Corporate Management of Highly Dynamic Risks

Evidence from the Demand for Terrorism Insurance in Germany

verfasst von

Christian Thomann, Razvan Pascalau, J. Matthias Graf Von Der Schulenburg

Abstract

This paper investigates a corporation's risk management response to highly dynamic risks. Using a unique data set on the German terrorist insurance market, the paper tests whether corporate risk managers have a clear understanding of the probability distribution of highly dynamic risks or if risk managers learn from severe losses and base their decisions upon day-to-day experience. The paper further investigates whether risk managers become more confident in their risk management decisions over time. For this purpose, we apply Viscusi's prospective reference theory to a corporate context. We find that firms learn from single events when making their risk management decisions, and that risk managers become more confident with their risk management decisions over time.

Organisationseinheit(en)

Institut für Versicherungsbetriebslehre

Externe Organisation(en)

Ministry of Finance (Sweden)
SUNY Plattsburgh

Typ

Artikel

Journal

GENEVA Risk and Insurance Review

Band

37

Seiten

57-82

Anzahl der Seiten

26

ISSN

1554-964X

Publikationsdatum

03.2012

Publikationsstatus

Veröffentlicht

Peer-reviewed

Ja

ASJC Scopus Sachgebiete

Bilanzierung, Betriebswirtschaft, Management und Rechnungswesen (sonstige), Finanzwesen, Volkswirtschaftslehre und Ökonometrie

Ziele für nachhaltige Entwicklung

SDG 16 – Frieden, Gerechtigkeit und starke Institutionen

Elektronische Version(en)

https://doi.org/10.1057/grir.2011.3 (Zugang: Offen)