| When Insurers Go Bust: An Economic Analysis of the Role and Design of Prudential Regulation Contributor(s): Plantin, Guillaume (Author), Rochet, Jean-Charles (Author), Shin, Hyun Song (Foreword by) |
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ISBN: 0691129355 ISBN-13: 9780691129358 Publisher: Princeton University Press OUR PRICE: $65.34 Product Type: Hardcover - Other Formats Published: February 2007 Annotation: "This book provides a rare economic analysis of the regulation of the insurance industry from two authoritative authors. The book is timely and well researched, and it brings together the current state of the art in economic analysis with a thorough understanding of the institutions. It will become essential reading for anyone interested in this important policy area."--Hyun Song Shin, Princeton University "This is an important contribution because it goes beyond and strongly criticizes the literature and preconceptions of the regulatory and insurance industries. Beyond readers in the specific field, it will be useful to readers interested in regulation more generally and to readers in finance and banking. I have seen no other book like this. It is most welcome."--Philip Booth, Cass Business School, London |
| Additional Information |
| BISAC Categories: - Business & Economics | Economics - Theory - Business & Economics | Insurance - Risk Assessment & Management - Business & Economics | Finance - General |
| Dewey: 368.941 |
| LCCN: 2006936336 |
| Physical Information: 0.59" H x 5.73" W x 8.76" (0.61 lbs) 112 pages |
| Descriptions, Reviews, Etc. |
| Publisher Description: In the 1990s, large insurance companies failed in virtually every major market, prompting a fierce and ongoing debate about how to better protect policyholders. Drawing lessons from the failures of four insurance companies, When Insurers Go Bust dramatically advances this debate by arguing that the current approach to insurance regulation should be replaced with mechanisms that replicate the governance of non-financial firms. Rather than immediately addressing the minutiae of supervision, Guillaume Plantin and Jean-Charles Rochet first identify a fundamental economic rationale for supervising the solvency of insurance companies: policyholders are the bankers of insurance companies. But because policyholders are too dispersed to effectively monitor insurers, it might be efficient to delegate monitoring to an institution--a prudential authority. Applying recent developments in corporate finance theory and the economic theory of organizations, the authors describe in practical terms how such authorities could be created and given the incentives to behave exactly like bankers behave toward borrowers, as tough claimholders. |