Abstract
We analyse strategic groups in the German insurance market. We use cluster analysis to subdivide insurance groups into strategic groups. Furthermore, we analyse whether strategic group affiliation can affect the performance of the insurance groups’ property-liability subsidiaries. In addition, we examine the consequences of the financial crisis of 2008 on the competitive situation in the German insurance sector and examine whether changes in strategic group affiliation can be considered as a consequence of the financial crisis. Using a data set of 829 firm-year observations for the years 2004–2012, our results indicate the existence of three strategic group in the German insurance sector. In addition, we find that performance differences at the subsidiary level can be attributed to strategic group affiliation. Furthermore, we do not find evidence that the financial crisis induced changes in strategic group affiliation.
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