Financial Risk in Insurance

When "Financial Risk in Insurance" appeared in 1995, we would not have imag- ined that this text would find such a wide readership. After all actuarial col- leagues had received the text automatically through their subscription to the 1993 AFIR colloquium in Rome. So the demand must have come from outside of our own professional circles, we believe from researchers and practitioners in finance. Both in 1996 and 1997 further copies needed to be printed. We therefore applaud the initiative by Springer to make this text available in the form of a soft-cover edition. We hope that this new edition will further contribute to the very fruitful dialogue between actuaries and professionals in finance and will be helpful in the cultural thought process bringing the world of banking and insurance closer to each other. Zurich, 1 June, 1999 In the name of the authors Hans Buhlmann Preface The Istituto Nazionale delle Assicurazioni (INA), a leading company on the Ital- ian life insurance market for over eighty years, takes special pleasure in sponsor- ing this scientific volume meant for the large international community of those concerned with insurance and finance. Our involvement in this initiative is directly connected with the awareness that the domain of insurance, in particular with respect to the management of long-term insurance savings, is changing. This enlargement, emphatically notice- able in the area of life insurance and pension funding, is extending to cover also the "interest rate risk" .