Regulating risk culture in the insurance industry using machine learning

IF 2.1 3区 经济学 Q2 BUSINESS, FINANCE
Aparna Gupta, Abena Owusu
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引用次数: 0

Abstract

This study examines the relationship between risk culture and regulation in the insurance industry using textual analysis and machine learning. By analyzing 10-K disclosures, we classify firms into distinct risk culture clusters and find that the risk culture of insurance firms is significantly shaped by their uncertain risk strategies, constraints in defining, implementing, and reporting risks, as well as litigious decisions and risk management practices. A temporal prediction analysis indicates that large insurers maintaining a poor risk culture trend are less likely to reverse it compared to those improving. Moreover, insurance firms show enhanced risk culture post-Dodd–Frank Act. Our findings underscore the potential benefits of regulations aimed at monitoring and overseeing insurers' risk practices.

利用机器学习规范保险业的风险文化
本研究使用文本分析和机器学习来检验保险业风险文化与监管之间的关系。通过分析10-K披露,我们将保险公司划分为不同的风险文化集群,并发现保险公司的风险文化在很大程度上受到其不确定的风险策略、定义、实施和报告风险的约束以及诉讼决策和风险管理实践的影响。一项时间预测分析表明,与那些正在改善的大型保险公司相比,保持不良风险文化趋势的大型保险公司扭转这种趋势的可能性较小。此外,保险公司在《多德-弗兰克法案》后表现出增强的风险文化。我们的研究结果强调了旨在监测和监督保险公司风险实践的法规的潜在好处。
本文章由计算机程序翻译,如有差异,请以英文原文为准。
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来源期刊
CiteScore
3.50
自引率
15.80%
发文量
43
期刊介绍: The Journal of Risk and Insurance (JRI) is the premier outlet for theoretical and empirical research on the topics of insurance economics and risk management. Research in the JRI informs practice, policy-making, and regulation in insurance markets as well as corporate and household risk management. JRI is the flagship journal for the American Risk and Insurance Association, and is currently indexed by the American Economic Association’s Economic Literature Index, RePEc, the Social Sciences Citation Index, and others. Issues of the Journal of Risk and Insurance, from volume one to volume 82 (2015), are available online through JSTOR . Recent issues of JRI are available through Wiley Online Library. In addition to the research areas of traditional strength for the JRI, the editorial team highlights below specific areas for special focus in the near term, due to their current relevance for the field.
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