Insurance Business

In the USA the first insurers as the independent juridical persons created for insurance, have appeared in 1720. The period of initial development of the USA in the field of insurance is connected with occurrence of a great number of the companies-something ephemeral which were becoming bankrupts and spreading panic among consumers. It has led to the decision of Parliament on monopoly of insurance operations on insurance of corporate interests by two insurers The London Assurance Corporation and The Royal Exchange Assurance Corporation, performing operations on insurance in the USA and until now. Appreciably at that time on North American continent branches and departments of insurers from Great Britain were engaged in insurance carrying out. However the requirements determined by economic growth of national economy, have led to creation and national insurers. In 1752 B.Franklin has acted founder as one of the first insurance companies on insurance upon fire in Philadelphia – The Philadelphia Contributionship. The first insurance society founded in the form of joint stock company, has appeared in 1794, the first specialized society on life insurance is founded in 1759.

The American insurance monopolies supervise about 50 % of the insurance market of developed countries of the world. In the USA works about 9 thousand companies of property insurance and about 2 thousand the companies which are engaged in life insurance and health. Assets of all companies constitute about 2,5 bln. dollars. On the average assets of one company constitute 950 million dollars, and on 12 largest companies it is necessary 60 billion dollars.

In the USA there are two types of the insurance companies: societies of a mutual insurance and joint stock companies. The state insurance firms doesn’t exist at all. Shares of joint stock companies can acquire both physical, and the juridical person.

Insurers of the USA sit in 27 of each 100 boards of directors of the American industrial corporations. Ahead of the insurance companies in this plan – only commercial and investment banks.

The organizational basis of the American insurance companies is constituted by joint stock companies and mutual insurance societies. There is an institute of underwriters and insurance brokers – insurance agents or independent broker firms.

The largest insurance companies represent financial conglomerates: through affiliate companies they can be engaged besides insurance in granting of credits and loans, to organize check customer service, to emit settlement credit cards, to perform operations with real estate, with securities, to manage property and the capital on the instructions of clients.

Insurance in the USA is divided on two industries: life insurance and other kinds of insurance. The largest insurer in the USA is company State Farm Group occupying with divisions 18 of % of the market of insurance of cars and 23% of life insurance, and as a whole on the market – 12%. This indicator twice exceeds a company market share “Allstate Insurance Group”, an occupying 2 place. On a company share “American Insurance Group” (AIG) it is necessary approximately 4% of the market of other kinds of insurance.

AIG takes the second place in the world on insurance of real estate and upon accidents. Exists AIG since 1919 and represents the holding company supervising 44 affiliate companies worldwide. All companies are united in 6 departments. Besides insurance and reinsurance, the company sphere of action includes financial services, pension accruals and assets management.

One of leading widely diversified insurance companies of the USA “IGNA” is based in 1982. The main interests of corporation are connected with property and responsibility insurance. A number of affiliated firms is engaged in broker operations, pension and personal insurance. They act in 160 countries. Corporation CIGNA – one of pioneers in use of computer technics in the international insurance operations.

One of the largest companies on property insurance – corporation “All State Insurance Company” based in 1931. The company concludes various kinds of contracts of insurance: from accidents, road accidents, flooding, fires, earthquakes, insures air passengers, etc. Owns fifteen affiliate companies.

One more of the largest insurance groups of the USA – “Continental Corporation,” is based in 1853. Renders insurance services almost in 100 countries of the world. Specializes on reinsurance and transport insurance.

The largest the companies on life insurance is “The Prudential Insurance Company of America,” based in 1873. Kinds of contracts of insurance are various: individual and collective (group) insurance, usual life insurance, insurance on a case of death with lifelong payment of installments, insurance with participation in company profits, insurance of pensions, medical expenses, etc.

In the USA the electronic databank on all insurance companies is widely used, it gives the chance to allocate the companies on risk, the sizes of awards etc.

The largest companies of the USA on life insurance accept the multi-billion means belonging to various pension funds in management. The task of insurance societies in this case – by the reasonable investment policy to provide safety and a gain of confidential means. For management of these means the insurance companies levy a commission fee at a rate of 0,1 % from the sums taken in management that brings in million incomes.

Investment investments have huge value for the American societies on life preserving. Huge investment resources transform the insurance companies into one of the influential external centers of financial screening in relation to industrial corporations.