Journal ArticleDOI
The Impact of Firm Risk on Property-Liability Insurance Prices
TLDR
In this paper, the authors examined the impact of an insurer's level of insolvency risk on the prices the insurer obtains for its products in the property-liability insurance market.Abstract:
This article examines the impact of an insurer's level of insolvency risk on the prices the insurer obtains for its products in the property-liability insurance market. The measures of insolvency risk used are those implied by the option pricing model of insurance. The key finding is the existence of a negative relation between insolvency risk and insurance prices. This implies that property-liability insurers are penalized for default risk through lower prices, despite the existence of guaranty funds. Other firm-specific determinants of insurance prices are also identified. The results have significant implications for insurance researchers and regulators.read more
Citations
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Dissertation
Application of Agent Based Modeling to Insurance Cycles
TL;DR: In this article, a multi-agent system describing an insurance market is proposed to capture the complexity of the real world, and the insurance cycles are the results of these dynamic interactions of agents in such complex system.
Posted Content
Value from Hedging Risk with reinsurance
Nicos A. Scordis,Petra Steinorth +1 more
TL;DR: In this article, a positive relation between the use of reinsurance and value is found, which suggests that shareholders fully recognize the value of hedging only in the absence of noise in the firm's environment.
Posted Content
Service Quality in Private Passenger Automobile Insurance
J. Tim Query,Robert E. Hoyt +1 more
TL;DR: In this article, the authors extended previous research on service quality in the private passenger automobile insurance industry by providing empirical evidence using an improved proxy for the value of service, which was recognized and treated statistically with the two-stage least squares approach.
Posted Content
The risk-shifting behavior of insurers under different guarantee schemes
TL;DR: In this paper, the authors investigate stock insurers' risk-shifting behavior for insurance guarantee schemes under the two different financing alternatives: a flat-rate premium assessment versus a risk-based premium assessment.
Journal ArticleDOI
The Market for Directors’ and Officers’ Insurance
TL;DR: In this article, the authors used the newly available D&O Insurance Coverage Supplement (DICS) to develop a more comprehensive understanding of the DRO insurance market and of those firms that write DRO coverage.
References
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Journal ArticleDOI
Elements of Econometrics.
Ian Domowitz,Jan Kmenta +1 more
TL;DR: The Elements of Econometrics as mentioned in this paper is a textbook for upper-level undergraduate and master's degree courses and may usefully serve as a supplement for traditional Ph.D. courses in economics.
Book
Elements of econometrics
TL;DR: The emphasis is on simplification whenever possible, assuming the readers know college algebra and basic calculus, and Jan Kmenta explains all methods within the simplest framework, and generalizations are presented as logical extensions of simple cases.
Journal ArticleDOI
Contractual Provisions, Organizational Structure, and Conflict Control in Insurance Markets
David Mayers,Clifford W. Smith +1 more
TL;DR: In this article, the authors provide a foundation for a positive theory of insurance contracting with examples of its testable predictions and argue that incentive conflicts arise when discretionary action is authorized and that contractual provisions and organizational structures control sources of conflict within the insurance market.
Journal ArticleDOI
Price, Financial Quality, and Capital Flows in Insurance Markets
TL;DR: In this article, the authors developed a model of price determination in insurance markets, which predicts that the price of insurance, measured by the ratio of premiums to discounted losses, is inversely related to insurer default risk.
Journal ArticleDOI
Stock Versus Mutual Ownership Structures: The Risk Implications
TL;DR: In this paper, the authors provide empirical tests of the risk differences between two types of ownership structure in the property-liability insurance industry and provide empirical evidence that suggests stock insurers have more risk than mutuals where the risk inherent in future cash flows is proxied by the variance of the loss ratio.
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