Determining the leaders of Ukraine’s insurance market based on the adaptation of the DEA method
-
Author(s)Nadiia ShmygolLink to ORCID Index: https://orcid.org/0000-0001-5932-6580
,
Vyacheslav GlushchevskyLink to ORCID Index: https://orcid.org/0000-0002-2124-5985
,
Olena CherniavskaLink to ORCID Index: https://orcid.org/0000-0001-9819-578X
,
Lyazzat SembiyevaLink to ORCID Index: https://orcid.org/0000-0001-7926-0443
,
Vitalii ByrskyiLink to ORCID Index: https://orcid.org/0009-0001-4150-8754
,
Viktoriia KhoroshunLink to ORCID Index: https://orcid.org/0000-0002-7757-8041
,
Yevhenii MerzhynskyiLink to ORCID Index: https://orcid.org/0000-0002-4372-889X
-
DOIhttp://dx.doi.org/10.21511/ins.15(2).2024.02
-
Article InfoVolume 15 2024, Issue #2, pp. 14-25
- 10 Views
-
1 Downloads
This work is licensed under a
Creative Commons Attribution 4.0 International License
The escalating wartime risks in Ukraine has led to a rapid reduction in insurance coverage in life and non-life segments. The purpose of the study is to rank Ukraine’s insurance companies based on an adaptation of the DEA method to the insurance market conditions. The study utilized the Supervisory Statistics of the National Bank of Ukraine as data. The study also used ranking of insurance companies based on technical efficiency criteria. The output indicators include the profitability of total capital (Output1) and the occupied share of the insurance market (Output2). The input indicators comprise the volume of total assets of insurers (Input1), the share of equity capital in assets (Input2), the level of gross payments (Input3), and the level of payments to insurance reserves (Input4). The ranking of insurance companies is based on minimizing the distance of each from the bounds of technical efficiency by solving a set of optimization problems. Based on the modeling results, a list of market leaders (7 companies) was formed for the end of the third quarter of 2023. They served nearly 37% of the insurance market in Ukraine, accumulating 41.5% of the total assets of this financial market sector. So, the primary issue for insurance companies is the loss of solvency due to the absence of adequate levels of insurance reserves. Therefore, priority measures should include strengthening regulatory constraints in this financial market segment to facilitate its qualitative renewal.
- Keywords
-
JEL Classification (Paper profile tab)G22, G32, L25
-
References33
-
Tables1
-
Figures1
-
- Figure 1. Quarterly dynamics of Ukraine’s insurance market and the number of insurers based on data from 2020–2023
-
- Table 1. Leaders of the Ukrainian insurance market as of the end of the third quarter of 2023
-
- Abdikadirova, A., Sembiyeva, L., Temirkhanov, Z., Popov, A. I., & Suchikova, Y. (2024). Evaluating the nexus of funding and scientific output in Kazakhstan. Knowledge and Performance Management, 8(1), 17-31.
- Baranov, A., & Baranova, O. (2022). Some Features of State Regulation of the Insurance Market of Ukraine in Conditions of Martial Law. Finance of Ukraine, 7, 95-114.
- Blagun I. S. (2020). Evaluation of the efficiency of commercial banks using the DEA method. Business Inform, 11, 192-197.
- Bratyuk, V. (2022). Current State of the Insurance Market in Ukraine. Tavria Scientific Bulletin. Series: Economics, 12, 37-45.
- Demydenko M. A., & Pistunov I. M. (2021). Increasing the competitiveness of insurance company products and services using economic and mathematical modeling methods. Scientific View: Economics and Management, 4, 98-105.
- Drimalovska, K. V., & Kyryliuk, R. O. (2021). Key features of the modern world insurance market. Business Inform, 4, 36-41.
- Dyba, V. (2017). Using The Stochastic Modeling for Ensuring Stable Development of the Insurance Companies Saving Type Inthe Ukrainian Market. Economic Bulletin of the National Technical University of Ukraine “Kyiv Polytechnic Institute”. (In Ukrainian).
- Hranovska, I., Yaremenko, L., & Malishko, V. (2023). The Current State and Problems of the Development of the Insurance Market Under the Conditions of Marital State. Money, Finance, and Credit: Black Sea Economic Studies, 81, 167-172. (In Ukrainian).
- Iurchenko, M. (2020). Modeling of insurance risks. Effective Economy, 3.
- Khroponiuk, D., & Dlugopolskyi, O. (2022). Current problems and development prospects of the insurance market of Ukraine. Innovation and Sustainability, 1, 118-126. (In Ukrainian).
- Kotsiurba, O. Yu., & Nasypaiko, D.S. (2020). Insurance market of Ukraine: current state and development problems. Central Ukrainian Scientific Herald. Economic Sciences, (5), 284-291.
- Kuzmak, O., & Svereda, Y. (2023). Organizational and law aspects of the development of the insurance market in Ukraine. Economic Forum, 1(1), 146-150.
- Legislation of Ukraine. (2021). Law of Ukraine “On Insurance,” No. 1909-IX.
- Marina, A., & Petsenko, M. (2023). Strakhovyi rynok Ukrainy v umovakh viiny [Insurance Market of Ukraine in the Conditions of War]. Digital Economy and Economic Security, 5(05), 44-51. (In Ukrainian).
- Melnychuk, N. Yu., Zaliubovska, S. S., & Kolupaiev, Yu. B. (2020). Strakhovyi rynok Ukrainy: stan ta perspektyvy rozvytku [Insurance market of Ukraine: state and development prospects]. Scientific Bulletin of the National Academy of Statistics, Accounting and Audit, 1-2, 81-90. (In Ukrainian).
- Miachyn, V. H., & Yavors’ka, О. B. (2018). Modern Methods and Models of Functioning Insurance Market. Scientific Herald of Uzhhorod National University, 21(2), 37-40. (In Ukrainian).
- National Bank of Ukraine (NBU). (2024). Supervisory Statistics of the National Bank of Ukraine: Indicators of Insurance Companies’ Activities. (In Ukrainian).
- Nowak, M. (2015). Praxeological evaluation of the usefulness of the DEA method in the diagnosis of organizational efficiency. Zeszyty Naukowe Politechniki Poznańskiej, 66, 101-112. (In Polish).
- Purii, H.M. (2018). Insurance market of Ukraine: current state and problems of development. Efficient Economy, 10.
- Romashko, O.M., & Shpylchak, O.I. (2020). New approaches to the Interpretation of the Insurance Market. Problems and Prospects of Economics and Management, 1(21), 259-266. (In Ukrainian).
- Rud, I. (2019). Strakhovyi rynok Ukrainy: analiz ta perspektyvy rozvytk [Insurance Market of Ukraine: Analysis and Development Prospects]. Scientific Herald of Uzhhorod National University, 23(2), 87-91. (In Ukrainian).
- Shapoval, L., & Kolotiy, Y. (2019). Financial Modeling of Cash Flow Management in an Insurance Company. Institute of Accounting, Control and Analysis in the Conditions of Globalization, 1-2, 142-96.
- Shmygol, N., Galtsova, O., Yelisyeyeva, O., & Belozertsev, V. (2021, November). Priority areas of state regulation of the industry in the context of sustainable development. In IOP Conference Series: Earth and Environmental Science, 915(1), 012028.
- Škare, M., & Rabar, D. (2015). Measuring Economic Growth Using Data Envelopment Analysis. Amfiteatru Economic Journal, 18(42), 386-406.
- Slobodyanyuk, O., & Orlov, V. (2021). Modeling the Financial Activities of Insurance Companies in Conditions of Risk Insurance. Modeling the Development of the Economic Systems, 1, 71-77.
- Steshenko, O., & Gamora, V. (2019). Research of the Life Insurance Market in Ukraine in the Conditions of Eurointegration. Problems and Prospects of Entrepreneurship Development, 2, 210-218. (In Ukrainian).
- Sukhovyi, G. P., & Yakovleva, O. S. (2020). Peculiarities of functioning of medical insurance financing models. Modern science: innovations and prospects: Proceedings of the I International Scientific and Practical Conference (pp. 79-85). Stockholm.
- Tarnavskyi, O., & Kolomiiets, V. (2021). Identifying Insurance Companies’ Business Models in Ukraine: Cluster Analysis and Machine Learning. Visnyk of the National Bank of Ukraine, 252, 37-55.
- Tymchak, M. V., & Chepara, I. P. (2023). Reformuvannia strakhovoi diialnosti v Ukraini: kontseptualni pidkhody ta perspektyvy rozvytku [Reforming Insurance Activities in Ukraine: Conceptual Approaches and Development Prospects]. Scientific Herald of Uzhhorod University, 1(61), 166-171. (In Ukrainian).
- Vovk, V., Zhezherun, Y., & Kostohryz, V. (2023). The Insurance Market of Ukraine in the Period of Marital Law: Financial and Marketing Aspects. Problems and Perspectives of Economics and Management, 3(35), 119-131.
- Zagoruyko, I. O., & Petkova, L.O. (2021). The DEA method as a tool for comparative analysis of the efficiency of national economies. Collection of Scientific Works of the Cherkasy State University of Technology, 62, 82-92.
- Zavidna, L., Makarenko, P. M., Chepurda, G., Lyzunova, O., & Shmygol, N. (2019). Strategy of innovative development as an element to activate innovative activities of companies. Academy of Strategic Management Journal, 18(4), 1-6.
- Zoria, S.P., Chumak, V.D., & Mysnyk, T.G. (2018). Features of the insurance market functioning in Ukraine. Efficient Economy, 12.
-
Regulating Big Data effects in the European insurance market
Donatella Porrini 
doi: http://dx.doi.org/10.21511/ins.08(1).2017.01
Insurance Markets and Companies Volume 8, 2017 Issue #1 pp. 6-15 Views: 2106 Downloads: 372 TO CITE АНОТАЦІЯThe article analyzes the regulatory framework in the insurance market in connection with the advent of Big Data, such as information collected from different sources that can be manipulated by new technologies. The use of Big Data offers significant opportunities to the insurance companies in terms of digitization of the distribution channels and greater knowledge of the customers, which is instrumental to a more effective identification of the individual’s risk profile, as well as improvement of the competitiveness. However, regulatory measures are needed for a proper use of Big Data in terms of respect of the individual privacy, potential discrimination and constraint on competition.
-
Financial market imbalance: reasons and peculiarities of occurrence in Ukraine
Rostyslav Slav’yuk ,
Lyudmyla Shkvarchuk ,
Iryna Kondrat
doi: http://dx.doi.org/10.21511/imfi.14(1-1).2017.09
Investment Management and Financial Innovations Volume 14, 2017 Issue #1 (cont.) pp. 227-235 Views: 1933 Downloads: 326 TO CITE АНОТАЦІЯFinancial imbalance is the reason of a macroeconomic instability. This study aims at identifying the institutional causes of financial markets imbalance. The authors consider that financial intermediaries in Ukraine work in a speculative market segment carrying out high-risk transactions with the purpose of earning a huge profit. In fact, in Ukraine the role of these institutions in the investment process financing is insignificant. The authors show that soundness of banks along with the ease of access to loans and a low level of confidence in national banking system are the main reasons of instability in financial market in Ukraine. Due to scarcity of financial capacity and refusal to carry out transactions in a high-risk market segments, insurance companies are unable to entirely perform functions of risk redistribution. Competitiveness of Ukrainian financial market remains low with a limited financial services nomenclature and it may be considered to be attractive for potential foreign investors.
-
Analysis of the efficiency performance of Sharia and conventional banks using stochastic frontier analysis
Isfenti Sadalia ,
Muhammad Haikal Kautsar ,
Nisrul Irawati ,
Iskandar Muda
doi: http://dx.doi.org/10.21511/bbs.13(2).2018.03
Banks and Bank Systems Volume 13, 2018 Issue #2 pp. 27-38 Views: 1441 Downloads: 252 TO CITE АНОТАЦІЯThere are two sectors of banks operating in Indonesia, namely Sharia banks and conventional banks. Improving performance is important in maintaining public confidence in the bank. Efficiency is one of the parameters to measure the performance of Sharia banks. This study measures the comparative level of technical efficiency of Sharia commercial banks and conventional banks by Stochastic Frontier Analysis method during 2011–2015 period by using 10 samples of Sharia commercial banks and conventional banks. Input variables in this study are total deposits, operational costs, and other operational costs. Total financing is an output variable. The results of this study show that total deposits and operational costs have a positive and significant impact on total financing in Sharia and conventional banks. The average score of the technical efficiency of Sharia commercial banks during the period observed is 0.84 and conventional banks is 0.85.
