ACCOUNTING AND FINANCIAL PERFORMANCE OF INSURANCE COMPANIES IN BRAZIL: A STUDY BASED ON THE DATA ENVELOPMENT ANALYSIS (DEA) FOR THE YEAR OF 2007

The goal of this article is to analyze the accounti ng and financial performance of insurance companies operating in Brazil during the year of 20 07, through the use of Data Envelopment Analysis (DEA). For this, were used accounting and fi ancial information available on the 73 largest insurance groups in Brazil from the Conjunt ura Econômica Magazine (2008). The information used in the analysis are derived from a factor analysis applied to the original indexes, forming four factors: profitability, manag ement efficiency (use of operating expenses), claims and risk (use of debt). Based on these four factors the DEA-VRS model was applied to consolidate them into a single indicator of accounting and financial performance called Accounting and Financial Performance Index ( IDCF). The results show that only eight out of the 73 insurance companies examined present maximum performance indicator (IDCF = 100%). These are presumed to be efficient and ser ve as benchmarks for other insurance companies, in the quest for improvement in their pr ofitability, management efficiency, claims and risk indicators. Furthermore, the results show that, even if not incisively, the better the position of the insurance company in relation to th e size, the worse its position is in relation to accounting and financial performance. Finally, w ith 10% level of significance, the average accounting and financial performance of the 15 larg est insurance companies is lower than the average accounting and financial performance of 15 smaller insurance companies. This shows, for this analysis, the condition of competit iveness of small and medium size insurance companies.