Firm specific factors that determine insurance companies’ performance in ethiopia
Daniel Mehari,Tilahun Aemiro +1 more
TLDR
In this paper, the authors investigated the impact of firm level characteristics (size, leverage, tangibility, loss ratio (risk), growth in writing premium, liquidity, leverage and loss ratio) on performance of insurance companies in Ethiopia.Abstract:
The performance of any business firm not only plays the role to improve the market value of that specific firm but also leads towards the growth of the whole sector which ultimately leads towards the overall prosperity of the economy Assessing the determinants of the performance of organizations has gained importance in the corporate finance literature; however, in the context of insurance sector, it has received little attention particularly in Ethiopia Accordingly, this study investigated the impact of firm level characteristics (size, leverage, tangibility, Loss ratio (risk), growth in writing premium, liquidity and age) on performance of insurance companies in Ethiopia Return on total assets (ROA) - a key indicator of insurance company's performance- is used as dependent variable while age of company, size of the company, growth in writing premium, liquidity, leverage and loss ratio are independent variables The sample includes 9 insurance companies over the period 2005-2010 The audited annual reports (Balance sheet and Profit/Loss account) of insurance companies were obtained from National Bank of Ethiopia (NBE) and insurance companies’ annual publication reports The results of regression analysis reveal that insurers’ size, tangibility and leverage are statistically significant and positively related with return on total asset; however, loss ratio (risk) is statistically significant and negatively related with ROA Thus, insurers’ size, Loss ratio (risk), tangibility and leverage are important determinants of performance of insurance companies in Ethiopia But, growth in writing premium, insurers’ age and liquidity have statistically insignificant relationship with ROAread more
Citations
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Determinants of Insurance Firms' Profitability: An Empirical Study of Saudi Insurance Market
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The Determinants of Profitability of Insurance Companies in Palestine
Islam Abdeljawad,Layth Dwaikat +1 more
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Türki̇ye'de hayat si̇gortasi şi̇rketleri̇ni̇n fi̇nansal performansini beli̇rleyen fi̇rmaya özgü faktörler: panel veri̇ anali̇zi̇
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TL;DR: Finansal performansi etkileyen firmaya ozgu faktorlerin belirlenmesi ve bu fakterler ile performans arasindaki iliskinin tespit edilmesi amaciyla, 2008-2013 doneminde, Turkiye’de faaliyet gosteren 17 hayat sigortasi sirketinin verileri bir araya getirilerek 102 gozlemli bir panel veri seti elde edilmistir.
References
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Eugene F. Fama,Michael C. Jensen +1 more
TL;DR: Jensen and Fama as mentioned in this paper developed a set of propositions that explaim the special features of the residual claims of different organizational forms as efficient approaches to controlling agency problems and explained the survival of organizational forms in specific activities.
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TL;DR: In this paper, the authors examined the impact of an insurer's level of insolvency risk on the prices the insurer obtains for its products in the property-liability insurance market.
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