Loss Ratio on Insurance Equity Securities: A New Step in Insurance Securitization

Abstract

If you would like to write for this, or any other Emerald publication, then please use our Emerald for Authors service information about how to choose which publication to write for and submission guidelines are available for all. Please visit www.emeraldinsight.com/authors for more information. About Emerald www.emeraldinsight.comEmerald is a global publisher linking research and practice to the benefit of society. The company manages a portfolio of more than 290 journals and over 2,350 books and book series volumes, as well as providing an extensive range of online products and additional customer resources and services.Emerald is both COUNTER 4 and TRANSFER compliant. The organization is a partner of the Committee on Publication Ethics (COPE) and also works with Portico and the LOCKSS initiative for digital archive preservation.

Thai Non-Life Insurance Companies’ Resilience and the Historic 2011 Floods: Some Recommendations for Greater Sustainability

“…In addition, 3 performance ratios indicate how efficiently management utilises its assets and equity relative to a company's costs. The ratio of investment assets to policy liabilities (IAPL) shows the amount of the former produced with help from the latter [18,19,22,28,34,35]. It also makes use of the losses-incurred-to-earned-premiumswritten ratio to reveal periods with unexpectedly high claim payments relative to income earned from policyholders [18,19,22,28,34,35].…”

“…It indicates whether a company is collecting more premiums than the amount it pays out in claims. A company with high loss claims may experience financial difficulties [18,19,25,26,28,30,[34][35][36].…”

“…Studies employing the DE ratio to indicate insurance companies' financial stability have found that the ones with higher DE levels put their liquidity at risk [18,[21][22][23]25,27,31,34,36]. Consequently, investors, creditors, and other stakeholders rely on this ratio to analyse how well a given company would be able to fulfill its debt obligations in the event of an insured natural catastrophe or liquidation.…”

Capital market solutions to terrorism risk coverage: a feasibility study

“…In previous articles, Bouriaux (2001), and Bouriaux and Russell (2002) addressed the common factors that have limited the growth of insurance securitization: dual coincidence of wants between issuers of and investors in the securities, low secondary market liquidity and an unfavorable regulatory treatment. The following is a summary of previous discussions contained in the above-cited papers.…”

“…The securities would have to be issued in small denomination to become attractive not only to large institutional investors but also to retail investors. Bouriaux and Russell (2002) have argued that insurance-linked securities issued in small denomination and possibly traded on an established exchange (for instance, the American Stock Exchange) might attract individual investors. Terrorismlinked securities could also be marketed to the small investor as a "charity" or "war" investment and might become popular as an alternative to donations because they would have an upside yield potential if no terrorism event occurs.…”