Investigating Risk Disclosure Practices in the European Insurance Industry
The Geneva Papers, Vol. 36, No. 3, 380-413, July 2011
Posted: 8 Apr 2011 Last revised: 17 Jan 2018
Date Written: June 1, 2011
Abstract
In light of the upcoming Solvency II Pillar 3 disclosure regulation for the insurance industry, this paper explores the risk disclosure practices in annual reports of European primary insurers in the Dow Jones Stoxx 600 Insurance Index between 2005-2009. Based on a self-constructed risk disclosure index, the study examines the relation between the extent of risk disclosure and insurance companies' characteristics such as size, risk, profitability, ownership dispersion, cross-listing, home country, and type of insurance sold, to draw inferences regarding motives for enhanced risk disclosure based on positive accounting theory.
Keywords: Risk disclosure, insurance, Solvency II, content analysis, positive accounting theory
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