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Principles of Reinsurance, 2 vols.

Principles of Reinsurance Volumes I and II, by Bernard L. Webb, Howard N. Anderson, John A. Cookman, Peter R. Kensicki, Insurance Institute of America 1990, 227 and 206 pages, respectively. Reviewer: Robert Puelz, Assistant Professor, Department of Finance, Insurance, and Real Estate, Memphis State University.

These two volumes represent the text for one of four courses in the Associate in Reinsurance (ARe) program for the Insurance Institute of America. Both volumes, however, are short on principles of reinsurance and long on principles of risk and insurance which reflects, I presume, the authors belief that readers of Principles of Reinsurance are indeed newcomers to the problem of risk and one of its solutions, insurance. For example, of volume I's seven chapters only one entitled, "Types and Structure of Reinsurance," is devoted solely to reinsurance principles. The other six chapters of volume I are condensed versions of analogous chapters in a principles of insurance text. Similarly, the six chapters of Volume II focus on company operations with a single chapter devoted to "Reinsurance Audits."

This is not to say that Principle of Reinsurance is not recommended reading. The authors' present the material in an organized format beginning with the concept of risk and insurance and ending with chapters on the financial analysis and financial security of insurance companies. The authors are good writers. Generally, high quality textbook writing is often taken for granted because the reader is led as if by the invisible pen of the writer down a hurdleless path in the presentation of the knowledge, whereas bad textbook writing is obtuse, confusing, and easy to spot. The authors' extensive past writing experience combined with the many individuals who read sections of the original manuscript has assured ease in learning their material.

In summary, the authors' devotion of only two of twelve chapters to reinsurance left this reader a bit wanting of additional information about the reinsurance business. On the other hand, readers unacquainted with insurance company operations and the usefulness of reinsurance to transfer risk, stabilize earnings, increase capacity, etc., will find Principles of Reinsurance a useful reference.
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Author:Puelz, Robert
Publication:Journal of Risk and Insurance
Article Type:Book Review
Date:Mar 1, 1991
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