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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Two Essays on Property-Liability Insurer Rating Transitions
TL;DR: In this paper, the authors examined property-liability insurer rating transitions for the period 1995 through 2006 and found that the intensities of insurer rating transition, including upgrade and downgrade, are linked to macroeconomic and market covariates.
Journal ArticleDOI
Demographic Factors and Price Distortions in Insurance
TL;DR: In this article, the authors used census tract data and rating factors to examine age, income, and race demographics in an effort to determine if any subgroups of the population are adversely impacted by the price distortions of property insurance.
Essays on Insurance Economics
TL;DR: In this paper, the authors present a series of essays on insurance economics, focusing on the following topics, e.g., insurance economics and risk management.http://www.insuranceeconomics.org.
Journal ArticleDOI
The impact of internal and external reinsurance on insurers' performance and price
TL;DR: In this article, the authors investigated the impact of the use of reinsurance on the primary insurers' profitability and pricing on their insurance products, using a two stage least square to control the endogeneity problem with a reinsurance variable.
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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Price, Financial Quality, and Capital Flows in Insurance Markets
Stock Versus Mutual Ownership Structures: The Risk Implications
On the Corporate Demand for Insurance: Evidence from the Reinsurance Market
David Mayers,Clifford W. Smith +1 more