The insurer should consider the risk exposure, the security of derivative financial commodity counterparties, the purpose of holding derivative financial commodities, and the insurer's protection against the risk exposure of derivative financial commodities (such as collateral) to evaluate the security of derivative financial commodities. In some cases, derivatives counterparties can improve security by giving insurers the right to collateral in the event of counterparty bankruptcy. Similarly, the security of investment can be improved through the guarantee provided by a third party.<br>
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