Design and Pricing of Wenzhou Geological Disaster Risk Bond

Meijia Zhang

doi:10.54097/fbem.v9i1.8587

Authors

Meijia Zhang

DOI:

https://doi.org/10.54097/fbem.v9i1.8587

Keywords:

Geological disaster bond, Risk securitization, Scheme design, Operational mechanism.

Abstract

In this paper, the direct economic losses of geological disasters in Wenzhou from 2007 to 2021 are taken as the sample data, and according to the distribution characteristics of geological disasters, considering the moral hazard, the yield and price of geological disaster bonds are calculated by using capital asset pricing model (CAPM) and bond pricing principle, so as to carry out the preliminary design of geological disaster risk bonds. Finally, based on China's market environment, this paper puts forward some suggestions on how to promote the securitization mechanism of catastrophe insurance and improve the catastrophe insurance market.

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