So, did the Covid 19 pandemic force multiple insurance companies into insolvency?

Also, what does new product development look like for industries like this? How does one search for new financial products? Is it possible for a non-expert to come up with new products in this space?

Are there any books you can recommend for a novice?

While Covid 19 was certainly a "Catastrophe", the market for pandemic insurance in 2020 was minuscule and to my knowledge did not cause any insurer solvency issues. There were a few cases of insurers being instructed to pay out significant claims by the courts on Business Interruption losses which the insurers argued were not covered due to existing policy exclusion.

Product development is usually highly specialized as there are a lot of nuances and frictions within the insurance industry that outsiders may not fully understand. It helps also to be in the industry and have the network with insurers, reinsurers, brokers, etc. This is not at all to suggest there isn't room for clever people to bring innovation to the market though!

Book recs are hard to specify for CAT bonds but for insurance in general:

Against the Gods: The Remarkable Story of Risk - Peter L. Bernstein

The Black Swan - Nassim Nicholas Taleb

On the Brink: How a Crisis Transformed Lloyd's of London - Andrew Duguid

The last one is a personal favourite of mine

In the end there's always someone left holding the can. Lloyd's of London has underwriters with unlimited liability. Incredibly, a lot of these Names have historically been private individuals. In the 90s a lot of these lost their shirts (and their homes) when they dicovered that it wasn;t just an easy source of passive income. https://www.theguardian.com/money/2000/nov/04/business.perso...

The impact was nuanced, and depended on the specific policies in place.

Some businesses had business interruption insurance which paid out. Many policies exclude highly correlated events such as pandemics.

And then think about specific events which were cancelled, which may have bought policies protecting them if cancelled.

And of course life insurance and health care would have been affected.

SwissRe often produces public reports in the space if of interest:

https://www.swissre.com/risk-knowledge/building-societal-res...

I don't think so. I'm pretty sure it was considered an 'act of G-d', not an act of China :)

I think you could also have specific pandemic insurance, and that paid out, but those were rare before Covid.

Why would it? I don't think that much pandemic insurance is written and obviously you model all the contracts as being very highly correlated.