Strategic Group Performance and Dynamics Under Different Economic Conditions

The Geneva Papers on Risk and Insurance - Issues and Practice 40, 47-65 (January 2015) | doi:10.1057/gpp.2014.16

Posted: 2 Sep 2015 Last revised: 30 Sep 2015

See all articles by Muhammed Altuntas

Muhammed Altuntas

University of Cologne - Department of Risk Management and Insurance

Jannes Rauch

University of Cologne

Sabine Wende

University of Cologne - Faculty of Management, Economics and Social Sciences

Date Written: August 18, 2015

Abstract

We analyse Strategic Groups in the German insurance market. We use cluster analysis to subdivide Insurance Groups into Strategic Groups. Furthermore, we analyse whether Strategic Group affiliation can affect the performance of the Insurance Groups’ property-liability subsidiaries. In addition, we examine the consequences of the financial crisis of 2008 on the competitive situation in the German insurance sector and examine whether changes in Strategic Group affiliation can be considered as a consequence of the financial crisis. Using a dataset of 829 firm year observations for the years 2004 to 2012, our results indicate the existence of three Strategic Groups in the German insurance sector. In addition, we find that performance differences on subsidiary-level can be attributed to Strategic Group affiliation. Furthermore, we do not find evidence that the financial crisis induced changes in Strategic Group affiliation.

Keywords: Strategic Groups, cluster analysis, performance, financial crisis, German insurance market

JEL Classification: G22, G32, G28

Suggested Citation

Altuntas, Muhammed and Rauch, Jannes and Wende, Sabine, Strategic Group Performance and Dynamics Under Different Economic Conditions (August 18, 2015). The Geneva Papers on Risk and Insurance - Issues and Practice 40, 47-65 (January 2015) | doi:10.1057/gpp.2014.16. Available at SSRN: https://ssrn.com/abstract=2653925 or http://dx.doi.org/10.2139/ssrn.2653925

Muhammed Altuntas

University of Cologne - Department of Risk Management and Insurance ( email )

Kerpener Str. 30
Cologne, D-50923
Germany

Jannes Rauch

University of Cologne ( email )

Albertus-Magnus-Platz
Cologne, 50923
Germany

Sabine Wende (Contact Author)

University of Cologne - Faculty of Management, Economics and Social Sciences ( email )

Albertus-Magnus-Platz
Cologne, D-50923
Germany

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