Reputation:: Some thoughts from an investor's point of view

The author describes the reputation of the insurance industry in Europe from an investor's angle. In the first part, he argues that the industry has suffered from a bad reputation in recent years, driven by "negative'' events such as WTC, pension mis-selling or the U. S. Spitzer investigations. A changing framework, such as Solvency II, and the industry's increased awareness of the importance of reputation contribute to a better picture for the industry. The author elaborates on a changing industry from different stakeholder viewpoints. In the second part, he explains the results of a small survey conducted among 10 major European investors in insurance stocks. The main finding is that investors' valuation models do not explicitly deal with reputation. However, reputation does matter for investment decisions and the main factors influencing reputation from an investor's angle are "management'' and "communication''.