Regulating the Business of Insurance: Federalism in an Age of Difficult Risk

Abstract:     
Although the United States has not established a much-needed and increasingly discussed national catastrophe policy, most significant points in current risk management strategies involve significant federal coordination and control. The authors suggest that a regulatory model that defers to the states with respect to the regulation of the insurance aspects of difficult risks is no longer viable, and an enhanced federal role in insurance regulation specifically -- and in risk management more generally -- is both necessary and appropriate with respect to difficult risks.

Number of Pages in PDF File: 44

Keywords: insurance, risk, loss, catastrophic loss, catastrophes, hurricanes, Hurricane Katrina, difficult risks, risk-management, risk allocation, risk distribution, regulation, federal regulation

JEL Classification: K00, K39

Accepted Paper Series