Bonds issued by primary insurers which serve to securitize major risks for placement directly on the capital market. The securities offer investors a return depending on the insurance event. Following the Islamic terrorist attacks of September 11, 2001, terror securities were considered on several occasions, as reinsurers ruled out terror coverage as a result of this incident and terror risks thus became uninsurable. – The expectation of a further increase in Islamistic acts of terror prevails worldwide. This is because a number of influential professors of the Koran regard terror as a permissible, even God-well pleasing act for the purpose of converting the world to Islam. Therefore, such bonds are likely to find only limited buyers. As private placements, however, terror papers are already the subject of transactions in the telephone trade. – See steam room, dingo stocks, explorer stocks, secret tip, glamour stocks, go-go funds, catastrophe bonds, over-the-counter trading, risk-return principle, risk funds, risk capital, single hedge fund, XXXinsurance-linked securities, terror shocks, insurance special purpose vehicle, weather derivative, tremor premium.
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University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.
Professor Dr. Eckehard Krah, Dipl.rer.pol.
E-mail address: info@ekrah.com
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