TY - JOUR
T1 - Explaining the relationship between firm performance and corporate governance of Dutch non-life insurance companies
T2 - Dutch mutual and commercial companies compared
AU - Lambalk, Sebastiaan
AU - de Graaf, Frank Jan
PY - 2017/2/14
Y1 - 2017/2/14
N2 - Comparing the performance of mutual and commercial insurance companies in the Netherlands between 2008 and 2012, this paper gives insight into the relationship between performance and corporate governance. We specifically focused on ownership in relationship with diversification and scale within the perspective of financialization. Although regulators promote commercial, publicly-listed companies do not outperform mutual companies. They even have a significantly worse combined ratio and a tendency for higher acquisition costs. Surprisingly, stock listed insurers do not have lower cost ratios, despite the assumed shareholder push. We found evidence for economies of scale in acquisition costs, but not in company costs. The sample covers 125 observations in the Dutch non-life insurance market between 2008 and 2012. The insights are of great relevance for a sector in the midst of a rapid reform, where questions regarding consolidation reign supreme.
AB - Comparing the performance of mutual and commercial insurance companies in the Netherlands between 2008 and 2012, this paper gives insight into the relationship between performance and corporate governance. We specifically focused on ownership in relationship with diversification and scale within the perspective of financialization. Although regulators promote commercial, publicly-listed companies do not outperform mutual companies. They even have a significantly worse combined ratio and a tendency for higher acquisition costs. Surprisingly, stock listed insurers do not have lower cost ratios, despite the assumed shareholder push. We found evidence for economies of scale in acquisition costs, but not in company costs. The sample covers 125 observations in the Dutch non-life insurance market between 2008 and 2012. The insights are of great relevance for a sector in the midst of a rapid reform, where questions regarding consolidation reign supreme.
U2 - 10.1080/20430795.2016.1269520
DO - 10.1080/20430795.2016.1269520
M3 - Article
VL - 7
SP - 197
EP - 231
JO - Journal of Sustainable Finance & Investment
JF - Journal of Sustainable Finance & Investment
IS - 2
ER -