The Effects of Organizational Form on Capital Structure: The Case of Stock and Mutual Property-Liability Insurance Firms

1991 ◽  
pp. 165-182 ◽  
Author(s):  
Prabir Datta ◽  
Neil A. Doherty
Keyword(s):  
Capital Structure ◽  
Organizational Form ◽  
Liability Insurance ◽  
Insurance Firms

scholarly journals Cost stickiness and the firm’s organizational form: evidence from the property-liability insurance sector

2021 ◽  
Author(s):  
Timo Gores ◽  
Jannes Rauch
Keyword(s):  
Organizational Form ◽  
Liability Insurance ◽  
Percentage Increase ◽  
Administrative Costs ◽  
Insurance Sector ◽  
Percentage Decrease ◽  
Cost Behavior ◽  
Insurance Firms ◽  
Premium Income ◽  
Cost Stickiness

AbstractWe examine the existence of cost stickiness in the German property-liability insurance sector by analyzing if the percentage increase in administrative costs for a rise in premiums is larger than the percentage decrease in administrative costs for an equivalent drop in premiums. In addition, we analyze if sticky cost behavior depends on insurance firms’ organizational form. Using company-level data from German property-liability insurance firms for the years 2001–2017 and regression analyses, we find that administrative costs are sticky in the insurance sector, as administrative costs increase on average 0.82% per 1% increase in premiums but decrease only 0.6% per 1% decrease in premium income. Moreover, we find that stock insurers exhibit lower levels of cost stickiness, indicating better monitoring mechanisms.

scholarly journals conceptual review of capital structure under risk-based capital regime, risk profile of insurer’s and performance

2021 ◽  
Vol 8 (1) ◽  
pp. 15-27
Author(s):  
Sarfaraz Ahmed Bhutto ◽  
Ikhtiar Ali Ghumro ◽  
Zulfiqar Ali Rajper ◽  
Saifullah Shaikh
Keyword(s):  
Capital Structure ◽  
Conceptual Framework ◽  
Risk Profile ◽  
Future Research ◽  
Risk Propensity ◽  
Holistic Understanding ◽  
Equity Ratio ◽  
Insurance Firms ◽  
And Performance ◽  
Corporate Risk

This paper evaluates capital structure under risk-based capital regime from the perspective of insurance firms and its performance. It also evaluates the moderating effect of insurer’s risk profile on capital-performance relationship. The authors aim to reveal ambiguities, gaps and omissions in the literature and to sketch avenues for future research. A conceptual framework for capital structure under risk-based capital era and its application is suggested focusing on equity, technical provision and required risk propensity for maximizing profit and wealth for all stakeholders. The research reviews that capital structure of insurers differs from non-insurance firms as such risk-based capital regulation must not only focus on the various types of risk but also recognized these differences. It is shown that insurers’ capital structure contains equity and technical provisions which comprises accruals and creditors, payable claims and insurance funds as an alternative of equity and financial debt as it is with conventional non insurance firms. This study thus stressed that for capital structure to best explain performance of insurers, it must be measured by equity ratio and technical provision ratio in place of debt ratio and corporate risk profile (quantitative and qualitative) must enter its sequence of performance relational analysis and effectiveness equations. We stressed further that only with the proposed conceptual framework would a holistic understanding of insurer’s capital structure be achieved while the observed contradictory and inconclusive empirical findings on capital structure and firm performance could be resolved.

Master Limited Partnership Research in Accounting, Economics, and Finance

2021 ◽  
Author(s):  
Aaron Mandell
Keyword(s):  
Capital Structure ◽  
Payout Policy ◽  
Organizational Form ◽  
Future Research ◽  
Limited Partnership ◽  
Partnership Research ◽  
Limited Partnerships

I review the research on master limited partnerships (“MLPs”) in the accounting, economics, and finance literature. I begin by outlining the scope of the review and providing a brief background on the structure, taxation, and governance of master limited partnerships. Next, I describe the various sources from which MLP data is derived. I then review the research, aggregating it into four broad categories: (1) taxes and organizational form; (2) taxes, capital structure, and payout policy; (3) valuation; and (4) governance research. Within each section, I present possible avenues for future research in accounting, economics, and finance.

scholarly journals Effect of Capital Structure on the Profitability of Listed Insurance Firms in Nigeria

2019 ◽  
pp. 36-45
Keyword(s):  
Capital Structure ◽  
Least Square ◽  
Short Term ◽  
Financial Reports ◽  
Ordinary Least Square ◽  
Least Square Regression ◽  
Multiple Regression Technique ◽  
Insurance Firms ◽  
Ordinary Least Square Regression

This study examined the effect of capital structure on profitability of listed insurance firms in Nigeria for the period 2013-2017 The study used correlation research design. The source of data which were collected from the published annual financial reports of studies listed insurance firms in Nigeria. The population of the study comprised of the 28 listed insurance firms. The sample size was fifteen (15) listed insurance firms in Nigeria. The data collected were analyzed with the aid of OLS multiple regression technique. Using 75 firm-year paneled observations, the result of the ordinary least square regression showed that short-term debt has a negative and significant effect on the profitability of listed insurance firms in Nigeria. In addition, long-term debt has a positive and significant effect on profitability. Finally, premium growth has positively significant effect on profitability of listed insurance firms. Based on the findings, the study recommends that the management of listed insurance firms should strive towards having optimum capital structure by increasing their equity level and reducing dependence on debts so as to avoid being cash strapped and debt ridden.

Effect of Capital Structure on the Profitability of Listed Insurance Firms in Nigeria

2019 ◽  
Vol 1 (2) ◽  
pp. 36-45
Author(s):  
Abdul Kerim ◽  
John Alaji ◽  
Idachaba Odekina Innocent
Keyword(s):  
Capital Structure ◽  
Jel Classification ◽  
Least Square ◽  
Short Term ◽  
Financial Reports ◽  
Ordinary Least Square ◽  
Multiple Regression Technique ◽  
Insurance Firms ◽  
Ordinary Least Square Regression

This study examined the effect of capital structure on profitability of listed insurance firms in Nigeria for the period 2013-2017 The study used correlation research design. The source of data which were collected from the published annual financial reports of studies listed insurance firms in Nigeria. The population of the study comprised of the 28 listed insurance firms. The sample size was fifteen (15) listed insurance firms in Nigeria. The data collected were analyzed with the aid of OLS multiple regression technique. Using 75 firm-year paneled observations, the result of the ordinary least square regression showed that short-term debt has a negative and significant effect on the profitability of listed insurance firms in Nigeria. In addition, long-term debt has a positive and significant effect on profitability. Finally, premium growth has positively significant effect on profitability of listed insurance firms.  Based on the findings, the study recommends that the management of listed insurance firms should strive towards having optimum capital structure by increasing their equity level and reducing dependence on debts so as to avoid being cash strapped and debt ridden. JEL classification: C88, G22, G24, G29

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