Centro de Documentacion de Fundación MAPFRE - The Effect of taxes on the location of property-casualty insurance firms

MAP20200040064

The Effect of taxes on the location of property-casualty insurance firms / Martin F. Grace, David L. Sjoquist

Sumario: States levy insurance premium taxes, which are essentially gross receipt taxes on premiums. An unusual characteristic of insurance premium taxes is that in each state in which an insurance company writes premiums, the firm pays the higher of the tax rate in the state in which the company is domiciled and the state in which the policy is written. Thus, the choice of location has a significant effect on the firm's tax liability. Using firm-level data for the property-casualty (P-C) insurance industry, we calculate the firm-specific tax rate for each P-C firm for every possible state of domicile. We estimate conditional logistic models to analyze the effect of insurance premium taxes on the choice of the state of domicile of existing and relocated firms. We find robust evidence of a small, negative, and statistically significant effect of these taxes on the choice of the state of domicile

En: The Journal of risk and insurance. - Nueva York : The American Risk and Insurance Association, 1964- = ISSN 0022-4367. - 01/12/2020 Volumen 87 Número 4 - diciembre 2020 , p. 1035-1062

1. Empresas de seguros . 2. Seguro de daños patrimoniales . 3. Impuestos . 4. Primas de seguros . I. Sjoquist, David L. . II. Título.