Role of insurance company as institutional investitors

Balaban, Mladenka (2014) Role of insurance company as institutional investitors. In: Contemporary trends and prospects of economic recovery. CEMAFI International Association, Nice (France), pp. 730-744. ISBN 978-2-9544508-5-8

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Abstract

Insurance company as institutional investor is very important participant in financial market, especially in Capital Market. They have very important role in contribution to make stronger competition on financial market, stimulating financial innovation, to make stronger corporative governance, to affect in integration in market, on supporting to regulative. In European financial market insurance company are the largest institutional investor with e 8,5 trn. of assets under management as of 31 December 2012. Structure of these assets in 2011 was: 64% government or high-rated corporate bonds and 15% were equities. Investment strategies and asset allocations depend on: prudential regulation, taxation, collateral rules for derivatives. On other hand, investment is core to the provision of insurance products: protection products, life products with investment features, annuities and other products, products with profit-sharing provisions. Aim of this work is to show how insurance companies make their investment strategy and how they make investment decision. This work wants to prove that a range of regulatory developments have the potential to create framework conditions that affect insurers’ ability to continue providing long-term funding to the economy.

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