Book review : Making a Market for Acts of God : The Practice of Risk Trading in the Global Reinsurance Industry

Insurance plays a pivotal role within societies and economies and represents the longest established form of systematic risk management in modern capitalist systems. If insurance is the ‘backbone of risk management’ (e.g. Salman, 2015), then insurance’s backbone is, in turn, reinsurance, which insures insurers. Astonishingly, though, despite recent and fruitful developments in economic sociology and social studies of finance, reinsurance remains under-researched. Jarzabkowski, Bednarek and Spee have begun to fill this gap by systematically opening up the rather closed and guarded world of the trading of reinsurance risk. Making a Market for Acts of God describes and explains this financial market as the key space for financially hedging against the ‘unknown unknowns’, large-scale catastrophes of both human-made and natural kind, recurrently exceeding the US$1 billion range of financial losses. In contrast to other financial markets, reinsurance does not hinge on a single technical device or a regulatory or normative framework pre-defining most of the activities. And yet, concrete collective practices are identified by the authors, which are constituted through interconnected everyday practices of (predominantly) reinsurance underwriters, the professionals crafting reinsurance deals with insurance companies. This book is the outcome of an impressive 3-year-long, global ethnographic study including extensive participatory fieldwork and nearly 400 interviews. Drawing on these rich data, it frames markets as reciprocally constituting, and constituted by, practices and relations between actors through a social practice-theory lens