Vulnerability Analysis Of Insurance System Based On The Two-Layered Complex Networks

In recent years,the level of national income has continued to rise,the people’s awareness of insurance is increasing,and the risks they face are gradually becoming more complex.As a result,insurance functions have been more fully and effectively exerted.China’s insurance industry has ushered in a rapid stage of industry development.However,with the in-depth and rapid development of the insurance industry,we have to pay attention to the hidden dangers behind the development.In 2008,the failure of the American International Group(AIG)due to the CDS business is the best experience and lesson,which shows that the insurance industry has certain vulnerabilities,and the continuous accumulation of vulnerabilities will lead to the outbreak of a system crisis,which will bring serious negative effects to economic development and social stability.At a time when governments and academia have been unusually concerned about the issue of financial systemic risks,we should attach importance to the study of the vulnerability of the insurance system.However,there are few studies on the vulnerability of the insurance system,and the research entry point is also fragmented.There is no clear and recognized definition of the vulnerability of the insurance system,and there is no scientific and reasonable method for measuring the vulnerability of the insurance system.However,with the continuous development of complex network research,it has gradually penetrated into various disciplines,which has greatly promoted the development and practical application of complex network theory,and also provided a new perspective for the discussion of the vulnerability of insurance systems.Therefore,based on the theory of complex networks,this article analyzes the causes of the vulnerability of the insurance system from the traditional channels of insurance systemic risk-the reinsurance business and the innovative source of vulnerability of the insurance system-the insurance group,and builds a ReinsuranceGroup Two-Layered Complex Networks.Secondly,the cascading failure model is introduced into the Two-Layered Complex Networks,and the Two-Layered Cascading Failure Model is established to reasonably measure the dynamic vulnerability of the insurance system.Next,this article chooses cascade triggering(deliberate attack,random attack)to explore the degree and characteristics of dynamic vulnerability of the insurance system under different parameter combinations.Finally,it explores how to control the vulnerability of the insurance system from three perspectives: the source of vulnerability,the coefficient of risk contagion,and the vulnerability nodes.The main conclusions are as follows:(1)In the Two-Layered Complex Networks,the network cost threshold of the reinsurance network is larger,which means that the reinsurance network is more vulnerable.And the network is more vulnerable to deliberate attacks and to a linear relationship between risk load and risk capacity.(2)On the whole,the Two-Layered Complex Networks is the most vulnerable.Under random attacks,the probability of cascading failure of the single-layer reinsurance network is lower,and the severity is higher when cascading failure occurs.Under deliberate attacks,the probability of cascading failure in the single-layer group network is lower,and the severity of cascading failure is lower.(3)When the reinsurance loss ratio decreases,the magnitude of network vulnerability reduction under deliberate attacks is much larger than random attacks;(4)Most of the top ten nodes of the Two-Layered Complex Networks failure probability come from the group network,with life insurance companies,group parent companies and asset management Company-oriented.