Alternative Risk Transfer
From Wikipedia, the free encyclopedia
Alternative Risk Transfer' (often referred to as ART) is the use of techniques other than traditional insurance and reinsurance to provide risk bearing entities with coverage or protection. The field of ART grew out of a series of insurance capacity crises in the 1970's through 1990's that drove purchasers of traditional coverage to seek more robust ways to buy protection.
Most of these techniques permit investors in the capital markets to take a more direct role in providing insurance and reinsurance protection, and as such the broad field of ART is said to be bringing about a Convergence of insurance and financial markets
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[edit] Key Market Participants
Investment banks, notably Goldman Sachs across life and catastrophe sectors and Lehman Brothers in the life sector.
Reinsurers, notably Swiss Re across the life and catastrophe sectors.
Brokers including Marsh, Aon and Carvill.
[edit] Key Sectors
Key sectors of the Alternative Risk Transfer marketplace include financial reinsurance (which includes finite insurance and reinsurance), catastrophe bonds, Reinsurance Sidecars, contingent capital, captive insurers and reinsurers, dual trigger insurance, industry loss warranties, Weather derivatives
[edit] See also
- Reinsurance
- Catastrophe bonds
- Reinsurance Sidecars
- Financial reinsurance (which also covers Finite Reinsurance)
- contingent capital
- captive insurance
- Dual trigger insurance
- Industry Loss Warranties
- Life Insurance Securitization
- Weather derivatives
[edit] Sources
For extensive coverage of this space see Reactions Magazine, Benfield Quarterly, Insurance Insider. The key reference work for the space is "Alternative Risk Strategies" published by Risk magazine 2002
