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Stock versus Mutual Ownership Structures: The Risk Implications

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Author Info
Lamm-Tennant, Joan
Starks, Laura T
Abstract

This article provides empirical tests of the risk differences between two types of ownership structure in the property-liability insurance industry. Empirical evidence is provided that suggests stock insurers have more risk than mutuals where the risk inherent in future cash flows is proxied by the variance of the loss ratio. Further evidence suggests that stock insurers write relatively more business than do mutuals in lines and states having higher risk. Copyright 1993 by University of Chicago Press.

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File URL: http://links.jstor.org/sici?sici=0021-9398%28199301%2966%3A1%3C29%3ASVMOST%3E2.0.CO%3B2-Z&origin=repec
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Publisher Info
Article provided by University of Chicago Press in its journal Journal of Business.

Volume (Year): 66 (1993)
Issue (Month): 1 (January)
Pages: 29-46
Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Handle: RePEc:ucp:jnlbus:v:66:y:1993:i:1:p:29-46

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Postal: The University of Chicago Press, Journals Division, P.O. Box 37005 Chicago, IL 60637
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  1. J. David Cummins & Sharon Tennyson & Mary A. Weiss, 1998. "Consolidation and Efficiency in the U.S. Life Insurance Industry," Center for Financial Institutions Working Papers 98-08, Wharton School Center for Financial Institutions, University of Pennsylvania. [Downloadable!]
    Other versions:
  2. J. David Cummins & Martin F. Grace & Richard D. Phillips, 1998. "Regulatory solvency prediction in property-liability insurance: risk-based capital, audit ratios, and cash flow simulation," Working Papers 98-20, Federal Reserve Bank of Philadelphia. [Downloadable!]
  3. Hong Zou & Chuanhou Yang & Mulong Wang & Minglai Zhu, 2009. "Dividend decisions in the property and liability insurance industry: mutual versus stock companies," Review of Quantitative Finance and Accounting, Springer, vol. 33(2), pages 113-139, August. [Downloadable!] (restricted)
  4. Garven, J. R. & M. Guillen, 1995. "Ownership Structure and Distribution Systems in Property-Liability Insurance," Working Papers 009, Risk and Insurance Archive. [Downloadable!]
  5. Allen N. Berger & J. David Cummins & Mary A. Weiss, 1995. "The Coexistence of Multiple Distributions Systems for Financial Services: The Case of Property-Liability Insurance," Center for Financial Institutions Working Papers 95-13, Wharton School Center for Financial Institutions, University of Pennsylvania. [Downloadable!]
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  6. Lawrence Powell & David Sommer, 2007. "Internal Versus External Capital Markets in the Insurance Industry: The Role of Reinsurance," Journal of Financial Services Research, Springer, vol. 31(2), pages 173-188, June. [Downloadable!] (restricted)
  7. Bourlès, Renaud, 2009. "On the Emergence of Private Insurance in Presence of Mutual Agreements," MPRA Paper 5821, University Library of Munich, Germany. [Downloadable!]
  8. M. Adams & M. Buckle, 2003. "The determinants of corporate financial performance in the Bermuda insurance market," Applied Financial Economics, Taylor and Francis Journals, vol. 13(2), pages 133-143, January. [Downloadable!] (restricted)
  9. Patricia Born & William M. Gentry & W. Kip Viscusi & Richard J. Zeckhauser, 1995. "Organizational Form and Insurance Company Performance: Stocks versus Mutuals," NBER Working Papers 5246, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  10. Zélia Serrasqueiro & Paulo Maçãs Nunes, 2008. "Performance and size: empirical evidence from Portuguese SMEs," Small Business Economics, Springer, vol. 31(2), pages 195-217, August. [Downloadable!] (restricted)
  11. Gardner, L. A. & M. F. Grace, . "Efficiency Comparisons between Mutual and Stock Life Insurance Companies," Working Papers 012, Risk and Insurance Archive. [Downloadable!]
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  12. J. David Cummins & Scott E. Harrington & Robert Klein, 1995. "nsolvency Experience, Risk-Based Capital, and Prompt Corrective Action in Property-Liability Insurance," Center for Financial Institutions Working Papers 95-06, Wharton School Center for Financial Institutions, University of Pennsylvania. [Downloadable!]
  13. Javier Delgado & Vicente Salas-Fumás & Jesús Saurina, 2006. "The joint size and ownership specialization in banks' lending," Banco de España Working Papers 0606, Banco de España. [Downloadable!]
  14. Leo de Haan & Jan Kakes, 2007. "Are non-risk based capital requirements for insurance companies binding?," DNB Working Papers 145, Netherlands Central Bank, Research Department. [Downloadable!]
  15. J. Cummins & Gregory Nini, 2002. "Optimal Capital Utilization by Financial Firms: Evidence from the Property-Liability Insurance Industry," Journal of Financial Services Research, Springer, vol. 21(1), pages 15-53, February. [Downloadable!] (restricted)
  16. Steven Pottier & David Sommer, 2002. "The Effectiveness of Public and Private Sector Summary Risk Measures in Predicting Insurer Insolvencies," Journal of Financial Services Research, Springer, vol. 21(1), pages 101-116, February. [Downloadable!] (restricted)
  17. David Mayers & Clifford Smith, 2002. "Ownership Structure and Control: Property-Casualty Insurer Conversion to Stock Charter," Journal of Financial Services Research, Springer, vol. 21(1), pages 117-144, February. [Downloadable!] (restricted)
  18. Azofra Palenzuela, Valentín & Castrillo Lara, María Jesús, 2001. "Estructuras de propiedad en el sector asegurador español: evidencia empírica de su eficiencia y estrategias alternativas," Documentos de Trabajo "Nuevas Tendencias en Dirección de Empresas". Working Papers "New Trends on Business Administration". 2001-06, Interuniversitary Doctorate Program "New Trends on Business Administration", Universities of Valladolid, Burgos and Salamanca (Spain). Programa de Doctorado Interuniversitario "Nuevas Tendencias en Di. [Downloadable!]
  19. Mark J. Flannery & W. Scott Frame, 2006. "The Federal Home Loan Bank system : the "other" housing GSE," Economic Review, Federal Reserve Bank of Atlanta, issue Q 3, pages 33-54. [Downloadable!]
  20. Scott Harrington & Greg Niehaus, 2002. "Capital Structure Decisions in the Insurance Industry: Stocks versus Mutuals," Journal of Financial Services Research, Springer, vol. 21(1), pages 145-163, February. [Downloadable!] (restricted)
  21. Dennis Fan & Raymond So & Jason Yeh, 2006. "Analyst Earnings Forecasts for Publicly Traded Insurance Companies," Review of Quantitative Finance and Accounting, Springer, vol. 26(2), pages 105-136, March. [Downloadable!] (restricted)
  22. J.Cook & S.Deakin & A.Hughes, 2001. "Mutuality and Corporate Governance: The Evolution of UK Building Societies Following Deregulation," ESRC Centre for Business Research - Working Papers wp205, ESRC Centre for Business Research. [Downloadable!]
  23. Fabrice Roth, 2000. "Gouvernement des entreprises et stratégie du dirigeant:une étude clinique dans le secteur de l'assurance," Working Papers FARGO 1000701, Université de Bourgogne - Latec/Fargo (Research center in Finance,organizational ARchitecture and GOvernance). [Downloadable!]
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