Safety Production Liability Insurance and the Pricing of it

The Communist Party of China has attached great importance to the safe production work since the 18th CPC National Congress and put forward that development must not be at the expense of safety and put forward set up the system of safety production liability insurance. In this background, the text introduce the safety production liability insurance and compare it with mortgage system and injury insurance. I find that we can reduce the burden on enterprise and complement the injury insurance when we use the safety production liability insurance. However there are many irrationality in its pricing. So I make use the method of real option pricing to make sure the rate of safety production liability insurance.