A Study on the Financial Strength of General Insurers Jeong, Jung-Young; Yoo, Sang-Hee;
The purpose of this paper is to assess the financial strength of general insurers by using A.M. Best`s rating technique focusing on quantitative standards. A quantitative evaluation of fifteen larger general insurers` financial strength and operating performance relative to the Best`s top group is carried out. The quantitative evaluation is done in 5 key areas; growth, efficiency, profitability, safety and liquidity. The results show that there is a big gap between domestic large insurers and American insures in all areas except stable growth of operations. Therefore, domestic insurers have to strive to strengthen financial soundness through profitability and should increase the capacity to retain more commercial business and reinsurance in order to become global players.
General insurance;financial strength;A.M. Best rating;factor analysis;