Premium Calculation without Arbitrage? - A Note on a Contribution by G. Venter

Stimulated by a recent contribution by G. Venter in this journal the adequateness of (re-)insurance premium calculation based on the hypothesis of arbitrage free (re-)insurance markets is questioned. It is argued that--in contrast to the theory of financial markets--it is not reasonable to demand that insurance markets are arbitrage free. In addition the adjusted distribution principles put forward by Venter are claimed to be invalid. KEYWORDS Premium calculation; no-arbitrage condition; financial insurance pricing.