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Nematrian Reference Library

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ReferenceTitleLink
Milken Institute (2008)Catastrophe Bonds: Using the Capital Markets to Create Risk Protectionhere

Asummary (slides)

"Catastrophe bonds first appeared on the radar screens in the early 1990s, after Hurricane Andrew left insurers footing a bill for more than $23 billion in damages. A number of insurers went bankrupt, and alarms sounded across the industry worldwide. The accelerating pace of climate change may trigger weather systems that strike more frequently and with greater intensity, and explosive population growth in coastal areas spells greater exposure to natural disaster. The current market volume of catastrophe bonds exceeds $15 billion, but more issuance is needed to protect individuals, communities and companies from disaster. How can existing capital market solutions for catastrophic risk be improved to provide greater global risk protection? What products would attract a more diversified investor base and increase the available capital? How can we develop strong public-private partnerships to address catastrophic risk management?"


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