Date of Last Revision
2023-05-02 23:26:12
Major
Applied Mathematics
Degree Name
Bachelor of Science
Date of Expected Graduation
Spring 2017
Abstract
This paper examines the Financial Strength Rating for insurers conducted by A.M. Best. This study specifically analyzes if the Outlook, another financial stability measure assigned by A.M. Best, has any significant effect on the Financial Strength Rating. This is important because this is the first known study which looks to analyze the Outlook and any effect it may have on A.M. Best ratings and insurance companies. In order to examine the Outlook effect on A.M. Best Financial Strength Ratings, insurer specific financial and operational data are collected from the statutory annual statements filed with the National Association of Insurance Commissioners (NAIC) for the years 1996 through 2015. Various insurance variables such as the insurer’s NAIC number, A.M. Best Financial Strength Rating, A.M. Best Outlook, financial size, and type of company (stock, mutual, or other) are used in t-test and regression analysis. This paper draws conclusions such as a negative Outlook will lead to a decrease in FSR in the current year, the following year, or two years after the negative Outlook is given while a positive Outlook can lead to an increase in FSR in the year following the Outlook or two years of receiving the positive Outlook, however, it is unlikely that the insurer will see an FSR increase in the same year the positive Outlook is given.
Research Sponsor
Dr. Jill Bisco
First Reader
Dr. Curtis Clemons
Second Reader
Sarah Coleman
Recommended Citation
Holder, Ashley, "The Outlook Impact on A.M. Best Ratings" (2017). Williams Honors College, Honors Research Projects. 430.
https://ideaexchange.uakron.edu/honors_research_projects/430