Introduction
Insurance is the “promise” that insurers make to policyholders in exchange for premiums. The insurance industry is built on policyholder’s confidence that insurance contracts will be fulfilled and eligible claims paid. For consumers, the purchase of insurance is a key component of how they manage their financial risk. Consumer confidence in the industry is, therefore, insurance is closely linked to confidence in the solvency of their financial institutions.
Insolvency arises when insufficient assets and capital are in place to cover the claims liabilities incurred. Insurer liquidation shows claimers and policyholders to the risk of unexpected financial […]
