Regulations and soundness of insurance firms: International evidence

Fotios Pasiouras, Chrysovalantis Gaganis

Research output: Contribution to journalArticlepeer-review

52 Citations (SciVal)


This paper provides the first cross-country study on the association between firms' soundness and regulatory policies in the insurance industry. Measuring solvency with an accounting based measure of distance to default, namely the Z-score, we find that the power of the supervisory authorities, and regulations related to both technical provisions and investments have an impact on soundness that is robust to controls for firm-specific and country-specific factors. In contrast, corporate governance and internal control rules do not influence soundness. Similarly, capital requirements do not appear to have a robust impact on soundness.
Original languageEnglish
Pages (from-to)632-642
Number of pages11
JournalJournal of Business Research
Issue number5
Publication statusPublished - Oct 2012


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