Non-Life Insurance Economic Performances: An Empirical Investigation

Journal of Economics and Management, 18, 2014

Posted: 1 Feb 2015

See all articles by Ornella Moro

Ornella Moro

Università degli Studi di Sassari - Department of Economics and Business

Luisa Anderloni

University of Milan - DEAS

Date Written: 2014

Abstract

The purpose of this paper is to provide new empirical evidence on the determinants of economic performances in the insurance industry. To this end, we test the impact of several firm characteristics, such as dimension, capital structure and investment policies on economic performance for a panel of non-life insurance firms operating in the main European markets spanning from 2004 to 2012. Empirical findings suggest that various factors contribute to the performance measured by return on equity and return on asset and, additionally, the insurance specific characteristics interact with country institutional features in determining profitability. In particular, the profitability of equity appears to be strongly linked to the profitability of assets, which is therefore investigated separately. The three main areas that constitute the core insurance activity (insurance in its narrower sense, financial and reinsurance activities) strongly influence profitability, but reinsurance does not seem to contribute either positively or negatively to performance. Further investigations are needed and welcome, therefore, to better understand the dynamics of performance and shed additional insight on the insurance industry.

Suggested Citation

Moro, Ornella and Anderloni, Luisa, Non-Life Insurance Economic Performances: An Empirical Investigation (2014). Journal of Economics and Management, 18, 2014, Available at SSRN: https://ssrn.com/abstract=2558065

Ornella Moro

Università degli Studi di Sassari - Department of Economics and Business ( email )

via Muroni 25
Sassari, Sassari 07100
Italy

Luisa Anderloni (Contact Author)

University of Milan - DEAS ( email )

Via Conservatorio, 7
Milan, 20122
Italy
+390250321546 (Phone)
+390250321505 (Fax)

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