Technical Efficiency and Super-efficiency of the Insurance Sector in Slovakia

Emília Zimková
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Emília Zimková: Department of Finance and Accounting, Faculty of Economics, Matej Bel University in Banská Bystrica, Národná 12, 974 01 Banská Bystrica, Slovak Republic

Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, 2015, vol. 63, issue 6, 2205-2211

Abstract: In this paper, the technical efficiency and the super-efficiency of a representative sample of insurance institutions in Slovakia is analyzed with the aid of data envelopment analysis (DEA). This paper differs from the so far published literature, as it extends the application of radial DEA models (the CCR model of Charnes, Cooper and Rodes; the BCC model of Banker, Charnes and Cooper) by a non-radial model (the SBM model of Tone) and a super-efficiency model. The supper-efficiency can be used either to rank efficient units or to indicate outliers in the analyzed group of decision making units. Achieved results also reveal that in the year 2013, among 13 Slovak insurance companies under evaluation, the AXA poisťovňa, a. s. was the super-efficient insurance company. The implications of gained results are then drawn for managerial and regulatory purposes. Firstly, it is shown how the management of the insurance institutions with the poorest performances should change their managerial procedures and adopt enhanced-incentive policy. Secondly, the regulatory body of the insurance institutions should utilize the gained technical efficiency of the analyzed institutions for the prediction of their competitiveness in the long run.

Keywords: insurance; DEA; SBM model; super-efficiency model (search for similar items in EconPapers)
Date: 2015
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Persistent link: https://EconPapers.repec.org/RePEc:mup:actaun:actaun_2015063062205

DOI: 10.11118/actaun201563062205

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