TRB Pubsindex
Text Size:
x

« Prev Next »

Return to Results | New Search

Bookmark and Share

Title:

Catastrophe Bonds for Transportation Assets: Feasibility Analysis for Bridges

Accession Number:

01145379

Record Type:

Component

Availability:

Transportation Research Board Business Office

500 Fifth Street, NW
Washington, DC 20001 United States
Order URL: http://www.trb.org/Main/Blurbs/Finance...ics_and_Economic_Development_162631.aspx

Find a library where document is available


Order URL: http://worldcat.org/isbn/9780309126298

Abstract:

Recent catastrophic events such as floods and earthquakes have underlined the need for rapid infusion of financial and other resources to facilitate repair and reconstruction of damaged facilities and lifeline infrastructure. Because bridge structures are a major component of the essential transportation infrastructure, they require timely application of maintenance and repair. To mitigate risks associated with natural hazards and associated impacts on bridges, it is necessary to adopt suitable financial tools. Hazard-linked securities such as catastrophe (CAT) bonds are financial tools that have called the attention of investors as a risk-mitigating instrument that supports fast recovery of communities and businesses. The benefits of CAT bonds are twofold: the bonds ensure that financial resources are readily available to cover potential losses in the wake of a natural hazard, and they provide attractive returns with risks uncorrelated with other, more traditional financial assets, such as stocks or corporate bonds. This paper presents a model for determining the risk premium (spread) implied by the default-triggering event and structural design parameters. A risk-neutral cost–benefit method for pricing the risk premium (spread) is presented. Examples of conventionally designed and seismically designed bridges illustrate the implication of structural design parameters on the risk premium and the corresponding utility of these structures as potential CAT bond investments.

Monograph Accession #:

01145381

Report/Paper Numbers:

09-3186

Language:

English

Authors:

Sircar, Jyotirmoy
Damnjanovic, Ivan D
Mander, John B
Aslan, Veysel Zafer

Pagination:

pp 12-19

Publication Date:

2009

Serial:

Transportation Research Record: Journal of the Transportation Research Board

Issue Number: 2115
Publisher: Transportation Research Board
ISSN: 0361-1981

ISBN:

9780309126298

Media Type:

Print

Features:

Figures (5) ; References (16)

Subject Areas:

Bridges and other structures; Economics; Finance; Highways; I10: Economics and Administration; I24: Design of Bridges and Retaining Walls

Files:

TRIS, TRB, ATRI

Created Date:

Nov 30 2009 10:19AM

More Articles from this Serial Issue: