Underwriting Performance and Investment Risk-Taking in the Property-Liability Insurance Industry

"Economic theory suggests that insurers should prioritize underwriting over investment as a source of income. We find that many U.S. non-life insurers conform to theory: they consistently earn high returns on underwriting and have relatively low-risk investment portfolios. A subset of insurers, however, do the opposite: they consistently earn low returns on underwriting and have relatively high-risk investment portfolios."

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