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- Title
INSURANCE STOCKS--MEASURING VALUES AND EARNINGS.
- Authors
Townsend, Frederick S.
- Abstract
The article comments on the measuring values and earnings of insurance stocks. One problem with the life insurance convention statement is that it is so conservative that it is extremely difficult to derive a meaningful earnings estimate. Because reserves are established on mortality rates and interest rates which are anticipated to be quite conservative a truly successful business year often results in a downward effect upon a company's earnings. A substantial increase in new insurance written, or improved persistency, will tend to understate a company's true earnings, while a decline in insurance written or worsening persistency will tend to increase a company's earnings.
- Subjects
INSURANCE stocks; INSURANCE companies; STOCKS (Finance); LIFE insurance; COMPENSATION management; PERSONNEL management; LIVING benefits; ECONOMIC indicators; INSURANCE reserves
- Publication
Journal of Risk & Insurance, 1966, Vol 33, Issue 3, p485
- ISSN
0022-4367
- Publication type
Article
- DOI
10.2307/250998