DENSITY AND PENETRATION INSURANCE ON ACCIDENT & HEALTH PREMIUMS IN FUTURE IMPLEMENTATION OF SOLVENCY II – EMPIRICAL STUDY

Abstract

The purpose of this paper is to present an empirical study regarding density and penetrat ion on accident & health premiums. At the beginning, we have presented the motivations of this research, highlighting and explaining the specific factors which influence the density and insurance penetration. Implementation of Solvency Directive at European level, in the field of insurance is through specific consequences. The changes made to accounting legislation at national, European and international level, with consequences on specific information presented in the financial statements of insurance companies, was another reason of our research. The appearance of the IFRS 4 "Insurance contracts", followed by its evolution phases allowed the creation of XBRL's in as the international standard of publication, exchange and financial analysis of data reported . Also, we cannot forget that the legislative changes in accounting have interesting consequences on economic risk management specific to this field, in terms of huge efforts from national and European supervisory authorities to control and prevent the ban kruptcy of its firms. For planning and implementation of supervisors’ measures, the important tasks were established by the quantitative impact studies, the stress tests and the analyses of different scenarios, all performed in insurance companies. Thus, w e conduct an analysis on a sample of 32 countries and a horizon of 10 years (2004 -2013), being tested 2 linear regression models. The results will confirm the link between level of economic development and accident & health insurance activity, but exclude the relationship between penetration factor and this type of insurance

Keywords

• Insurance
• Accounting
• Time-series models
• Government expenditures and health
• Financial risk and risk management