assets with this underlying currency
Summary
The insurance market is an important sector to the real economy. On the one hand, insurance companies provide financial services such as protection against financial losses and channeling savings into investments. It is of great importance that the insurance industry as a whole is resilient to adverse scenarios This motivates us to consider the (Swiss) insurance market from a macroprudential perspective. This macroprudential analysis provides insights into the ability of the Swiss insurance market to absorb or to augment different risks and shocks. We introduce an insurance market that has features similar to those of the Swiss market, see Section 5 for details We stress this market with different scenarios and analyze their impacts on the balance sheet positions of the insurance companies
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
