Homeowners’ insurance, a $15 trillion market by coverage, provides households financial protection from climate losses …. Insurance premiums (rates) are subject to significant regulations at a state level in the United States. Using novel data on … provide evidence of decoupling of insurance rates from their underlying risks and identify regulation as a driving force …

following a rating downgrade. Reflective of fire-sale risk, clustering of insurance companies in a bond has significant …Insurance companies often follow highly correlated investment strategies. As major investors in corporate bonds, their … investment commonalities subject investors to fire-sale risk when regulatory restrictions prompt widespread divestment of a bond …

regulatory capital twice as large as the bank that sets the lowest LGDs. We argue that these differences in risk parameters … large U.S. banks assign to syndicated loans for regulatory capital purposes. Using internal bank data on loans that had PDs … and LGDs assigned by more than one bank, we find substantial dispersion in these parameters. Banks differ substantially in …

volatility risk. While pointing out the joint pricing kernel is not identified nonparametrically, we propose model-free estimates …

estimate "macro risk factors" that drive "bad" (negatively skewed) and "good" (positively skewed) variation for supply and … significantly contribute to the variation yields, risk premiums and return variances for nominal bonds. While overall bond risk … premiums are counter-cyclical, an increase in demand variance lowers risk premiums …

-pricing formula applies to far-out-of-the money put options on the stock market when disaster risk dominates, the size distribution of …