Determinants of Financial Performance of Insurance Companies of USA and UK during Global Financial Crisis (2007-2016)
Детерминанты финансовых показателей страховых компаний США и Великобритании в период мирового финансового кризиса (2007–2016 гг.)
2019-01-01
SCID: 54.1/bachd99m
Discuss with AI
financial performanceglobal financial crisisinsurance companiespanel data techniquesreturn on assets
Figures from the paper
Abstract (AI)
The economy as well as insurance industry of USA and UK face decline during last decade. The researcher compares two insurance industries, analysis possible determinants of financial performance during global financial crisis, collected 24 insurance companies’ Quarterly data from 2007-16 and applied panel data techniques. Explanatory variables based on internal (Size of firm, liquidity, leverage and asset turnover) and external factors (GDP (Gross Domestic Product), CPI (Cost per Impression), interest rate and WTI (West Texas Intermediate)). Dependent variable: ROA (Return on Assets) and ROE (Return on Equity) (profitability indicators). This study concludes; In USA size of firm, liquidity, leverage, asset turnover, GDP and WTI have positive while CPI and interest rate have negative significant impact. In UK size of firm, liquidity, GDP, CPI and WTI have positive but leverage, asset turnover and interest rate has negative significant impact; US insurance is efficient as compare to UK. These findings will be helpful for insurance industries, government, policymakers and investors in taking decision and improving the performance.
Key Findings
1
Financial performance is measured using return on assets (ROA) and return on equity (ROE), with firm-specific and macroeconomic determinants examined.
2
In the United Kingdom, firm size, liquidity, GDP, CPI, and WTI positively and significantly affect performance, whereas leverage, asset turnover, and interest rates have negative effects.
3
In the United States, firm size, liquidity, leverage, asset turnover, GDP, and WTI positively and significantly affect performance, while CPI and interest rates affect it negatively.
4
The study analyzes quarterly panel data from 24 U.S. and U.K. insurance companies covering 2007–2016 during the global financial crisis.
5
U.S. insurance companies are found to be more efficient than U.K. insurance companies during the analyzed period.
Research Object
Insurance companies and insurance industries of the USA and UK during the global financial crisis (2007–2016)
Research Subject
Determinants and comparative analysis of financial performance and profitability, measured by ROA and ROE, including the effects of firm-specific and macroeconomic factors
Publication Details
Publication Date
2019-01-01
Journal
Publisher
ISSN
Open access PDF
Access Type
Author Information
Download PDF
Subscribe to digest