Abstract
The focus of this note is on the transformation curve of a typical insurer between net premium and the probability of insolvency. On the basis of the suggested model two major implications are derived. First, transfers of risks will reduce the company's obligations but not necessarily its probability of insolvency. Second, the optimal ceding of risks is not necessarily unique.
| Original language | American English |
|---|---|
| Pages (from-to) | 403-409 |
| Journal | Journal of Risk and Insurance |
| Volume | 44 |
| Issue number | 3 |
| State | Published - 1977 |