Now showing 1 - 10 of 278
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New Advances on Cyber Risk and Cyber Risk Insurance, Editorial to special issue

, Eling, Martin , Boyer, Martin

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Globalization of Insurance Companies: A Blessing or a Curse?

2021 , Biener, Christian , Eling, Martin , Jia, Ruo

A central debate in international business is whether there is a relationship between internationalisation and firm performance, and if so, what its shape and contingent factors are. We use a sample of European insurance companies to show that industry context and cost efficiency are contingent factors of this relationship. Life insurers, particularly those focusing on cost leadership, exhibit a negative impact of globalisation (G) on firm performance (P). We proxy cost leadership by a novel multidimensional measure of cost efficiency and show that it negatively moderates the G-P relationship in the life insurance industry. In contrast, there is no significant G-P relationship and no cost efficiency moderating effect in the nonlife insurance industry. We attribute these results to the higher liability of foreignness driven by greater distance in the globalisation process and by the greater importance of cost efficiency in life insurance as opposed to nonlife insurance.

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Balancing the desire for privacy against the desire to hedge risk

2020 , Biener, Christian , Eling, Martin , Lehmann, Martin

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Risk aggregation in non-life insurance: Standard models vs. internal models

2020-11 , Eling, Martin , Jung, Kwangmin

Standard models for capital requirements restrict the correlation between different risk factors to the linear measure and do not consider undertaking-specific parameters. We propose a comprehensive framework for risk aggregation in non-life insurance using copulas and two levels of aggregation: base-level aggregation (different assets, different lines of insurance) and top-level aggregation (assets and liabilities). Using empirical data from Korean and German insurance companies, we compare our internal risk model with three regulatory standard models (Korean RBC, Solvency II, Swiss Solvency Test). We show that the standard models significantly overestimate the potential risk size for the insurers considered in this study by 61.2% and 57.8% on average for the Korean and the German cases respectively, where almost half of the overestimation level results from the uniform risk profile imposed by regulations and the other half comes from the linear correlation assumption. The differences between standard models and internal models might distort competition when both approaches are used in one market.

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The Economic Impact of Extreme Cyber Risk Scenarios

2022-03 , Eling, Martin , Elvedi, Mauro , Falco, Greg

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Innovations in Microinsurance Research, Editorial to special issue

2021 , Eling, Martin , Dror, David M.

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Cyber risk research in business and actuarial science

2020-10 , Eling, Martin

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Technology Heterogeneity and Market Structure

2022 , Eling, Martin , Jia, Ruo , Jieyu, Lin , Rothschild, Casey

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Governing AI safety through independent audits

2021 , Eling, Martin , Falco, Gregory , Shneiderman, Ben , Badger, Julia , Carrier, Ryan , Dahbura, Anton , Danks, David , Goodloe, Alwyn , Gupta, Jerry , Hart, Christopher , Jirotka, Marina , Johnson, Hendric , LaPointe, Cara , Llorens, Ashley J. , Mackworth, Alan K. , Maple, Carsten , Pálsson, Sigurður Emil , Pasquale, Frank , Winfield, Alan , Yeong, Zee Kin

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Financing Long-Term Care: Some Ideas from Switzerland, comment on “Financing Long-term Care: Lessons From Japan”

2020 , Eling, Martin

Ikegami reviews the implementation of mandatory long-term care insurance systems in Germany and Japan, which are organized as pay-as-you-go systems. I propose to go one step further and implement a multi-pillar, mandatory and voluntary long-term care financing system, which combines pay-as-you-go with capital-funded elements. The proposal is based on the observation that Switzerland has implemented a three-pillar system for financing retirement provisions that can be adapted to finance long-term care in a fair and sustainable way.