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NTU Management Review
Vol. 34 No. 1 Apr. 2024, 91-132
https://doi.org/10.6226/NTUMR.202404_34(1).0003

In-House Provision of Corporate Services: The Case of Property-
Casualty Insurers and In-House Actuarial Loss Reserve
Certification

企業內部服務提供：以美國產險業內部精算師準備金提存
為例

Mary A. Weiss, Department of Risk, Insurance and Healthcare Management, Temple University
Jiang Cheng, Department of Finance and Insurance, Lingnan University
程江 / 嶺南大學財務及保險學系
Tzuting Lin, Department of Finance, National Taiwan University
林姿婷 / 國立臺灣大學財務金融學系
Received 2021/7, Final revision received 2023/6
Abstract
The purpose of this research is to investigate the relationship between managerial
discretion in U.S. Property-Casualty (P-C) accounting reports and the use of an in-house
or Appointed Actuary to certify loss reserves; we use loss reserving errors as measures
of managerial discretion. The results indicate that it is important to distinguish between
healthy and weak insurers in the analysis because their incentives to earnings management
are different. Also, using an in-house or Appointed Actuary to certify loss reserves is
associated with more under-reserving than when an external actuary is used for both weak
and healthy insurers, although the degree of under-reserving is greater for weak insurers.
Finally, the enactment of the Sarbanes-Oxley Act (SOX) leads to more conservative
financial reporting for weak publicly-traded P-C insurers using external actuaries but not
for weak publicly-traded P-C insurers using in-house actuaries.
【Keywords】in-house actuary, Sarbanes-Oxley Act, property-casualty insurance

專題主編：張文瀞教授

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