Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/212323 
Year of Publication: 
2015
Series/Report no.: 
Bank of Finland Research Discussion Papers No. 15/2015
Publisher: 
Bank of Finland, Helsinki
Abstract: 
This paper investigates the role of technical reserves in the income smoothing behavior of insurance companies. This is one of the first attempts in the literature to trace such relationship in the insurance industry, especially at a multi-country setting. The experience of 770 insurance firms operating in 87 countries over the period 2000-2009 reveals that there is a significant evidence of income smoothing. The paper also finds that institutional characteristics, e.g., the rule of law, common law legal origin, economic freedom, and regulations relating to technical provisions and supervisory power constrain income smoothing but other factors such as capital requirements, tax deductibility of provisions, auditing, and corporate governance do not have a significant effect.
Persistent Identifier of the first edition: 
ISBN: 
978-952-323-058-3
Document Type: 
Working Paper

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