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<p>The relevance of the article is based on an in-depth study of the financial potential of insurers and its impact on the insurance market, which provides valuable information for the stakeholders of the insurance industry. Therefore, this study aims to determine approaches to revealing the essence of the financial capacity of insurers, based on the scientific tools of financial science. The leading approach to the study of this problem is the analysis of the dynamics of liabilities (raised and borrowed funds) and equity capital of insurers and the relationship between them, which enables a comprehensive look at the impact of these indicators on the development of insurance market and internal and external factors that have both an objective and subjective impact on the financial capacity of insurers and the insurance market. The article defines the stages and methodology of assessing the financial condition of insurers. In particular, the normative method, the comparative method, the static method, the formallogical method, the economic-mathematical method, the method of analysis and synthesis became the leading research methods. These assessment methods are crucial for the timely determination of the current state of financial capacity and its potential. Using a multivariate correlation-regression model, the authors demonstrate the importance of various components of financial capacity. The presented results will be useful to various stakeholders in the insurance industry as they provide a deeper understanding of their financial strength, including the dynamics of liabilities, equity and leveraged funds. First of all, it was established that financial resources are the basis of financial capacity. Secondly, the definition of the insurance company’s financial resources as a source and component of the company’s functioning is formulated. Thirdly, it is shown that the insurer’s financial capacity is logically dependent on its investment capacity, which is determined by the amount of financial resources. It was also determined that financial capacity is a dynamic quantity and is manifested only in the process of its use and ideally should be accompanied by its growth. Among them, it was proved that the main components that significantly affect the formation of the financial potential of insurers and the growth of the insurance market of Ukraine are insurance reserves and authorized capital. These conclusions can easily become the basis for the formation of further state insurance policy, which will be followed through legislative reforms, increased competition in the insurance market and will result in an increase in the level of trust among the population.</p>
</abstract>

The relevance of the article is based on an in-depth study of the financial potential of insurers and its impact on the insurance market, which provides valuable information for the stakeholders of the insurance industry. Therefore, this study aims to determine approaches to revealing the essence of the financial capacity of insurers, based on the scientific tools of financial science. The leading approach to the study of this problem is the analysis of the dynamics of liabilities (raised and borrowed funds) and equity capital of insurers and the relationship between them, which enables a comprehensive look at the impact of these indicators on the development of insurance market and internal and external factors that have both an objective and subjective impact on the financial capacity of insurers and the insurance market. The article defines the stages and methodology of assessing the financial condition of insurers. In particular, the normative method, the comparative method, the static method, the formallogical method, the economic-mathematical method, the method of analysis and synthesis became the leading research methods. These assessment methods are crucial for the timely determination of the current state of financial capacity and its potential. Using a multivariate correlation-regression model, the authors demonstrate the importance of various components of financial capacity. The presented results will be useful to various stakeholders in the insurance industry as they provide a deeper understanding of their financial strength, including the dynamics of liabilities, equity and leveraged funds. First of all, it was established that financial resources are the basis of financial capacity. Secondly, the definition of the insurance company’s financial resources as a source and component of the company’s functioning is formulated. Thirdly, it is shown that the insurer’s financial capacity is logically dependent on its investment capacity, which is determined by the amount of financial resources. It was also determined that financial capacity is a dynamic quantity and is manifested only in the process of its use and ideally should be accompanied by its growth. Among them, it was proved that the main components that significantly affect the formation of the financial potential of insurers and the growth of the insurance market of Ukraine are insurance reserves and authorized capital. These conclusions can easily become the basis for the formation of further state insurance policy, which will be followed through legislative reforms, increased competition in the insurance market and will result in an increase in the level of trust among the population.

Financial Capacity of Insurance Companies as a Factor of Stable Development of the Ukrainian Insurance Market

Faculty of Finance, Department of Banking and Insurance

Kyiv National Economic University named after Vadym Hetman

Institute of Economics and Business, Department of Finance, Accounting and Banking

Luhansk Taras Shevchenko National University

Studia Universitatis „Vasile Goldis” Arad – Economics Series

This work is licensed under the Creative Commons Attribution 4.0 International License.

The relevance of the article is based on an in-depth study of the financial potential of insurers and its impact on the insurance market, which provides...

Financial Capacity of Insurance Companies as a Factor of Stable Development of the Ukrainian Insurance Market

Data publikacji: 25 kwi 2024

Zakres stron: 57 - 85

Otrzymano: 01 cze 2023

Przyjęty: 01 wrz 2023

DOI: https://doi.org/10.2478/sues-2024-0008

Słowa kluczowe
financial capacity, insurance company, insurance market, financial resources, share, funds raised

© 2024 Tetyana Kryvoshlyk, et al., published by Sciendo

This work is licensed under the Creative Commons Attribution 4.0 International License.

Financial Capacity of Insurance Companies as a Factor of Stable Development of the Ukrainian Insurance Market

Data publikacji: 25 kwi 2024

Zakres stron: 57 - 85

Otrzymano: 01 cze 2023

Przyjęty: 01 wrz 2023

DOI: https://doi.org/10.2478/sues-2024-0008

Słowa kluczowefinancial capacity, insurance company, insurance market, financial resources, share, funds raised

© 2024 Tetyana Kryvoshlyk, et al., published by Sciendo

This work is licensed under the Creative Commons Attribution 4.0 International License.

Słowa kluczowe
financial capacity, insurance company, insurance market, financial resources, share, funds raised