On solvency and risk models

Document description

A comprehensive research project was recently completed in Finland concerning the solvency conditions of insurers in general, and some related problems such as the dimensioning of the fluctuation buffer (equalization reserve) in particular. Empirical data and experience were collected and the risks jeopardizing insurers were analysed making use of a specially constructed model. The resulting research report comprising two volumes is now published in an English-language version and will be offered as a discussion contribution to the colloquium subject: the generalised risk models. In this paper some of the background factors concerning modelling and its applications will be discussed making references to detailed considerations in the report. The solvency report (briefly SR) will be frequently referred to in the following text giving the volume (I or II) and chapter, section, subsection, and item e.g. I.2 or II.3.1 or II.3.1.14.1. References to pertinent books and publications indicate the reference lists at the end of both volumes.