OWNERSHIP AND GOVERNANCE IN THE INSURANCE INDUSTRY - A REVIEW OF THE THEORY AND EVIDENCE

The objective of this paper is to review the coexistence of mutual and proprietary insurance companies from a corporate governance perspecti ve. The paper begins by reviewing the theoretical justification for th e existence of mutual and proprietary companies in the insurance indus try The paper then examines the empirical evidence on insurance compan y performance and seeks to identify whether organisational structure i nfluences managerial behaviour Finally the paper analyses the impact o f insurance conversions (i.e. mutualisation and demutualisation) on th e welfare of policyholders, shareholders and managers in order to iden tify whether the conversion process is motivated by efficiency or expr opriation objectives.