Efficiency Of Insurance Firms With Endogenous Risk Management And Financial Intermediation Activities
- Topics:
- Efficiency,
- Risk Analysis and Management
- Tags:
- Business Operations,
- Security,
- Risk Management,
- Management,
- Insurance Company,
- Insurance,
- HEC Montreal,
- Financial Services,
- Financial Planning,
- Financial Accounting,
- ...
- Source:
- HEC Montreal
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Overview: Risk management is now present in many economic sectors. This paper investigates the role of risk management in creating value for financial institutions by analyzing U.S. property-liability insurers. Property-liability insurers are financial intermediaries whose primary role in the economy is risk pooling and risk bearing. The risk pooling and risk bearing functions performed by insurers are the primary determinants of the need for risk management. The main goal of this paper is to test how risk management and financial intermediation activities create value for insurers by enhancing economic efficiency. Insurer cost efficiency is measured relative to an econometric cost frontier.
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Format: PDF | Size: 234KB | Date: Apr 2006 | Pages: 43
