The Emergence of Cross-Border Insurance Groups within Europe with Centralised Risk Management
AbstractThis paper analyses the degree of internationalisation of insurance business. Using a novel dataset of 25 large EU insurance groups, we find that the insurance industry has a strong international orientation. About 55 per cent of the business of these large insurance groups is conducted abroad. The cross-border activities are predominantly within Europe (30 to 35 per cent) and less so in the rest of the world (20 to 25 per cent). Next, this paper examines the impact of internationalisation on the organisational structure. We find a clear trend towards centralising risk and capital management activities within large insurance groups, though insurance remains at the same time a local business. Applying the hub and spoke model, we identify which functions are executed at the centre (hub) and which functions are performed at the local business units (spokes).
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Bibliographic InfoPaper provided by Financial Markets Group in its series FMG Special Papers with number sp176.
Date of creation: Dec 2007
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Other versions of this item:
- Dirk Schoenmaker & Sander Oosterloo & Otto Winkels, 2008. "The Emergence of Cross-Border Insurance Groups within Europe with Centralised Risk Management," The Geneva Papers on Risk and Insurance - Issues and Practice, Palgrave Macmillan, vol. 33(3), pages 530-546, July.
- NEP-ALL-2008-02-16 (All new papers)
- NEP-IAS-2008-02-16 (Insurance Economics)
- NEP-RMG-2008-02-16 (Risk Management)
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