Decentralized Model Of Catastrophe Risk And Catastrophe Bond Pricing Research

China is one of the countries which have natural disasters frequently. With the national economy soar and growth of population and fortune, the economic losses caused by natural disasters are increasing rapidly in recent years. However, the measures dealing with catastrophic risks are relevantly inadequate in China, which gather funds through governmental financial appropriation and donations from public etc. National awareness on catastrophic risk is weak, lacking of tools for transferring and dispersing catastrophic risks. Insurance and capital markets are making very limited efforts on dealing with catastrophic risks. The whole insurance industry only paid insurance indemnity of RMB1.66billion for the earthquake in Wen Chuan in2008, which was only0.196%of the total economic loss. It restricted the post-disaster reconstruction and rehabilitation work, and caused tremendous unplanned expenditures from the limited state finance as well.In order to lower the loss from catastrophe and improve management on catastrophic risk, we must learn from other countries regarding catastrophic risk management concept, practice and development, and explore the inner relation between the contribution system and the compensation term for dealing with catastrophic risks, so that to construct a diversified financing system for catastrophe, which suits China’s actual conditions.First of all, it introduces the identification, types and characteristics of catastrophic risk in this thesis, describing the fundamental status of China’s current catastrophic risks and damaging status. Through the analysis on "weakness", it briefly introduces the appraisal term for catastrophic risk. Secondly, it summaries key strategies on catastrophic risk management theoretically in this thesis. Through analyzing current status of catastrophic risk management in China, and taking the advanced experiences of other countries as reference, it studies current insufficiencies of China’s catastrophic risk management and the enlightenments from the advance management experiences of other countries. It also introduces and studies the current catastrophe insurance securitization tools. Thinking of the current actual situation in China, it discusses the necessity, feasibility and main ideas for implementing catastrophe insurance securitization. Finally, it recommends introducing the catastrophe insurance bond, and designing the insurance bond products for flood catastrophe based on the study of pricing mode of catastrophe insurance bond and related economic loss from flood catastrophe in China.