FIRM SPECIFIC CHARACTERISTICS AND REINSURANCE – EVIDENCE FROM CROATIAN INSURANCE COMPANIES

Marijana Curak (), Marija Utrobicic and Daniel Kovac
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Marijana Curak: University of Split
Daniel Kovac: AD Plastik d.d. Solin

Economic Thought and Practice, 2014, vol. 23, issue 1, 29-42

Abstract: Reinsurance is the most important method of insurance companies’ actuarial risk management. Insurance companies’ internal factors of the reinsurance demand in the Republic of Croatia are examined in this paper. Random effects panel model was estimated by using the data about internal characteristics of 19 insurers in the period between 2006 and 2011. The results of empirical analysis show that important factors of the insurance companies’ decisions regarding the purchase of reinsurance are leverage, size, return on investment, ownership structure, as well as a share of non-life insurance in total insurance business. Underwriting result and asset volatility do not show statistically significant effect on reinsurance demand in the Croatian insurance market.

Keywords: reinsurance; insurance companies; insurers’ internal characteristics (search for similar items in EconPapers)
JEL-codes: G22 (search for similar items in EconPapers)
Date: 2014
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