Keywords
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Swiss Re Cat Bond indices
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Abstract
The large increase in insured losses derived from the occurrence of natural catastrophes has caused the insufficiency of traditional reinsurance coverage in the insurance market. This has led to the search for new alternative forms of risk transfer through the capital markets. One of the most widely used and developed forms of securitization to date has been the issuance of catastrophe bonds or CAT Bonds. This paper presents the advantages of diversification, the attractive yields offered by these catastrophe bonds, as well as how to calculate them through the Swiss Re Cat Bond indices.
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