Pub Date : 2024-07-26DOI: 10.21511/ins.15(1).2024.07
K. S. Druva Kumar, Senthil Kumar J. P.
Data Envelopment Analysis is a crucial tool for evaluating the performance of insurance companies, considering its ability to handle multiple inputs and outputs. This study provides a comprehensive bibliometric analysis of Data Envelopment Analysis (DEA) application in the insurance industry from 2010 to 2023, examining 405 documents from 432 sources. Materials from academic databases (Web of Science and Scopus) were used for the analysis. The methodological flow included three stages. For analysis, two sets of keywords were identified: one set oriented toward DEA and the other tailored to the Insurance Industry domain. To analyze and visualize the data, VOSviewer software, version 1.6.19, and RSTUDIO were used. This paper highlights the evolution of DEA methodologies, incorporating advanced techniques like Artificial Intelligence and Machine Learning, and addresses emerging trends such as digital transformation, customer-centric assessments, and sustainability. The analysis reveals significant geographical and sectoral differences in efficiency assessments, with higher efficiency levels typically found in developed markets such as North America and Europe compared to emerging markets in Asia and Africa. It also notes the distinctive efficiency patterns between life and non-life insurance firms, influenced by product complexity and market competition. The findings indicate that DEA remains versatile and essential for performance evaluation in the insurance industry, adapting to challenges through methodological advancements.
数据包络分析法能够处理多种输入和输出，是评估保险公司绩效的重要工具。本研究对 2010 年至 2023 年数据包络分析法（DEA）在保险行业的应用进行了全面的文献计量分析，研究了 432 个来源的 405 篇文献。分析使用了学术数据库（Web of Science 和 Scopus）中的资料。方法流程包括三个阶段。为进行分析，确定了两组关键词：一组以 DEA 为导向，另一组则针对保险业领域。为了对数据进行分析和可视化，使用了 VOSviewer 软件 1.6.19 版和 RSTUDIO。本文重点介绍了 DEA 方法的演变，将人工智能和机器学习等先进技术融入其中，并探讨了数字化转型、以客户为中心的评估和可持续发展等新兴趋势。分析显示，效率评估在地域和行业方面存在显著差异，与亚洲和非洲的新兴市场相比，北美和欧洲等发达市场的效率水平通常更高。分析还注意到，受产品复杂性和市场竞争的影响，寿险公司和非寿险公司的效率模式各不相同。研究结果表明，DEA 仍是保险业业绩评估的多面手和必备工具，可通过方法的进步来应对挑战。
{"title":"Efficiency assessment and trends in the insurance industry: A bibliometric analysis of DEA application","authors":"K. S. Druva Kumar, Senthil Kumar J. P.","doi":"10.21511/ins.15(1).2024.07","DOIUrl":"https://doi.org/10.21511/ins.15(1).2024.07","url":null,"abstract":"Data Envelopment Analysis is a crucial tool for evaluating the performance of insurance companies, considering its ability to handle multiple inputs and outputs. This study provides a comprehensive bibliometric analysis of Data Envelopment Analysis (DEA) application in the insurance industry from 2010 to 2023, examining 405 documents from 432 sources. Materials from academic databases (Web of Science and Scopus) were used for the analysis. The methodological flow included three stages. For analysis, two sets of keywords were identified: one set oriented toward DEA and the other tailored to the Insurance Industry domain. To analyze and visualize the data, VOSviewer software, version 1.6.19, and RSTUDIO were used. This paper highlights the evolution of DEA methodologies, incorporating advanced techniques like Artificial Intelligence and Machine Learning, and addresses emerging trends such as digital transformation, customer-centric assessments, and sustainability. The analysis reveals significant geographical and sectoral differences in efficiency assessments, with higher efficiency levels typically found in developed markets such as North America and Europe compared to emerging markets in Asia and Africa. It also notes the distinctive efficiency patterns between life and non-life insurance firms, influenced by product complexity and market competition. The findings indicate that DEA remains versatile and essential for performance evaluation in the insurance industry, adapting to challenges through methodological advancements.","PeriodicalId":32827,"journal":{"name":"Insurance Markets and Companies","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2024-07-26","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"141800567","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-07-25DOI: 10.21511/ins.15(1).2024.06
Ajetunmobi Ololade A., A. Adefulu, Makinde Grace Olubisi, Nwankwere Idowu
The insurance industry contributes to the smooth running of the economy. Unfortunately, not every country develops insurance at a high level; that is, the level of insurance penetration is low. This is happening in Nigeria. Therefore, this study aims to establish the effect of competitive positioning on the market share of selected insurance companies in Lagos State, Nigeria. The study adopts a survey research design. A structured instrument was used for data collection using the modified six-point Likert-type scale. The questionnaire was divided into three sections (about respondents’ demographic factors, competitive positioning, and market share). The population was 2,183 management-level employees from the 20 selected insurance companies. The sample size of 507 was determined using stratified random sampling and proportionate method. Test-retest method was used to validate the instrument, while the reliability was determined through internal consistency method. The Cronbach Alpha coefficients ranged from 0.71 to 0.88. Response rate of 86.7% was achieved. Descriptive and inferential statistics were used for analysis. Findings reveal that competitive positioning components have a significant effect on market share (Adj.R2 = 0.194, F(5. 434) = 22.097, p < 0.05). The results demonstrate that if all the competitive positioning components were set to zero, the market share of selected insurance companies in Lagos State would be 6.537, which is a positive value. Thus, competitive positioning components significantly affect market share. As a result, this study found that insurers would benefit from increasing their focus on developing the strategic asset and research and development aspects of competitive positioning to expand their market share. Acknowledgments The researchers acknowledge the contributions of the anonymous reviewers for the useful comments in making the article better. We acknowledge the management of the University that made it mandatory for the supervisee to publish two articles from their thesis, one in the name of the supervisor as the lead author, while another in the name of the supervisee as the lead author. The research assistants are acknowledged for the cooperation during the field work and the management of the insurance companies engaged for the study. The inputs of the supervisors are greatly acknowledged.
{"title":"Competitive positioning and market share of selected insurance companies: case of Nigeria","authors":"Ajetunmobi Ololade A., A. Adefulu, Makinde Grace Olubisi, Nwankwere Idowu","doi":"10.21511/ins.15(1).2024.06","DOIUrl":"https://doi.org/10.21511/ins.15(1).2024.06","url":null,"abstract":"The insurance industry contributes to the smooth running of the economy. Unfortunately, not every country develops insurance at a high level; that is, the level of insurance penetration is low. This is happening in Nigeria. Therefore, this study aims to establish the effect of competitive positioning on the market share of selected insurance companies in Lagos State, Nigeria. The study adopts a survey research design. A structured instrument was used for data collection using the modified six-point Likert-type scale. The questionnaire was divided into three sections (about respondents’ demographic factors, competitive positioning, and market share). The population was 2,183 management-level employees from the 20 selected insurance companies. The sample size of 507 was determined using stratified random sampling and proportionate method. Test-retest method was used to validate the instrument, while the reliability was determined through internal consistency method. The Cronbach Alpha coefficients ranged from 0.71 to 0.88. Response rate of 86.7% was achieved. Descriptive and inferential statistics were used for analysis. Findings reveal that competitive positioning components have a significant effect on market share (Adj.R2 = 0.194, F(5. 434) = 22.097, p < 0.05). The results demonstrate that if all the competitive positioning components were set to zero, the market share of selected insurance companies in Lagos State would be 6.537, which is a positive value. Thus, competitive positioning components significantly affect market share. As a result, this study found that insurers would benefit from increasing their focus on developing the strategic asset and research and development aspects of competitive positioning to expand their market share.\u0000Acknowledgments The researchers acknowledge the contributions of the anonymous reviewers for the useful comments in making the article better. We acknowledge the management of the University that made it mandatory for the supervisee to publish two articles from their thesis, one in the name of the supervisor as the lead author, while another in the name of the supervisee as the lead author. The research assistants are acknowledged for the cooperation during the field work and the management of the insurance companies engaged for the study. The inputs of the supervisors are greatly acknowledged.","PeriodicalId":32827,"journal":{"name":"Insurance Markets and Companies","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2024-07-25","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"141806286","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-06-03DOI: 10.21511/ins.15(1).2024.05
Alhareth Mohammed Abu Hussein, Al Montaser Mohammad, Sanaa Suliman, Ibrahim Mkheimer
The study intends to determine how leadership techniques adjusted to the trends impact employee job satisfaction, considering the mediating influence of perceived organizational politics in light of the expanding influence of digital technology and virtual work settings. The study included a solid sample of 300 workers from different parts of Jordan. The employees filled out the questionnaire anonymously. 5-point rating Likert scales were used to capture a range of viewpoints. Using the Partial Least Squares software, this study applies Structural Equation Modelling analysis to examine the relationships between job satisfaction, perceived organizational politics, and leadership styles in Jordanian insurance companies. The study focuses on all employees of insurance companies in Jordan, including people working at various administrative levels. The most common length of job tenure was between one and five years (38.67%). Initial results show a strong beneficial relationship between transformational leadership philosophies and contentment at work (β = 0. 378, t = 6.266, LL = 0.483, UL = 0.718, p < 0.001). Similarly, transformational leadership had the highest standardized effect on perceived organizational politics with a coefficient of 0.443. Furthermore, the complex processes by which leadership philosophies tangentially affect job satisfaction levels are revealed by the role of mediation of perceived organizational politics.
{"title":"Leadership in the digital era: Exploring the nexus between leadership styles and job satisfaction. The mediating role of perceived organizational politics in Jordanian insurance companies","authors":"Alhareth Mohammed Abu Hussein, Al Montaser Mohammad, Sanaa Suliman, Ibrahim Mkheimer","doi":"10.21511/ins.15(1).2024.05","DOIUrl":"https://doi.org/10.21511/ins.15(1).2024.05","url":null,"abstract":"The study intends to determine how leadership techniques adjusted to the trends impact employee job satisfaction, considering the mediating influence of perceived organizational politics in light of the expanding influence of digital technology and virtual work settings. The study included a solid sample of 300 workers from different parts of Jordan. The employees filled out the questionnaire anonymously. 5-point rating Likert scales were used to capture a range of viewpoints. Using the Partial Least Squares software, this study applies Structural Equation Modelling analysis to examine the relationships between job satisfaction, perceived organizational politics, and leadership styles in Jordanian insurance companies. The study focuses on all employees of insurance companies in Jordan, including people working at various administrative levels. The most common length of job tenure was between one and five years (38.67%). Initial results show a strong beneficial relationship between transformational leadership philosophies and contentment at work (β = 0. 378, t = 6.266, LL = 0.483, UL = 0.718, p < 0.001). Similarly, transformational leadership had the highest standardized effect on perceived organizational politics with a coefficient of 0.443. Furthermore, the complex processes by which leadership philosophies tangentially affect job satisfaction levels are revealed by the role of mediation of perceived organizational politics.","PeriodicalId":32827,"journal":{"name":"Insurance Markets and Companies","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2024-06-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"141271401","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Nepal’s non-life insurance sector holds immense potential to drive economic growth and boost the nation towards a secure financial future. Embracing this potential is a goal and a pivotal catalyst for substantial change. The study aims to determine how the non-life insurance sector can drive economic growth in Nepal. The methodology of this study uses quantitative analysis of financial data from 2013 to 2022 from 20 non-life insurance companies in Nepal and econometric modeling to assess the sector’s impact on economic growth. Using Panel EGLS (Estimated Generalized Least Squares) regression analysis, the findings show that with one-unit increments in total investment, total premium, and total tax paid, GDP is expected to change by approximately 591.52, –920.54 and 8,470.65 units, respectively. In contrast, the coefficient for total profit is –910.3477 and is not statistically significant. The study’s main conclusion implies that the insurance sector contributes to the country’s economic growth by investing in productive activities and paying taxes to the government. Still, it also imposes a cost on the economy by charging high premiums to the insured. The profitability of the insurance sector does not affect the GDP, which indicates that the insurance sector is competitive and efficient or that other factors determine the GDP besides the insurance sector. This study contributes to a deeper understanding of the non-life insurance sector’s role in Nepal’s economic development and informs evidence-based policy decisions.
{"title":"Contribution of the non-life insurance sector to the economic growth of Nepal: Analysis from the EGLS approach","authors":"Yadav Mani Upadhyaya, Khom Raj Kharel, Narayan Prasad Aryal, Basu Dev Lamichhane","doi":"10.21511/ins.15(1).2024.03","DOIUrl":"https://doi.org/10.21511/ins.15(1).2024.03","url":null,"abstract":"Nepal’s non-life insurance sector holds immense potential to drive economic growth and boost the nation towards a secure financial future. Embracing this potential is a goal and a pivotal catalyst for substantial change. The study aims to determine how the non-life insurance sector can drive economic growth in Nepal. The methodology of this study uses quantitative analysis of financial data from 2013 to 2022 from 20 non-life insurance companies in Nepal and econometric modeling to assess the sector’s impact on economic growth. Using Panel EGLS (Estimated Generalized Least Squares) regression analysis, the findings show that with one-unit increments in total investment, total premium, and total tax paid, GDP is expected to change by approximately 591.52, –920.54 and 8,470.65 units, respectively. In contrast, the coefficient for total profit is –910.3477 and is not statistically significant. The study’s main conclusion implies that the insurance sector contributes to the country’s economic growth by investing in productive activities and paying taxes to the government. Still, it also imposes a cost on the economy by charging high premiums to the insured. The profitability of the insurance sector does not affect the GDP, which indicates that the insurance sector is competitive and efficient or that other factors determine the GDP besides the insurance sector. This study contributes to a deeper understanding of the non-life insurance sector’s role in Nepal’s economic development and informs evidence-based policy decisions.","PeriodicalId":32827,"journal":{"name":"Insurance Markets and Companies","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2024-03-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140238993","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-02-27DOI: 10.21511/ins.15(1).2024.02
Shorouq Fathi Eletter
Blockchain technology has surfaced as a formidable catalyst, capable of reshaping the operational dynamics of conventional businesses. The integration of blockchain technology within the insurance industry has prompted a need for comprehensive understanding and assessment. This study aims to elucidate the relevance of blockchain in the insurance sector, identify key trends, influential research, and the overarching goals motivating the incorporation of blockchain in insurance practices. The study employed a systematic review to collect 125 research articles published between 2017 and 2023 focused on blockchain in insurance from the Web of Science database. This study used Biblioshiny. The analysis encompasses a wide range of parameters, including publication trends, influential authors, thematic clusters, and the geographic distribution of research. IEEE Access emerges as a prominent platform, hosting 11 articles dedicated to this topic. The results of keyword co-occurrence highlighted two keywords: blockchain and insurance. The results of the country collaboration map highlighted particular shortcomings, such as the concentration of research in countries like China, the USA, India, KSA, Malaysia, and Australia. A lack of research in developing and underdeveloped countries and insufficient knowledge sharing among researchers highlights a research gap. In conclusion, the analysis offers valuable insights into the evolving landscape of blockchain within the insurance industry.
区块链技术已成为一种强大的催化剂，能够重塑传统企业的运营动态。区块链技术与保险业的融合促使人们需要对其进行全面了解和评估。本研究旨在阐明区块链与保险业的相关性，确定关键趋势、有影响力的研究以及将区块链纳入保险实践的总体目标。本研究采用系统综述的方式，从Web of Science数据库中收集了2017年至2023年间发表的125篇研究文章，重点关注区块链在保险领域的应用。本研究使用了 Biblioshiny。分析涵盖了广泛的参数，包括发表趋势、有影响力的作者、主题集群和研究的地理分布。IEEE Access 是一个突出的平台，有 11 篇文章专门讨论这一主题。关键词共现结果突出了两个关键词：区块链和保险。国家协作图的结果凸显了一些不足之处，例如研究集中在中国、美国、印度、沙特阿拉伯、马来西亚和澳大利亚等国家。发展中国家和欠发达国家缺乏研究，研究人员之间知识共享不足，这些都凸显了研究缺口。总之，该分析为了解区块链在保险行业中的发展状况提供了宝贵的见解。
{"title":"The use of blockchain in the insurance industry: A bibliometric analysis","authors":"Shorouq Fathi Eletter","doi":"10.21511/ins.15(1).2024.02","DOIUrl":"https://doi.org/10.21511/ins.15(1).2024.02","url":null,"abstract":"Blockchain technology has surfaced as a formidable catalyst, capable of reshaping the operational dynamics of conventional businesses. The integration of blockchain technology within the insurance industry has prompted a need for comprehensive understanding and assessment. This study aims to elucidate the relevance of blockchain in the insurance sector, identify key trends, influential research, and the overarching goals motivating the incorporation of blockchain in insurance practices. The study employed a systematic review to collect 125 research articles published between 2017 and 2023 focused on blockchain in insurance from the Web of Science database. This study used Biblioshiny. The analysis encompasses a wide range of parameters, including publication trends, influential authors, thematic clusters, and the geographic distribution of research. IEEE Access emerges as a prominent platform, hosting 11 articles dedicated to this topic. The results of keyword co-occurrence highlighted two keywords: blockchain and insurance. The results of the country collaboration map highlighted particular shortcomings, such as the concentration of research in countries like China, the USA, India, KSA, Malaysia, and Australia. A lack of research in developing and underdeveloped countries and insufficient knowledge sharing among researchers highlights a research gap. In conclusion, the analysis offers valuable insights into the evolving landscape of blockchain within the insurance industry.","PeriodicalId":32827,"journal":{"name":"Insurance Markets and Companies","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2024-02-27","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140423765","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-12-29DOI: 10.21511/ins.14(1).2023.13
Ján Užík, Olha Yeremenko, Natalia Sidelnyk, Tetyana Koriahinа, M. Mormul
The paper examines, using the example of Ukraine from 2003 to 2020, how and to what extent the development of various segments of the insurance market (risk insurance, life insurance, and reinsurance) influences the overall level of social progress. It also identifies the time gaps through which this influence manifests. The study creates a single measure that looks at various aspects such as social class differences, spending patterns, income changes, and government social spending (their standardized values, weighed by the principal component method, integrated through additive convolution). Using VAR modeling, the impact of the development indicators of different segments of the insurance market (risk insurance, life insurance, and reinsurance) at the current moment and with lags of one, two, and three years is investigated, as well as the level of social progress in Ukraine in previous years. The modeling confirms that social reforms yield significant results for social progress only after three years, similarly to the increase in the number of insurance companies. Given insurers’ assets and payout levels, their growth in life insurance has a faster impact on social progress than in risk, while the opposite is true for premiums. Insurance premiums transferred to Ukrainian reinsurers negatively and slowly (over three years) affect social progress, and to non-resident reinsurers – positively and faster (within a year). Across most indicators, life insurance not only influences Ukraine’s social progress more quickly than others but also provides a more substantial social effect.
本文以 2003 年至 2020 年的乌克兰为例，探讨了保险市场各个环节（风险保险、人寿保险和再保险）的发展如何以及在多大程度上影响了社会进步的总体水平。研究还确定了这种影响的时间差。该研究建立了一个单一的衡量标准，对社会阶层差异、支出模式、收入变化和政府社会支出（其标准化值通过主成分法进行权衡，并通过加法卷积法进行整合）等各个方面进行考察。通过 VAR 模型，研究了保险市场不同部分（风险保险、人寿保险和再保险）的发展指标在当前和滞后一年、两年和三年的影响，以及乌克兰前几年的社会进步水平。模型证实，社会改革只有在三年后才会对社会进步产生重大影响，这与保险公司数量的增加情况类似。考虑到保险公司的资产和赔付水平，其寿险业务的增长对社会进步的影响快于风险业务，而保费的增长则相反。转给乌克兰再保险公司的保险费对社会进步的影响是负面的、缓慢的（超过三年），而转给非居民再保险公司的保险费对社会进步的影响是正面的、较快的（在一年内）。在大多数指标中，人寿保险不仅比其他保险更快地影响乌克兰的社会进步，而且还提供了更大的社会效应。
{"title":"Time gap of the impact of risk insurance, life insurance and reinsurance on social progress: The case of Ukraine","authors":"Ján Užík, Olha Yeremenko, Natalia Sidelnyk, Tetyana Koriahinа, M. Mormul","doi":"10.21511/ins.14(1).2023.13","DOIUrl":"https://doi.org/10.21511/ins.14(1).2023.13","url":null,"abstract":"The paper examines, using the example of Ukraine from 2003 to 2020, how and to what extent the development of various segments of the insurance market (risk insurance, life insurance, and reinsurance) influences the overall level of social progress. It also identifies the time gaps through which this influence manifests. The study creates a single measure that looks at various aspects such as social class differences, spending patterns, income changes, and government social spending (their standardized values, weighed by the principal component method, integrated through additive convolution). Using VAR modeling, the impact of the development indicators of different segments of the insurance market (risk insurance, life insurance, and reinsurance) at the current moment and with lags of one, two, and three years is investigated, as well as the level of social progress in Ukraine in previous years. The modeling confirms that social reforms yield significant results for social progress only after three years, similarly to the increase in the number of insurance companies. Given insurers’ assets and payout levels, their growth in life insurance has a faster impact on social progress than in risk, while the opposite is true for premiums. Insurance premiums transferred to Ukrainian reinsurers negatively and slowly (over three years) affect social progress, and to non-resident reinsurers – positively and faster (within a year). Across most indicators, life insurance not only influences Ukraine’s social progress more quickly than others but also provides a more substantial social effect.","PeriodicalId":32827,"journal":{"name":"Insurance Markets and Companies","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-12-29","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139142255","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-12-08DOI: 10.21511/ins.15(1).2024.01
Thabiso Sthembiso Msomi
This research paper examines the correlation between underwriting profit factors and the overall profitability of publicly traded general insurance companies operating in South Africa. The study analyzed a sample of 36 insurers, considering their quantifiable markets and accessible financial data from 2008 to 2019. Employing signal correlation analysis, the investigation explored the associations between various financial indicators and Return on Assets (ROA). The results revealed negative correlations between ROA and the logarithms of total investment (TI), shareholder funds (SF), and underwriting profits (UWP), with correlation coefficients of –0.4500, –0.3365, and –0.4050, respectively. These findings indicate that as TI, SF, and UWP increase, there is a tendency for ROA to decrease for general insurance companies in South Africa. Furthermore, a positive relationship was observed between the earning-asset ratio and ROA. This suggests that as the earning-asset ratio rises, the ROA of general insurance firms in South Africa tends to improve, indicating a potentially favorable impact on profitability. The significant findings of this study emphasize the importance of prioritizing effective risk management practices within insurance firms. By implementing these measures, such as minimizing the likelihood of claims and ensuring accurate reflection of assumed risks in premium charges, insurance companies can maintain positive underwriting profit. This, in turn, has the potential to enhance their overall profitability.
{"title":"Do underwriting profit factors affect general insurance firms’ profitability in South Africa?","authors":"Thabiso Sthembiso Msomi","doi":"10.21511/ins.15(1).2024.01","DOIUrl":"https://doi.org/10.21511/ins.15(1).2024.01","url":null,"abstract":"This research paper examines the correlation between underwriting profit factors and the overall profitability of publicly traded general insurance companies operating in South Africa. The study analyzed a sample of 36 insurers, considering their quantifiable markets and accessible financial data from 2008 to 2019. Employing signal correlation analysis, the investigation explored the associations between various financial indicators and Return on Assets (ROA). The results revealed negative correlations between ROA and the logarithms of total investment (TI), shareholder funds (SF), and underwriting profits (UWP), with correlation coefficients of –0.4500, –0.3365, and –0.4050, respectively. These findings indicate that as TI, SF, and UWP increase, there is a tendency for ROA to decrease for general insurance companies in South Africa. Furthermore, a positive relationship was observed between the earning-asset ratio and ROA. This suggests that as the earning-asset ratio rises, the ROA of general insurance firms in South Africa tends to improve, indicating a potentially favorable impact on profitability. The significant findings of this study emphasize the importance of prioritizing effective risk management practices within insurance firms. By implementing these measures, such as minimizing the likelihood of claims and ensuring accurate reflection of assumed risks in premium charges, insurance companies can maintain positive underwriting profit. This, in turn, has the potential to enhance their overall profitability.","PeriodicalId":32827,"journal":{"name":"Insurance Markets and Companies","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-12-08","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"138588932","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-12-08DOI: 10.21511/ins.14(1).2023.11
Omonike Ige-Gbadeyan, Matthys Johannes Swanepoel
This study aimed to determine the effect of operational efficiency on financial health of non-life insurance companies in South Africa. Operational efficiency refers to an insurer’s ability to deliver its services while minimizing costs and maximizing profitability. A descriptive research design was used to achieve the objective of this study. The panel data from 2008–2019 used secondary data sourced from S&P Capital Q and Refinitiv Eikon, well-known databases with readily available data. The population of this study focuses on 32 non-life insurance companies with measurable markets of 57 domestic non-life insurance providers in South Africa. Data were analyzed using Fixed-effect regression, (Random-effect GLS regression, correlation, and the Hausman test. The result reveals that of all the variables, only premium growth correlates significantly (negative correlation) with financial health. This could be a result of a specific investment that resulted in a lower rate than that of a risk-free security. It is also important to note that a negative premium does not always indicate a problem. This can happen due to cancellations of reinsurance, reinsurer closures, paid off reinsurance ahead of time, under- pricing policies, inadequate reserves, high claim frequency, operational inefficiencies, investment losses, inadequate risk assessment, economic downturn, regulatory changes, catastrophic event, and any other events. It is essential for non-life insurance companies to carefully manage their underwriting practices, risk assessment, pricing strategies, and investment portfolios to avoid negative premium situations and maintain financial health.
{"title":"Determinants of operational efficiency on the financial health of non-life insurance companies in South Africa","authors":"Omonike Ige-Gbadeyan, Matthys Johannes Swanepoel","doi":"10.21511/ins.14(1).2023.11","DOIUrl":"https://doi.org/10.21511/ins.14(1).2023.11","url":null,"abstract":"This study aimed to determine the effect of operational efficiency on financial health of non-life insurance companies in South Africa. Operational efficiency refers to an insurer’s ability to deliver its services while minimizing costs and maximizing profitability. A descriptive research design was used to achieve the objective of this study. The panel data from 2008–2019 used secondary data sourced from S&P Capital Q and Refinitiv Eikon, well-known databases with readily available data. The population of this study focuses on 32 non-life insurance companies with measurable markets of 57 domestic non-life insurance providers in South Africa. Data were analyzed using Fixed-effect regression, (Random-effect GLS regression, correlation, and the Hausman test. The result reveals that of all the variables, only premium growth correlates significantly (negative correlation) with financial health. This could be a result of a specific investment that resulted in a lower rate than that of a risk-free security. It is also important to note that a negative premium does not always indicate a problem. This can happen due to cancellations of reinsurance, reinsurer closures, paid off reinsurance ahead of time, under- pricing policies, inadequate reserves, high claim frequency, operational inefficiencies, investment losses, inadequate risk assessment, economic downturn, regulatory changes, catastrophic event, and any other events. It is essential for non-life insurance companies to carefully manage their underwriting practices, risk assessment, pricing strategies, and investment portfolios to avoid negative premium situations and maintain financial health.","PeriodicalId":32827,"journal":{"name":"Insurance Markets and Companies","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-12-08","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"138587533","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-12-07DOI: 10.21511/ins.14(1).2023.10
S. Athanasiadis, Marek Šulista, Tomáš Mrkvička
The insurance sector is a significant component of the economy and its financial system. Therefore, sound growth and protection of the insurance industry against systemic risks are critical requirements for any country’s social and economic development. The paper analyzes the dependence between insurance demand represented by insurance penetration and various factors from economics, finance, socio-demographics, and institutions. The analysis is conducted within certain clusters of European countries, which are determined by functional clustering analysis concerning the magnitude and shape of the insurance penetration curves. The dependence is analyzed via linear mixed-effect models. The analysis shows significantly different dependencies between the clusters, proving the existence of different conditions for different European insurance markets, especially concerning economic growth, income, financial development, and unemployment. In contrast, interest rates, inflation, urbanization, and education do not play a significant role in these insurance markets. The institutional development seems insignificant for all clusters except for certain economies in transition. The findings imply that there is a need for countries across Europe to identify country-specific determinants of insurance. In that respect, European policymakers and managers can direct specific policies based on the identified determinants’ relationship with insurance, especially in developing countries.
{"title":"Dependence relationship between insurance demand and some economic, financial, and socio-demographic factors: Evidence from different groups of European countries","authors":"S. Athanasiadis, Marek Šulista, Tomáš Mrkvička","doi":"10.21511/ins.14(1).2023.10","DOIUrl":"https://doi.org/10.21511/ins.14(1).2023.10","url":null,"abstract":"The insurance sector is a significant component of the economy and its financial system. Therefore, sound growth and protection of the insurance industry against systemic risks are critical requirements for any country’s social and economic development. The paper analyzes the dependence between insurance demand represented by insurance penetration and various factors from economics, finance, socio-demographics, and institutions. The analysis is conducted within certain clusters of European countries, which are determined by functional clustering analysis concerning the magnitude and shape of the insurance penetration curves. The dependence is analyzed via linear mixed-effect models. The analysis shows significantly different dependencies between the clusters, proving the existence of different conditions for different European insurance markets, especially concerning economic growth, income, financial development, and unemployment. In contrast, interest rates, inflation, urbanization, and education do not play a significant role in these insurance markets. The institutional development seems insignificant for all clusters except for certain economies in transition. The findings imply that there is a need for countries across Europe to identify country-specific determinants of insurance. In that respect, European policymakers and managers can direct specific policies based on the identified determinants’ relationship with insurance, especially in developing countries.","PeriodicalId":32827,"journal":{"name":"Insurance Markets and Companies","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-12-07","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"138593903","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The financial performance of insurance companies plays a fundamental role in driving the overall economy towards economic development and progress. The study aims to examine the impact of financial performance indicators on the Return on Equity (ROE) and Return on Assets (ROA) of nonlife insurance companies. In the methodology of study, 13 nonlife insurance companies have been considered, and panel data have been analyzed for a 14-year period (2008–2021). The fixed effects model was estimated using the E-Views software package. The panel data analysis results point to a noteworthy and favorable impact on ROA, explaining 92.75% of its variance. The results show that there is a strong positive relationship between ROA and four key factors: gross premium, retention ratio, expense ratio, and combined ratio. This underscores the importance of enhancing elements like gross premium, retention ratio, expense ratio, and combined ratio to elevate ROA. The conclusion of the study provides useful insights for improving the financial performance and competitiveness of nonlife insurance companies in Nepal. The study reveals the key success factors that affect the profitability and efficiency of the insurance sector. This suggests that nonlife insurance companies in Nepal can improve their profitability by focusing on increasing their gross premium, retention ratio, reducing expense ratio, and decreasing combined ratio. The findings have important implications for enhancing the performance and competitiveness of the nonlife insurance sector in Nepal.
{"title":"Determinants of financial performance in Nepalese nonlife insurance companies: A panel data analysis","authors":"Yadav Mani Upadhyaya, Rabindra Ghimire, Shiva Raj Ghimire","doi":"10.21511/ins.14(1).2023.09","DOIUrl":"https://doi.org/10.21511/ins.14(1).2023.09","url":null,"abstract":"The financial performance of insurance companies plays a fundamental role in driving the overall economy towards economic development and progress. The study aims to examine the impact of financial performance indicators on the Return on Equity (ROE) and Return on Assets (ROA) of nonlife insurance companies. In the methodology of study, 13 nonlife insurance companies have been considered, and panel data have been analyzed for a 14-year period (2008–2021). The fixed effects model was estimated using the E-Views software package. The panel data analysis results point to a noteworthy and favorable impact on ROA, explaining 92.75% of its variance. The results show that there is a strong positive relationship between ROA and four key factors: gross premium, retention ratio, expense ratio, and combined ratio. This underscores the importance of enhancing elements like gross premium, retention ratio, expense ratio, and combined ratio to elevate ROA. The conclusion of the study provides useful insights for improving the financial performance and competitiveness of nonlife insurance companies in Nepal. The study reveals the key success factors that affect the profitability and efficiency of the insurance sector. This suggests that nonlife insurance companies in Nepal can improve their profitability by focusing on increasing their gross premium, retention ratio, reducing expense ratio, and decreasing combined ratio. The findings have important implications for enhancing the performance and competitiveness of the nonlife insurance sector in Nepal.","PeriodicalId":32827,"journal":{"name":"Insurance Markets and Companies","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-12-05","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"138599944","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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