Abstract
Dynamic changes in the insurance sector require a new system of
performance measures, which enables monitoring of multiple business segments of
insurance companies and meets the information requirements of a large number of
different stakeholders. In this regard, in the Republic of Serbia a multidimensional
system of performance measures is used - the CARMEL framework, made according to
the methodology of the International Monetary Fund. Due to the fact that these
indicators indicate the effectiveness of different business segments, the analysis of the
performance of insurance companies cannot be based only on one of these groups.
Assessment of financial stability and ranking of insurance companies can be performed
using different data mining algorithms. The obtained results show that key internal
factors for the financial stability of insurance companies change under different
economic conditions. During the period of the financial crisis the greatest impact on the
financial stability of insurance companies had the quality of management, but also the
earning capacity and profitability and liquidity of insurance companies. The
classification of insurance companies according to their performance is compared with
the official rankings offered by the supervisory body based on the value of the balance
sheet assets and the value of premiums paid. It can be concluded that the largest
insurance companies are not the most successful in all economic conditions. Inadequate
capital management, as well as the inability to generate insurance and investment
portfolios, has led to a drastic decrease in the profitability of these insurance
companies
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