The Effects of Insurance Company Mergers on Risk: A Note
Journal Of Business And Economic Perspectives, Vol. 19, Fall/Winter 1993
Posted: 27 Mar 1999
Insurance company risk is assessed after their acquisitions. An acquisition may increase risk if it is a strategic mismatch, or an acquisition may reduce risk through cash flow diversification. Over thirty-six month periods surrounding insurance company acquisitions, systematic risk changes are examined. Results of this study suggest that no significant shifts in risk are likely to occur, which implies that acquisitions ought not to be pursued for the sole purpose of risk reduction. Instead, acquisitions should be driven by other potential benefits.
Note: This is a description of the paper and is not the actual abstract.
JEL Classification: G00, G10, G20, G22, G30, G31,G34
Suggested Citation: Suggested Citation