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Liquidity, solvency and cash flow simulation models in non‐life insurance companies: the Italian experience

Liquidity, solvency and cash flow simulation models in non‐life insurance companies: the Italian... This paper discusses dynamic financial approaches to solvency analysis in non‐life insurance companies by explaining cash flow simulation models which are based on the planning of their typical cash inflows and outflows. Posits that these models take into account patterns of loss reserve run‐offs and asset cash flows by implementing several hypotheses that also include expectations about external economic conditions such as inflation rates and interest rates. Acknowledges the cash inflows and outflows have been planned over a period of time to evaluate how positive net cash flow (liquidity) leads to the increase in assets over liabilities (solvency). http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Managerial Finance Emerald Publishing

Liquidity, solvency and cash flow simulation models in non‐life insurance companies: the Italian experience

Managerial Finance , Volume 30 (5): 21 – May 1, 2004

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Publisher
Emerald Publishing
Copyright
Copyright © 2004 Emerald Group Publishing Limited. All rights reserved.
ISSN
0307-4358
DOI
10.1108/03074350410769083
Publisher site
See Article on Publisher Site

Abstract

This paper discusses dynamic financial approaches to solvency analysis in non‐life insurance companies by explaining cash flow simulation models which are based on the planning of their typical cash inflows and outflows. Posits that these models take into account patterns of loss reserve run‐offs and asset cash flows by implementing several hypotheses that also include expectations about external economic conditions such as inflation rates and interest rates. Acknowledges the cash inflows and outflows have been planned over a period of time to evaluate how positive net cash flow (liquidity) leads to the increase in assets over liabilities (solvency).

Journal

Managerial FinanceEmerald Publishing

Published: May 1, 2004

Keywords: Insurance; Cash control; Italy

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