Stimulating and limiting factors for the growth of investment potential of Ukrainian insurance companies

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The fact that the accumulated investment potential (IP) of insurance companies (IC) does not have a significant impact on the processes of economic growth in Ukrainian practice actualizes the task of researching the practice of investing in the activities of domestic insurers. The purpose of the study is to find out, classify and highlight the main factors that influence the formation of the Ukrainian IC’ IP and give recommendations for overcoming a number of related difficulties. According to the results of investigation of the Ukrainian insurance industry development trends in 2011–2018, it was concluded that rates of their IP accumulation are insufficient. There is a decrease in the aggregate value of insurers’ investment assets and a reduction in the composition of investment attractive financial instruments. Low efficiency and simplification of investment strategies of IC are noted. The factors that exert a stimulating and inhibitory influence on the investment processes in the Ukrainian insurance market were identified. Ways and tools were proposed to strengthen the effect of incentive factors and eliminate or minimize the effect of the considered restrictive factors that can be used in the practice of state regulation of the insurance industry of the country. Considering the examined factors should allow the state regulators making more effective decisions to improve the investment activity of insurers and enhance its importance in the development of the national economy.

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    • Figure 1. Amount of investment assets and insurance reserves of Ukraine in 2011–2018, UAH billion
    • Figure 2. List of risks of IC investment activity
    • Table 1. Annual growth rates of IC in Ukraine in 2011–2018, %
    • Table 2. Structure of total investment assets of Ukrainian IC in 2011–2018, %
    • Table 3. Structure of financial income of Ukrainian IC, received from investment allocation in 2011–2018, %
    • Table 4. Stimulating and limiting factors of IP development of the Ukrainian insurance sector