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Insurance Definition: CAPITAL

By Compuquotes Team on March 27th, 2008

CAPITAL:

Definition:

  • Shareholder's equity (for publicly-traded insurance companies) and retained earnings (for mutual insurance companies). There is no general measure of capital adequacy for property/casualty insurers. Capital adequacy is linked to the riskiness of an insurer's business. A company underwriting medical device manufacturers needs a larger cushion of capital than a company writing Main Street business, for example. (See Risk-based capital; Surplus; Solvency)

Information provided by Insurance Information Institute

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