An Analysis of State Guaranty Fund Assessments for Property/Casualty Insurers from 1979-90.

UNCG Author/Contributor (non-UNCG co-authors, if there are any, appear on document)
Daniel T. Winkler, Professor (Creator)
Joseph E. Johnson, Professor Emeritus (Contributor)
The University of North Carolina at Greensboro (UNCG )
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Abstract: This study analyzes features of property and liability insurance guaranty funds and net assessments on a state-by-state basis over the 12-year period ending in 1990. Previous research has looked at individual company risk factors in predicting insolvency (and resulting guaranty fund assessments). Others have determined risk-based assessment premiums based on insurer characteristics to be used by guaranty funds. This paper examines macroeconomic and industry factors that explain net assessments by state guaranty funds. Macro-level factors considered in explaining net assessments are statewide direct written premiums, catastrophes, the market share of leading insurers in the state, interest rate changes, and the market impact of large insurer insolvencies in each state. The findings suggest funding advantages for large guaranty funds for catastrophes and that the net assessments of larger guaranty funds are more adversely affected by interest rate changes.

Additional Information

Journal of Insurance Regulation, vol. 12, no. 3, Spring 1994, pp. 341-367
Language: English
Date: 1994
Property and liability insurance guaranty funds, Net assessments, State guaranty funds

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