Drawing a framework from the organizational economics literature this study examines the determinants of corporate (i.e. underwriting and investment related) financial performance in the Bermuda insurance market. Using panel data for 1993-1997, it was found that, as expected, highly leveraged, lowly liquid companies and reinsurers have better operational performance than lowly leveraged, highly liquid companies and direct insurers. Contrary to what was hypothesized, performance was positively related to underwriting risk. However, the size of companies and the scope of their activities were not found to be important explanatory factors.

Using panel data (1997-1999) for 235 publicly listed companies in the People's Republic of China, this study empirically tests the linkage between corporate risks and the decision to purchase property insurance and its financial extent. To achieve these objectives, we first estimate a probit insurance participation decision model and then a fixed-effects insurance volume decision model with Heckman's sample selection correction. Our results indicate that the managerial decision to purchase property insurance is positively related to company size and insolvency risks. By contrast, the amount of property insurance purchased is positively related to systematic risks but negatively related to insolvency and unsystematic risks and company size. We find that the amount of property insurance used by Chinese companies can also be affected by other factors (e.g., the cash flow constraints). In addition, the decision to purchase property insurance and the financial extent to which it is used varies among Chinese companies according to their geographical location. However, state ownership does not appear to be an important determinant of the purchase of property insurance by Chinese publicly listed companies. Copyright 2003 The Journal of Risk and Insurance.

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This paper examines the lead/lag relationships between the FTSE100 stock market index and its related futures and options contracts, and also the interrelation between the derivatives markets. Both the index futures and index options contracts are found to lead the cash index as predicted. However, the call option market appears to marginally lead both the index futures and the put option market. In the only previous paper to examine the inter-market relationships between a stock index and related futures and options contracts, Fleming et al (Journal of Futures Markets, 16, 353-387, 1996) maintain that relative trading costs determine which market leads. As the trading costs of calls and puts are similar, other factors must be driving the relationships observed in this paper. We hypothesize that informed traders with bullish expectations wishing to gain leverage from the options market will buy calls or, with greater risk, sell puts. As market sentiment was bullish for most of the sample period examined, this could explain the call market leads reported.