Research On Risk Regionalization And Pricing Of Earthquake Catastrophe Reinsurance

China is located between the Pacific earthquake belt and the Eurasian earthquake belt,and the frequency of earthquake disasters is high.The number of continental earthquakes accounts for one-third of the global continental earthquakes,and the deaths caused by earthquake disasters account for about half of the global earthquake deaths.Along with the development of society,our population is increasing rapidly and economy is growing rapidly,and disaster vulnerability is increasing accordingly.Losses brought by earthquake and catastrophe events are inestimable,so insurance needs to be urgently needed.Therefore,this paper focuses on earthquake risk regionalization and the pricing of earthquake catastrophe reinsurance,and carries out research through literature analysis,empirical analysis,random simulation and other methods.Under the background of vigorously promoting earthquake insurance pilot work,it not only provides a reference for catastrophe risk management and actuarial development,but also has certain significance for the promotion of the pilot work.This paper first discusses the research background and significance of catastrophe reinsurance,further determines the research direction of this paper by comparing the research results of domestic and foreign scholars,and then focuses on the reinsurance mode of catastrophe reinsurance,and selects accident overloss reinsurance for this study.Then through comparative analysis of pricing methods,it is concluded that the Pareto determination method is the most suitable pricing method for this paper.The next step is to introduce the reinsurance design scheme based on the hierarchical thought,which leads to the insurance object of this paper--economic loss and human casualties,and further demonstrates the feasibility of the method selection in this paper and the necessity of research according to the actual situation of the earthquake insurance pilot.Due to the huge geographical area of China and the obvious differences in earthquake risk between different regions,in order to make the rationality of the final result,this paper evaluates the earthquake risk and vulnerability from two aspects,takes the area with intensity of more than 8 degrees in each region as the risk measurement standard,and subdivides the economy,population and society into ten indicators,and uses the principal component analysis method for vulnerability assessment.Finally,the classification of earthquake risk levels in each region is obtained.Next,through theoretical introduction,two pricing models in this paper are introduced: POT model and Copula function.According to their theorems and properties,the reasons for choosing these two models are explained,and the research steps are analyzed to prepare for the empirical research of pricing.In this paper,historical data with earthquake magnitude greater than 5 and loss amount greater than 10 million were collected from 1980 to 2019 as the research data of this paper,which were substituted into the model for empirical study.Reinsurance premium pricing was obtained through Monte Carlo simulation,and then price dynamic analysis was conducted to compare the main factors affecting price changes.The differential rate is set up according to the result of seismic risk zoning.Finally,some suggestions are put forward based on the analysis of the results.It is suggested that differential rates should be set for earthquake catastrophe insurance products,and the country should actively promote the pilot work and promote the development of earthquake catastrophe financial derivatives.