Banking sector’s impact on the development of financial risk insurance amid financial market transformation

Abstract

Abstract.The purpose of the study is to theoretically substantiate the impact of the banking sector on the evolution of financial risk insurance in the context of financial market transformation, as well as to identify promising areas for strengthening cooperation between banks and insurers in order to increase financial stability and optimise risk management. To achieve the set goal, a set of well-known scientific methods was used in the course of the study: generalization methods were used to summarize the features of the transformation of the modern financial market, as well as to form conclusions and recommendations; the method of logical synthesis was used to theoretically substantiate the importance of researching methods of managing bank financial risks; the use of analysis and synthesis methods made it possible to demonstrate the need to substantiate directions for improving the mechanisms of cooperation between the banking and insurance sectors; the method of constructing diagrams and models was used to visually present the research results and their schematic interpretation. Results. The features of the transformation of the modern financial market and its impact on changes in the structure and scale of financial risks are summarised. The basic principles of interaction between banks and insurance companies in the field of financial risk minimisation have been identified. The main directions of interaction and cooperation between the banking and insurance sectors have been proposed, taking into account the processes of digitalization and integration of financial markets Conclusions. The study found that digitalisation, globalisation processes, and macroeconomic instability are significantly transforming approaches to financial risk management, leading to deeper integration of the banking and insurance sectors and a transition to comprehensive models of cooperation. Taken together, this contributes to strengthening financial stability, more effective risk distribution, and the formation of a modern customer-oriented model of financial intermediation.