Can Regulation Affect the Solvency of Insurers? New Evidence from European Insurers

Siopi, Evaggelia; Poufinas, Thomas; Chen, James Ming; Agiropoulos, Charalampos

doi:10.1007/s11294-023-09867-w

Cited by 2 publications

(1 citation statement)

References 30 publications

(23 reference statements)

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“…Additionally, the author recommends that insurance companies introduce an integrated reporting system to make solvency and financial information more understandable and comparable for all stakeholders, avoiding double costs and inconsistencies in the reporting system. Siopi et al (2023), analyzing data from 29 insurance groups operating in the European Union from 2016 to 2020, also confirmed the positive impact of the Solvency II Directive on the solvency and transparency of insurance companies in Europe.…”

Section: Literature Reviewmentioning

confidence: 53%

Insurance market transparency research trends: Bibliometric analysis

Kuzior,

Zakharkina,

Kubaščikova

et al. 2023

Insurance Markets and Companies

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Transparency is a fundamental necessity for the insurance market in the modern fast-changing and digital world. The study aims to establish, based on bibliometric analysis, the research trends and subject areas of the insurance market transparency, including the impact of digital technologies, regulatory initiatives, and the internal policies of insurance companies. A bibliometric analysis of papers published in the journals indexed by the Scopus database for the years 1988–2023 was conducted to achieve this goal. Five clusters have been identified based on the analysis of the shared use of keywords, demonstrating the multidisciplinary nature of the research subject. They cover government regulation and risk management; ethics; technological innovations in increasing transparency; transparency of prices and costs in health insurance; and state medical insurance transparency. The analysis of insurance market transparency trends has allowed identifying four key stages of development: post-crisis regulatory mechanisms (2013–2016), Solvency II regulation effectiveness (2017–2019), transparency during the pandemic (2020–2021), and the impact of digital innovations since 2021. Spatial clustering made it possible to identify five groups of countries whose representatives are co-authors of research on insurance market transparency. The leading countries in research on insurance market transparency are the USA, the UK, and Germany. AcknowledgmentThis research was funded by the Ministry of Education and Science of Ukraine (projects No. 0122U000774 “Digitalization and transparency of public, corporate and personal finance: the impact on innovation development and national security”, No. 0123U101945 “National security of Ukraine through the prevention of financial fraud and money laundering: war and post-war challenges”). This research was funded under the research subsidy of the Faculty of Organization and Management of the Silesian University of Technology in Poland for the year 2023 (13/990/BK_23/0178).

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Section: Literature Reviewmentioning

confidence: 53%

Insurance market transparency research trends: Bibliometric analysis

Kuzior,

Zakharkina,

Kubaščikova

et al. 2023

Insurance Markets and Companies

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Investment Portfolio Allocation and Insurance Solvency: New Evidence from Insurance Groups in the Era of Solvency II

Poufinas,

Siopi

2024

Risks

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This study examines the effect of the investment portfolio structure on insurers’ solvency, as measured by the Solvency Capital Requirement ratio. An empirical sample of 88 EU-based insurance groups was analyzed to provide robust evidence of the portfolio’s impact on the Solvency Capital Requirement ratio from 2016 to 2022. Linear regression and supervised machine learning models, particularly extra trees regression, were used to predict the solvency ratios, with the latter outperforming the former. The investigation was supplemented with panel data analysis. Firm-specific factors, including, unit-linked and index-linked liabilities, firm size, investments in property, collective undertakings, bonds and equities, and the ratio of government bonds to corporate bonds and country-specific factors, such as life and non-life market concentration, domestic bond market development, private debt development, household spending, banking concentration, non-performing loans, and CO2 emissions, were found to have an important effect on insurers’ solvency ratios. The novelty of this research lies in the investigation of the connection of solvency ratios with variables that prior studies have not yet explored, such as portfolio asset allocation, the life and non-life insurance market concentration, and unit-linked and index-linked products, via the employment of a battery of traditional and machine enhanced methods. Furthermore, it identifies the relation of solvency ratios with bond market development and investments in collective undertakings. Finally, it addresses the substantial solvency risks posed by the high banking sector concentration to insurers under Solvency II.

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Can Regulation Affect the Solvency of Insurers? New Evidence from European Insurers

Cited by 2 publications

References 30 publications

Insurance market transparency research trends: Bibliometric analysis

Insurance market transparency research trends: Bibliometric analysis

Investment Portfolio Allocation and Insurance Solvency: New Evidence from Insurance Groups in the Era of Solvency II

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