STRATEGIC ASPECTS OF ENSURING FINANCIAL AND ECONOMIC SECURITY OF INSURANCE COMPANIES IN THE CONTEXT OF THE DEVELOPMENT OF INSURANCE SERVICES COMPETITIVE MARKET

Anna HONCHARENKO, Nataliia ZACHOSOVA, Oleksii KOVAL

Abstract


Introduction. Insurance is an important part of the formation of the financial security system of the state. Insurance in Ukraine covers less than 15% of the insurance field, which allows us to predict the rapid development of the insurance market in the near future. The insurance industry in Ukraine will be able to provide more diverse insurance services as it builds its potential. At the same time, the expansion of insurance will create space for the emergence of new threats to the normal operation of insurers, and the issue of ensuring their financial and economic security in the new operating conditions will become even more relevant.

The reason for bankruptcy and liquidation of insurance companies in many cases is the low level of their financial and economic security. Therefore, it is necessary to draw the attention of the scientific community and insurance professionals to the problem of finding new opportunities to counter the risks and threats of insurance activities and to develop a mechanism for timely identification of declining financial and economic security of the insurer.

Purpose. The purpose of the study is to establish areas for financial and economic security of insurance companies in the context of the development of a competitive insurance market in Ukraine. To achieve this goal, important tasks are: the study of the current state of development of the insurance market and the development of a list of practical recommendations for increasing profitability and improving the management of financial and economic security of domestic insurers.

Methods. In the course of research the monographic method and a method of the theoretical analysis are used. Techniques of content analysis and synthesis are also used. The method of generalization was used in the process of forming conclusions based on the results of the study. A graphical method was used to visualize the stratistic data.

Results. The article examines a set of issues related to insurance activities and ensuring its financial and economic security. The concept of financial and economic security of the insurance company, the essence and strategic aspects of its provision are studied. The definition of strategic management of financial and economic security of an insurance company is offered. The necessity of increasing the level of financial and economic security of insurers is substantiated and proposals are given on perspective directions of its improvement.

Originality. The main threats for the security-oriented functioning of the competitive insurance market in Ukraine today are: cyber-attacks, lack of mechanisms to control the transparency of insurance market participants, low efficiency of regulation and quality control of insurance services, non-compliance of domestic insurance products with European standards, lack of national strategy of safety-oriented development of the insurance market. One of the main reasons for bankruptcy and liquidation of insurers is the inadequate level of their financial and economic security, which may be caused by the imbalance of insurance portfolios of companies. The main recommendations for increasing the level of profitability and modernization of financial and economic security management of insurance companies may be as follows: working out a general strategy for the development of the insurance company for five years, taking into account threats of digitalization of financial relations and trends in behavioral economics and interests of the company in the long run, ensuring the balance of the insurance portfolio, ensuring the appropriate level of qualification of employees of insurance companies, creating a separate unit for financial and economic security, developing new effective advertising strategies, implementing new insurance products (eg. cyber insurance).

Conclusion. Further development of the competitive insurance market of Ukraine is impossible without ensuring financial and economic security of insurance companies in the strategic perspective, which, in turn, requires the development of theoretical and methodological provisions and practical recommendations for modernizing economic relations in the field of insurance and economic security. With the spread of digital and behavioral economic models, insurers face an important task of building a quality policy of strategic management of financial and economic security, which should be based on maintaining their proper financial condition, ensuring financial reliability and stability in the long run and tactical perspectives.


Keywords


insurance activity, strategy, financial and economic security, management, insurance companies, insurance services market, threat.

References


Herasymenko, O.M. (2017). Features of formation and functioning of the system of economic security of business and entrepreneurship institutions by types of economic activity. Hlobalni ta natsionalni problemy ekonomiky (Global and national economic problems), 16, 496-503.

Zanora V.O., Sklyar A.V. (2016). Management of economic security of economic entities: theoretical and methodological aspects of system organization. Naukovyy visnyk Mizhnarodnoho humanitarnoho universytetu. «Ekonomika i menedzhment» (Scientific Bulletin of the International Humanities University. "Economics and Management"), 2, 74-77.

Kovalenko, A. (2019). Determinants of personnel policy in the process of management of financial and economic security of business entities. Bulletin of the Cherkasy Bohdan Khmelnytsky National University. Еconomic Sciences, 3, 70-77.

Kutsenko, D.(2019). Orienters of strategic management of financial and economic security of enterprises: interests, challenges, risks. Bulletin of the Cherkasy Bohdan Khmelnytsky National University. Economic Sciences, 2, 50-58.

Zachosova, N.V. (2019). Innovative approach in the estimatology of financial institutions economic security: possibilities of use in management and regulatory activity within the means of provision of the state financial security. Baltic Journal of Economic Studies, 5(2), 45-56.

Zachosova, N.V. (2010). The mechanism of creating an investment guarantee fund as a subject of protection of economic security of asset management companies and securities traders in Ukraine. Ekonomichnyy chasopys-XXI (Economic Journal-XXI), 5-6, 18-23.

Furman, V.M., Zachosova, N.V. (2015). Features of economic security management of modern insurance companies as one of the types of financial institutions. Ahrosvit (Agrosvit), 15, 20-25.

Nahaychuk, N. H. (2014) Tools for financial security management of insurers. Visnyk Universytetu bankivsʹkoyi spravy Natsionalʹnoho banku Ukrayiny (Bulletin of the University of Banking of the National Bank of Ukraine), 2, 195-198.

Hnylytska, L. V., Savelyeva, A.V. (2015). Modern experience in forming a system of economic security in insurance companies of Ukraine. Finansy, oblik i audyt (Finance, accounting and auditing), 1, 186-197.

Results of insurance companies (2019). Retrieved from: https://nfp.gov.ua/files/OgliadRinkiv/SK/sk_2019.pdf. (Accessed: 01.04.2020).

Ruban, O.O. (2011). Financial security of the insurance company as an integral characteristic of the financial condition. Problemy i perspektyvy rozvytku bankivsʹkoyi systemy Ukrayiny: zbirnyk naukovykh prats (Problems and prospects of development of the banking system of Ukraine: a collection of scientific works), 33, 330-337.

Tkachenko, N.V. (2011). The role of regional network stability and business reputation in ensuring the financial security of the insurance company. Naukovyy visnyk Lʹvivsʹkoho natsionalʹnoho derzhavnoho universytetu vnutrishnikh sprav (Scientific Bulletin of Lviv National State University of Internal Affairs), 1, 155-163.

Bratyuk, V.P. (2018). Financial and economic security of insurance organizations. Retrieved from https://ojs.kname.edu.ua/index.php/area/article/view/1878 (Accessed: 01.04.2020).


Full Text: PDF

Refbacks

  • There are currently no refbacks.
Archive
2015 4 12   24 33  
2016 1 2   3 4  
2017 1 2 (V.1) 2 (V.2) 3 4 (V.1) 4 (V.2)
2018 1 2   3 4  
2019 1 2   3 4  
2020 1 2   3 4  
2021            

User

Information

Journal Content

Browse

Language