INFLUENCE OF SELECTED ENVIRONMENTAL FACTORS ON THE EFFICIENCY OF NATIONAL INSURANCE MARKETS.

The insurance industry is an important non-manufacturing sector of the national economy. The insurance market as one of the components of the financial system contributes significantly to the performance of the national economy and influences the economic growth of the state. The insurance market of Europe is a major world segment, which plays an important role in the development of the economy of Europe. Insurance national markets vary in efficiency. Paper aims to analyze the specifics of the efficiency of national insurance market arising from the impact of environmental factors. Models of Data Envelopment Analysis (DEA) are used to analyze the efficiency of national insurance market. Efficiency is evaluated based on the efficiency score. To express the efficiency score, models use linear programming and analyze the efficiency of transformation of multiple inputs to multiple outputs. DMUs that are efficient are part of the data envelopment and their efficiency score is equal to one. DEA models allow for the evaluation of factors which in the short term are not under the influence of the analyzed entities. These are called environmental factors. Impact of environmental factors is studied based on an approach by which divide the analyzed subjects into and in ach subgroup efficiency scores are determined. Target values corresponding to the full efficiency are calculated for inefficient subjects. In the next step the efficiency score is expressed on the basis of above mentioned target values and a statistical hypothesis testing is used to determine the statistical significance of the difference between the efficiency scores in groups. We use the non-parametric Mann-Whitney U test. National insurance markets vary in their efficiency. Insurance markets with a long tradition of insurance are more efficiency. [ABSTRACT FROM AUTHOR]