Rescue Strategy in Insurance Troubled Companies Based on Improved SIR model

• 1、Finance and Statistics School of Hunan University,Changsha 410006

Abstract：Based on the complex network theory, this paper used the financial companies\'data to construct a insurance companies\'crisis network, with insurance companies as the center and contained 100 financial companies. Then improving the SIR model by the bankrupt rate to study the Chinese insurance crisis network,and estimating its parameters by the insurance companies\' 2016~2018 risk comprehensive rating data.By simulating the contagion process of the crisis , analyzing the rescue strategy on the troubled companies. The simulation results showed that the necessary insurance market exit mechanism can shorten the crisis duration and accelerate the insurance industry to recover at a new steady state level. In the early stage of crisis contagion, the rescue strategy has the best time (one month after the crisis begins to spread) and rescue cost(20% of the total cost) ;under this best rescue strategy, the regulator should establish the troubled insurance companies\' risk isolation zone early and cut off the infection paths, which can significantly reduce the peak of the infected companies. In addition, the Insurance Guarantee Fund Company can achieve the maximum rescue effect with lower rescue costs.

Keywords： Insurance science SIR model bankrupt rate parameter estimation rescue strategy