Catastrophic Losses and Insurer Profitability: Evidence From 9/11

Xuanjuan Chen, Helen Doerpinghaus, Bing‐Xuan Lin and Tong Yu

Journal of Risk & Insurance, 2008, vol. 75, issue 1, 39-62

Abstract: We examine the effects of 9/11 on the insurance industry, hypothesizing a short‐run claim effect, resulting from insufficient premium ex ante for catastrophic losses, and a long‐run growth effect, resulting from ex post insurance supply reductions and risk updating. Following Yoon and Starks (1995) we use short‐ and long‐run abnormal forecast revisions to measure both effects, analyzing them as a function of firm‐specific characteristics. We find that firm type, loss estimates, reinsurance use, and tax position are important determinants of the short‐run position. Firm type, loss estimates, financial strength, underwriting risk, and reinsurance are key determinants of the firm's long‐run position.

Date: 2008
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

Downloads: (external link)
https://doi.org/10.1111/j.1539-6975.2007.00247.x

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:jrinsu:v:75:y:2008:i:1:p:39-62

Ordering information: This journal article can be ordered from
http://www.wiley.com/bw/subs.asp?ref=0022-4367

Access Statistics for this article

Journal of Risk & Insurance is currently edited by Joan T. Schmit

More articles in Journal of Risk & Insurance from The American Risk and Insurance Association Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().