Application of Risk Management in Mutual Insurance

Risk management provides a new approach to solve mutual insurance problem. This paper introduces risk management into mutual insurance, and proposes a new pricing method for mutual insurance with different management methods, that is to add risk insurance to basic insurance price. This method changes the insurance estimation that is the most difficult work in mutual insurance to compensation choice of everyone. It avoids the difficult and deviation of estimation. Adopted new model expression for mutual insurance and reasonable insurance articles, a decentralized decision system can be set up considering reserve mutual insurance. Also, some problems in mutual insurance are discussed in risk management view.