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Old 10-17-2018, 06:36 PM
diegol diegol is offline
Join Date: May 2002
Posts: 240
Default Debt to equity ratio for insurance companies

Hi all,

Sorry if this is too obvious a question.

I was analyzing the betas published by Damodaran and seeing the debt to equity ratios for insurance companies, I was wondering what is considered "debt" in this ratio (I assume corporate bonds, but should technical liabilities also be included?).

I would appreciate your insights.

Many thanks.

Kind regards.
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Old 10-17-2018, 07:16 PM
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The_Polymath The_Polymath is offline
Join Date: Jun 2016
Posts: 1,653

Policyholder liabilities are long-term liabilities, so the cashflows would fall under the cost of debt in the WACC part of the CAPM model.
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Old 10-18-2018, 08:50 AM
diegol diegol is offline
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Thanks for your prompt response.
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