The Systemic Risk Assessment of China's Insurance market Based on Complex Network Theory

In this paper, we constructed a reinsurance network model according to the reinsurance relationships of insurance companies by using the minimum density method. Both static and dynamic complex network methods were used to analyze the insurance market and systemic risk. In the static analysis, we compared network metrics during and after the epidemic to evaluate the impact of the epidemic on reinsurance transactions. In the dynamic analysis, the DebtRank model was applied to calculate systemic risk, and then we simulated two sets of shocks: one on the single insurance company and the other on macroeconomics. By comparing the impact brought by different transmission channels on systemic risk, we located some systemically important insurance companies. We find that reinsurance companies, especially China Property and Casualty Reinsurance and PICC Reinsurance, are very important in systematic importance and should be paid great attention to. The theoretical reference value of the research presented in this paper provides evidence for national regulators to support their supervision of systemic risk, thus helping prevent financial crises and ensuring financial market stability.