SPECIFICATIONS OF THE SOURCES OF SECURING INSURANCE COMPANY’S FINANCIAL STABILITY

Abstract

The purpose is to generalize the methodological concepts of domestic researchers in sources of insurance companies' financial stability provision. The need in developing and deepening both theory and practice upon the issues of improving financial stability of the Ukrainian insurance companies facilitated the following tasks: analysis of methodical approaches of native researchers concerning division of financial stability sources; highlighting the most important sources of securing financial stability for insurance companies; feasibility of the role and essence of each factor securing financial stability for insurance companies. Methodology. The study is based on the theoretical analysis of scientific works and practical activity of enterprises. Methodological basis of the article are methods of scientific cognition, which enable to expose basic conformities to the law of development of the insurance companies, priority ways to ensure their financial sustainability. Such methods are in particular used: analysis and synthesis – during research of financial stability of the insurance companies; systematizations – for revealing factors of maintenance of financial stability of insurers, their detailed analysis and definition of their interrelation; scientific abstraction – with the purpose of forming theoretical generalizations and conclusions. Results. The insurance sector plays an important role in the provision of critical financial services. But insurers are exposed to a number of risks and can become distressed or fail. The article examines the essence and importance of insurance company’s financial stability as an important factor in the development and functioning of the insurance market. The economic essence of the general theoretical issues about the financial stability of insurance companies is reviewed and analysed. The main features of insurance companies and the factors that affect their financial stability are investigated. Value. The economic and social importance of insurance is such that the intervention of public authorities, in the form of prudential supervision, is generally accepted to be necessary. Not only do insurers provide protection against future events that may result in a loss, they also channel household savings into the financial markets and into the real economy. The intervention of public authorities has tended to focus on introducing the measures that seek to guarantee the solvency of undertakings or minimise the disruption and loss caused by insolvency. Therefore, the study of the legislative regulation of the factors of providing financial stability of insurance companies is of strategic importance towards creating a stable insurance market in Ukraine.