Is the Insurance Business Viable?

12 Pages Posted: 25 Feb 2016 Last revised: 25 Apr 2016

See all articles by Robert Ferguson

Robert Ferguson

AnswersToGo

Dean Leistikow

Fordham University - Finance Area

John R. Powers

Corporate Communication Resources Inc.

Date Written: June 30, 2003

Abstract

The insurance business is fraught with problems for which, in many insurance lines, a solution that is acceptable to consumers and leaves the insurance business viable is not likely. We analyze the factors that create this situation. Consumers often view economically viable premiums as too high. In these cases, the tendency of private insurers is to abandon those lines to avoid failure. Pressure then mounts for government to provide insurance at "affordable" premiums or for government to force the insurance companies to do so. The results of the availability of such affordable insurance are not in consumers' interests.

Keywords: Insurance, government regulation, stock valuation, investment analysis, insolvency, health insurance, medicare

JEL Classification: G10, G11, G12, G14

Suggested Citation

Ferguson, Robert and Leistikow, Dean and Powers, John R., Is the Insurance Business Viable? (June 30, 2003). Financial Analysts Journal, Vol. 59, No. 3, 2003; Fordham University Schools of Business Research Paper No. 2737387. Available at SSRN: https://ssrn.com/abstract=2737387

Robert Ferguson (Contact Author)

AnswersToGo ( email )

6815 Edgewater Drve
Apt 208
Coral Gables, FL FL 33133
United States
7868974573 (Phone)

Dean Leistikow

Fordham University - Finance Area ( email )

33 West 60th Street
New York, NY 10023
United States

John R. Powers

Corporate Communication Resources Inc.

Alexandria, VA
United States

Register to save articles to
your library

Register

Paper statistics

Downloads
27
Abstract Views
295
PlumX Metrics