Managerial legal liability coverage and earnings conservatism

This paper examines the effect of managerial legal liability coverage on earnings conservatism. Using directors’ and officers’ (D&O) liability insurance coverage and cash for indemnification as a proxy for managerial legal liability coverage, we find that the higher the managerial liability coverage, which reduces the expected legal liability of managers, the less conservative the firm's earnings. We also find that managerial legal liability coverage has a stronger influence on earnings conservatism in a legal regime with higher litigation risk. Our results are consistent with the threat of litigation conditioning managers to practice conservative accounting.     

论环境责任保险中政府的作用

环境的负外部性是造成环境污染的重要原因,环境责任保险是通过责任风险社会化解决环境污染损害赔偿问题的有效方式之一。但在现阶段,要发展环境责任保险只能依靠政府强制的力量,本文结合我国现状,分析了政府在推动环境责任保险发展中应发挥的作用。     

Voluntary versus mandatory disclosure of liability insurance coverage limit

This article analyzes the disclosure of the liability insurance coverage limit and the impact of mandating disclosure of the coverage limit in a setting where voluntary disclosure of a firm’s cash flow information is subject to litigation risk and the firm has directors’ and officers’ (D&O) liability insurance. Disclosure of cash flow information is costly, but disclosure of the insurance coverage limit features no direct disclosure friction. We find that, when the litigation environment is weak, the usual unraveling argument applies, and the manager always voluntarily discloses the coverage limit in equilibrium. However, when the litigation environment is strong, either no coverage limit is disclosed or only sufficiently high coverage limits are disclosed in equilibrium. Further analysis shows that mandatory disclosure of the coverage limit increases the voluntary disclosure of cash flow information.     

德国侵权法与责任保险的互动关系及对中国的启示

侵权法和责任保险是两个各自独立却又紧密联系、相互影响的体系。本文分别介绍了德国侵权法的法律体系和德国责任保险的概况,以及德国侵权法与德国责任保险之间的相互影响。中国和德国同为大陆法系国家,现行和未来的侵权法又直接或间接地受德国的影响较深,因此,德国在侵权法和责任保险之间的互动关系所涉及经验和教训值得中国借鉴。     

针对药源性损害的责任保险探析

本文讨论了针对药源性损害,在我国开展责任保险相关险种的可能性。分析了药源性损害的内涵和现状,在此基础上,对发展相关责任保险提出了框架性建议,并对保险期限、责任限定、保险金给付等关键问题进行了讨论。认为相关责任保险的开展有利于保障患者权益,促进社会福利,开展过程中还存在一些问题,可以通过政府推动、完善医疗体系、完善数据上报制度、建立药品追溯数据库等加以解决。     

我国环境污染责任保险试点及相关问题探析

我国自2008年开始启动的环境污染责任保险,目前仍在积极推进中。保险公司单独开发了环境污染责任保险险种,在三大行业先期推出试点,在政策性船舶污染责任保险方面取得突破,基本形成政府推动、市场运作模式。为了充分发挥环境污染责任保险的经济补偿和社会管理功能,本文在分析环境污染责任保险的理论基础和国外经营实践的基础上,就推广环境污染责任保险提出几点建议:一是要乘势而上,顺势而为,提高承保能力,提升管理水平;二是有针对性地开展环境污染责任保险对外宣传活动;三是联合政府职能部门,积极推进环境污染责任保险立法进程。     

机动车交通事故共同侵权损害赔偿中的保险责任研究

机动车交通事故共同侵权行为表现为意思关联型和行为关联型两种。在两辆以上的投保机动车发生交通事故共同侵权时,若干保险公司的赔偿责任怎么承担?较为合理的思路是:多家保险公司在责任限额内对一个受害人承担赔偿责任时,要遵循比例责任和有限连带的一般规则,以实现以人为本、损害补偿的侵权责任法的价值追求。     

论劳动基准法中用人单位的惩罚性赔偿责任

劳动基准具有公私法交融的社会法品格,其义务主体为用人单位,其权利主体则有国家和劳动者。当用人单位违反劳动基准义务,不仅应承担对国家的公法中的责任,还应承担对劳动者的私法中的责任。为追求实质公平、建立正确的利益导向机制以及构建与劳动基准法相匹配的责任制度,有必要在劳动基准法中引入惩罚性赔偿制度     

环境责任保险在环境保护中的经济优势及依存条件分析

环境责任保险是一种运用现代保险制度解决环境问题的经济政策,在众多的环境保护措施中,环境责任保险凭借自身的经济优势得到了人们越来越多的关注和重视。本文在深入剖析其经济优势的基础上详细阐述了环境责任保险的依存条件,以期推动环境责任保险在我国能够顺利发展,并在环境保护中发挥重要作用。     

侵权立法对责任保险市场的影响机制

责任保险赖以存在及发展的基础在于完善的法律体系,尤其是侵权责任法.一国侵权责任法的不断完善,不仅有利于公民和法人承担责任,同时也会增加公众的维权和自我保护意识,从而刺激责任保险市场的需求与供给.本文采用CHH模型,通过侵权责任扩张与责任保险危机问题,分析了侵权立法对责任保险市场的影响机制,并基于美国责任保险市场发展模式...     

环境污染责任保险供需不足成因及解决策略

环境污染责任保险利于社会建设,但在开展中存在供需不足。本文基于西方经济学原理,分析得出此问题的深层原因为环境污染责任保险供需主体具选择倾向:在无外界干预下,需求主体污染企业的生产经营具有外部不经济性,易致此险种需求不足;供给主体保险公司承保此险种具有外部经济性,易致供给不足。通过分析我国现状和比较国外的经验,提出完善环保法律、提供财政支持、完善原保险和再保险市场及组建相互保险公司的策略。     

Optimism and auditor liability

There is strong evidence that individuals are optimistic in the sense that they underrate the probability of a negative event occurring. This paper provides a positive theoretical analysis of how auditor optimism affects their incentives to take care under two liability rules: strict liability and a negligence rule. Under strict liability, auditors are held liable when they cause damages to investors. Under a negligence rule, auditors are held liable when they cause damages and in addition, act negligently, that is, fail to meet the standard of due care specified in legal and professional rules. I find the following results. (1) If due care is sufficiently close to the efficient level, a negligence rule distorts auditors’ incentives less than strict liability. Under strict liability, optimism makes the auditor overestimate the chances of finding material mistakes and thus induces suboptimal care. (2) If due care is too strict, the auditor will not exert due care but the same level of suboptimal care under either liability rule. (3) With increasing optimism and in the absence of punitive damages, strict liability becomes less preferable to a precise negligence rule. This statement also holds for vaguely defined standards of due care if due care is sufficiently strict or if auditor optimism is sufficiently high. (4) Punitive damages counteract suboptimal incentives generated by auditor optimism, especially under strict liability.     

Dividend decisions in the property and liability insurance industry: mutual versus stock companies

This article examines the effect of organizational forms on corporate dividend decisions by exploring the differences in dividend payout ratios between mutual and stock property–liability (P–L) insurers in the US. Our large sample evidence suggests: (1) mutual insurers tend to have a lower dividend payout ratio than stock insurers and the observed difference is about 4% points, holding other factors constant; (2) mutual insurers tend to adjust dividend payout ratios toward their long-run target levels more slowly than stock firms. These results are consistent with the capital constraints and/or greater agency costs of equity in mutual insurers.

论交强险经营模式与道路救助基金职能

随着交强险社会风险管理功能的不断提高,其面临的挑战愈加清晰。本文分析了我国交强险经营的特殊模式及实现不盈不亏的现实障碍,认为以剔除利润因子、微调费率的方式追求不盈不亏,容易使费率调整频繁,加大交强险经营波动性。并通过分析借鉴台湾公办民营模式及盈亏调节机制,建议我国交强险应该采取公办民营模式下允许微盈的经营模式,同时采取业务费用上限和特别准备金作为微观主体的盈亏调剂机制,并创造性地提出以灵活调整道路救助基金提取比例作为交强险行业层面调剂机制,在此基础上,建议实施地区差异费率、补充道路救助基金来源、健全经营主体退出机制。     

Directors' and officers' liability insurance and acquisition outcomes

We examine the effect of directors' and officers' liability insurance (D&O insurance) on the outcomes of merger and acquisition (M&A) decisions. We find that acquirers whose executives have a higher level of D&O insurance coverage experience significantly lower announcement-period abnormal stock returns. Further analyses suggest that acquirers with a higher level of D&O insurance protection tend to pay higher acquisition premiums and their acquisitions appear to exhibit lower synergies. The evidence provides support for the notion that the provision of D&O insurance can induce unintended moral hazard by shielding directors and officers from the discipline of shareholder litigation.     

Directors' and officers' liability insurance and loan spreads

We analyze the effect of directors' and officers' liability insurance (D&O insurance) on the spreads charged on bank loans. We find that higher levels of D&O insurance coverage are associated with higher loan spreads and that this relation depends on loan characteristics in economically sensible ways and is attenuated by monitoring mechanisms. This association between loan spreads and D&O insurance coverage is robust to controlling for endogeneity (because both could be related to firm risk). Our evidence suggests that lenders view D&O insurance coverage as increasing credit risk (potentially via moral hazard or information asymmetry). Further analyses show that higher levels of D&O insurance coverage are associated with greater risk taking and higher probabilities of financial restatement due to aggressive financial reporting. While greater use of D&O insurance increases the cost of debt, we find some evidence that D&O insurance coverage appears to improve the value of large increases in capital expenditure for firms with better internal and external governance.     

Medicaid and long‐term care: The effects of penalizing strategic asset transfers

Medicaid provides a critical source of insurance for long‐term care, and individuals may strategically offload assets (typically to children) to meet the means‐tested eligibility requirement. In this article, we quantify the extent of such behavior using variation in the penalty for improper parent‐to‐child transfers induced by the Deficit Reduction Act of 2005. We estimate difference‐in‐differences models based on the hypothesis that only individuals with high levels of nursing home risk (high risk) will alter transfers because of the Act. We find that over a 2‐year horizon, high‐risk individuals reduced transfers to children on the extensive margin by 11 percent and that the average total amount of transfers decreased by $4,860. The results hold only for coupled respondents. We also conduct a triple‐differences analysis to examine heterogeneity with financial literacy and find that even those with a low level of financial literacy responded to the penalty.     

Insolvency law reform in Australia and Singapore: Directors' liability for insolvent trading and wrongful trading

This article compares reforms to directors' liability for insolvent trading in Singapore and in Australia. We analyse the law in these two countries because they are important Asia‐Pacific trading partners and their laws were originally largely the same—Singapore's law on insolvent trading reflected the law in Australia from the 1960s. However, the law in the two countries has now diverged substantially. The comparison of these two countries therefore represents an interesting case study in how countries differ in their approaches to balancing the competing interests evident in laws that impose personal liability on company directors for insolvent trading. Reform of the prohibition against insolvent trading was a focus of Australia's insolvency law reforms in 2017, which led to the introduction of a safe harbour for directors from liability. Singapore's omnibus insolvency law reforms of 2018–19 include amendments to update Singapore's fraudulent and insolvent trading provisions by introducing a concept of “wrongful trading.” The article finds that there are some areas of convergence between these two jurisdictions when it comes to debates about such provisions but concludes that the different contemporary legislative histories in Australia and Singapore have affected their approaches to reform. Reformers in both jurisdictions have attempted to find an appropriate balance between protecting creditors, discouraging director misconduct, and encouraging entrepreneurship and innovation; however, this comparison suggests that the weight that reformers place on creditor protection compared with the concern that excessive personal liability can make directors unduly risk‐averse is influenced by their existing legislative framework and experience of those laws. Although Australia has shifted away from a strict focus on creditor protection, to give directors more opportunities to engage in restructuring, Singapore's amendments may provide a more creditor‐friendly regime.     

Director and officer liability and corporate tax avoidance

We use the unique nature of the director and officer liability protection law applicable to Nevada incorporated firms to study how liability protection is related to corporate tax avoidance. We find that firms incorporated in Nevada avoid 32% more federal corporate tax as a fraction of total assets than firms incorporated in Delaware, and 40% more than firms incorporated in other states. Nevada-incorporated firms have a 15% lower cash effective tax rate and an 8% lower GAAP ETR. The results are robust to various specifications including instrumental variable and matching approaches. Greater tax avoidance is also associated with lower payouts to shareholders for Nevada-incorporated firms. The findings are consistent with theories about the complementarity of managerial diversion and tax avoidance for firms with poor monitoring, and they demonstrate how increases in liability protection lead to the unintended consequence of greater firm tax avoidance.     

Third-party auditor liability and financial restatements

We examine whether U.S. state-level third-party auditor liability (TPAL) regimes affect firms' financial restatement decisions. Using a sample of 34,409 firm-year observations from 2003 to 2018, we find that state-level TPAL is significantly negatively related to the likelihood of firm-level financial restatements. We also observe that the negative relationship between TPAL and financial restatements persists for a subsample of firms with income-increasing financial restatements and the ‘restatement of torts standard’ (one of the more expansive subgroups of TPAL). Using a difference-in-differences regression design, we find that an increase in state-level TPAL regimes strengthens the negative relationship between TPAL and the incidence of restatements. Our main finding remains robust across several sensitivity tests. Finally, we find that the negative relationship between TPAL and restatements is more pronounced when firms are subject to greater litigation risk and when firms are audited by non-specialist auditors. Overall, we show that TPAL has important implications for client firms' financial restatements.