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Financial Reliability of Insurance Companies as the Basis of Their Economic Security
Muzychka O. М., Kopylyuk N. Y.

Muzychka, Oleksandra М., and Kopylyuk, Nazar Yu. (2025) “Financial Reliability of Insurance Companies as the Basis of Their Economic Security.” Business Inform 8:370–378.
https://doi.org/10.32983/2222-4459-2025-8-370-378

Section: Finance, Money Circulation and Credit

Article is written in Ukrainian
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UDC 368:658.14.17

Abstract:
The aim of the article is to substantiate the essence and key characteristics of the concept of «financial reliability of insurance companies» from the perspective of ensuring insurers’ economic security. It is proposed to consider an insurance company’s financial reliability as a comprehensive measure of its activities, based on the adequacy of financial resources, the timeliness of fulfilling obligations under contracts, the ability to generate positive financial flows in the current and future periods, and to develop an impeccable business reputation in the insurance market. It is noted that the concept of financial reliability combines the characteristics of both solvency and financial stability and is an integral part of an insurance company’s financial, and thus economic, security. An insurance company’s financial security is defined as a state in which the insurer’s financial reliability is ensured and its ability to respond flexibly to negative effects of external and internal environmental factors is realized. It is emphasized that financial security, in turn, is integrated into economic security, which reflects the state of protection of an insurance company’s resource potential and its capacity to withstand negative influences from the external and internal environments. The key characteristics of the financial reliability of insurance companies are proposed to include: the ability to meet insurance obligations under client contracts, sufficient financial backing for carrying out insurance activities, timely fulfillment of obligations under insurance contracts (solvency), positive financial performance indicators, adaptability in responding to adverse effects of external and internal factors, the ability to generate positive financial results in both current and strategic periods, the capacity to fully realize the interests of external and internal stakeholders, and maintaining an impeccable business reputation in the insurance sector. The key risk factors in the activities of insurers have been systematized, including changes in regulatory frameworks, technology, climate and ecology, the state of the country’s economic development in terms of its impact on the financial ecosystem, and the presence of cyber risks and cyber threats. Company activities are crucial for the development and security of the insurance market, and their financial reliability affects trust in the insurance sector and shapes the demand for insurance services. Therefore, ensuring the financial reliability of insurers remains a decisive factor not only for financial security but also for the economic security of both individual companies and the insurance market as a whole. Further research should focus on developing methodological approaches to evaluating the financial reliability of insurance companies, substantiating the causal relationships of the factors influencing their economic security.

Keywords: financial reliability of insurance companies, economic security of insurance companies, insurance market, solvency, risks, threats.

Fig.: 1. Tabl.: 1. Bibl.: 12.

Muzychka Oleksandra М. – Candidate of Sciences (Economics), Associate Professor, Associate Professor, Department of Finance, Economic Security, Banking and Insurance Business, Lviv University of Trade and Economics (10 Tuhan-Baranovskoho Str., Lviv, 79005, Ukraine)
Email: [email protected]
Kopylyuk Nazar Yu. – Candidate of Sciences (Economics), Candidate on Doctor Degree, Department of Finance, Economic Security, Banking and Insurance Business, Lviv University of Trade and Economics (10 Tuhan-Baranovskoho Str., Lviv, 79005, Ukraine)
Email: [email protected]

List of references in article

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