Federal Reserve as Reinsurer of Last Resort via Reinsurer Premium Allocations

This white paper presents a comprehensive framework where the Federal Reserve serves as the reinsurer of last resort for the U.S. insurance market. Funding is derived from a fixed percentage allocation of insurance premiums handled by reinsurers, combined with direct reinsurer capital commitments. This approach ensures rapid liquidity during extreme loss events while minimizing the frequency and scale of public intervention.