Financial Reinsurance Of Domestic Insurance Company Solvency

Financial reinsurance is originated from the US Property and Casualty (P&C) Insurance market in the 1980s. At that time, the P&C market suffered significant losses due to natural disasters and turned to reinsurance companies for financial support. As a result, financial reinsurance - a new product different from traditional reinsurance, was created. Since 1990s, the Life Insurance companies have found that financial reinsurance would also be helpful to their financial management and risk control, and therefore have applied it into Life Insurance Industry. In China, although there is limited financial reinsurance experience, some companies have started to use it to strengthen the internal financial management, to meet with solvency regulation requirements, and to prepare for the development and restructure of the company.This thesis is mainly focused on the concept, history and development of financial reinsurance. It also includes some examples of financial reinsurance practice in oversea market, typical solvency regulation models in foreign countries and an analysis of China's new solvency regulations system. In addition, this thesis discusses the financial insurance case in ABC Company by comparing its impacts on solvency and other ratios before and after financial insurance and analyzing how it improved the company's solvency. The thesis will be concluded by a summary of the above mentioned thoughts and open to the discussions of the prospects and some pending issues.