Investigate The Dispersion Mechanism Of The Catastrophe Risk Market

With the developing of society and progressing of the civilization, trend of people and fortune centralization becomes more and more obvious . At the same time, natural and non-natural disaster frequency raise surprisingly, the harm of catastrophe becomes more and more dangerous. From the phenomenon of catastrophe in the most countries , we can get the same conclusion.Actually, during the developing progress of the world , one phenomenon is the market of insurance becomes more and more smaller, at the same time, the market of Cat market becomes imbalance , the demand excess the production of the Cat market obviously . So, it is important for us to study how to reduce the risk in our society through Cat insurance, and to study the risk-reduction system. But form our study in this aspect, there are a lots for us to do.From the market of insurance, the risk-reduction system rely on the re-insurance. Before 80 ages during last century, re-insurance play an important role and reduce the risk of Cat effectively. After 80 ages in 20 century, with the raising of Cat, re-insurance companies face a violent impact. At the same time, this risk-reduction system's shot-coming becomes obviously. So, looking for an effective risk-reduction system becomes very important. In recent years, with the developing of capital market, insurance companies find a lot of financial tools to transfer the Cat risk form insuring market to capital market, such as, Cat bonds, catastrophe swaps, contingent capital and catastrophe options.Cat security is a way to disperse Cat risk through capital market. Cat securitization appeared in a lot of countries during 80 ages in last century and booming in late. This is a most effective way to reduce Cat risk through capital market, and it is a important developing direction of the insurance market. One of the focus of this paper is to study the risk-reduction system of Cat security. In this paper, we keep an eye on the reason of Cat security's appearance and study the function of this tool deeply.At the last part of this paper, we analyse Cat security lead a new way to underwrite large project and develop the re-insurance market in our country. We also give some suggestions on constructing our Cat risk-reduction system through Cat securities.