Liquidity

• The flow of money from the insurance activity.
• General flow of money.
• Liquidity of investment briefcase.

The flow of money from the insurance activity are formed due to the income from the obtained insurance rewards minus the sums, paid out on the actions from the insurance, commission and expenditures for business. In the course of time the sum of enterings from the insurance activity of any effectively working insurance company must exceed expenditures. Nevertheless, the agency “Of standard & Of poor's” recognizes that in view of the nature of some forms of insurance activity (some forms of general insurance and [perestrakhovanie]) can be observed the specific instability of the dynamics of the flow of money from one year to the next. Some differences in this respect can also appear as a result the noncoincidence of the nomenclature of insurance products and services, proposed by different companies. The flow of money from the insurance activity can absolutely reliably reflect the results of the work of companies, which are oriented down the short term products, while work with the long-term insurance tools it can be connected for the sake of the redundancy, whose sums are not always reflected before the flow of money of the present year.

The general flow of money (which must in the course of time be characterized as far as the unequivocal exceeding of enterings above the expenditures) are the flow of money from the insurance activity taking into account obtained investment and other income minus the dividends, paid out to the holders of policies, taxes and other payments. The agency “Standard & Of poor's” usually excludes from the calculation the realized incomes from increase in the cost of capital (active memberships); however, it recognizes that the differences between investment strategies, practiced before different regions (for example, the preference of incomes from increase in the cost of capital to the current incomes), can affect the values of the corresponding indices. , where this is necessary, the differences indicated are considered with the calculation of indices.

The realization of the specific investment active memberships is one of the sources of liquidity; however, the ability to realize such active memberships - from maximally compressed periods and/or on the desired price - often in many respects depends on the current market situation. In connection with this the agency “Of standard & Of poor's” examines the realization of active memberships only as the secondary source of liquidity. Companies, which need sale of active memberships at the point of the large sums for guaranteeing the daily activity, can prove to be before face of serious problems.

Finally, the agency “Of standard & Of poor's” explains, does have insurance company credit lines before the banks or other financial institutions before the case of the appearance of the urgent need at the point of the liquidity.