Peer Effects in Directors’ and Officers’ Liability Insurance: Evidence from China

Yuanyuan Hu and Jiali Fang

Finance Research Letters, 2022, vol. 47, issue PB

Abstract: This study finds the purchase of liability insurance for a firm's directors and officers (D&Os) is positively influenced by whether its peer firm purchases such insurance. Firms are considered to be peers if their executives are university alumni. Despite the fact that China has the second largest insurance industry in the world, D&O insurance coverage in Chinese listed firms is relatively low. Our study hence suggests an important new determinant of D&O insurance purchases in China (i.e., executive social ties).

Keywords: alumni effect; peer influence; D&O insurance; social connection; China (search for similar items in EconPapers)
JEL-codes: G30 G41 M20 M41 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:47:y:2022:i:pb:s154461232200054x

DOI: 10.1016/j.frl.2022.102731

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