The determinants of credit ratings in the United Kingdom insurance industry

Mike Adams, Bruce Burton, Philip Hardwick

    Research output: Contribution to journalArticlepeer-review

    55 Citations (Scopus)


    This paper examines the determinants of external credit ratings attained by insurance firms in the United Kingdom (UK) and of the likelihood that insurers will have such an assessment. Using panel data relating to A.M. Best-rated and Standard and Poor's (S&P)-rated insurers over the period 1993–1997, a trichotomous logit model and an ordered probit model with sample selection are employed to show that the factors which influence the likelihood of having external credit assessments not only vary between the two agencies but also differ from those which determine the ratings themselves. Our results are shown to be of potential interest to participants in the insurance industry and policy-makers alike.
    Original languageEnglish
    Pages (from-to)539-572
    Number of pages34
    JournalJournal of Business Finance and Accounting
    Issue number3-4
    Publication statusPublished - 2003


    • Insurance
    • Credit rating
    • Ordered probit
    • Sample selection
    • Panel data


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