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" Firms Pecific Factors and Other Determinants of Performance of Listed Insurance Companies in Nigeria "
Bukola, Adejare Rukayat
Adeyemmi, Kenneth
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Latin Dissertation
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| Language of Document
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English
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| Record Number
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1057351
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| Doc. No
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TL56468
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| Main Entry
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Bukola, Adejare Rukayat
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| Title & Author
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Firms Pecific Factors and Other Determinants of Performance of Listed Insurance Companies in Nigeria\ Bukola, Adejare RukayatAdeyemmi, Kenneth
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| College
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Kwara State University (Nigeria)
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| Date
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2020
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| Degree
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Ph.D.
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2020
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| Note
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220 p.
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| Abstract
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The insurance sub-sector in any economy is expected to play a pivotal role in the financial system with respect to reduction of business risks, facilitation of economics of scale, and diversification of financial risk. However, the overall performance of Nigerian insurance sub-sector is weak evidence with inappropriate response to economic challenges and less than 1% contribution to the GDP of Nigerian economy. This study examines the impact of firm specific factors and other determinants of performance of listed insurance companies in Nigeria. The main objective was achieved by examining the impact of demographic factors, socio-cultural factors, firm specific factors, board member characteristics and selected macroeconomic variables on performance of listed Insurance companies in Nigeria. The performance was achieved with demand for insurance products by customers and CARAMELS financial indicators(Capital adequacy, Asset quality, Reinsurance and Actuarial, Management efficiency, Earnings/Profitability, Liquidity and Sensitivity to market risk) of the listed insurance companies. The population of the study includes all listed insurance companies in Nigeria and their customers Data were sourced from a structured questionnaire, annual reports of Insurance companies and Central Bank of Nigeria statistical-bulletin between 2012 and 2018. Primary data were analysed using descriptive and Ordinal logistic regression, while secondary data were analyzed using serially correlated disturbance random effects. The results of this study revealed that on demographic factors age (α = 0.461, P < 0.013), single marital status (α = 2.031, P < 0.030), married marital status (α = 1.936, P < 0.030), divorced marital status (α = 2.196, P < 0.020), and type of work of customers (α = −0.260, P < 0.034) had a statistically significant influence on demand for insurance policy by customers. Among the socio-cultural factors, Islamic Religious belief (β = 0.478, P < 0.006), Christianity Religious belief (β = 0.685, P < 0.000), language (β = 0.296, P < 0.012), trust (β = 1.552, P < 0.000)and level of awareness of customers (β = −1.209, P < 0.000) significantly affect demand for insurance product. On firm specific characteristics, the findings depict that age(α = 0.00187, P < 0.015) and leverage (α = 1.773, p < 0.038) significantly influence asset quality, while size significantly affect capital adequacy(α = −0.29, P < 0.000), management efficiency (α = −0.084, P < 0.021) and solvency (α = −0.29, P < 0.000) of listed insurance companies. On board characteristics, management efficiency has significant relationship with board size (α = −0.0154, p < 0.046) and board gender diversity (α = 0.224, p < 0.078) while board independence significantly affects asset quality (α = 0.0787, p < 0.086), management efficiency (α = 0.518, p < 0.002), earnings and profitability (α = 0.569, p < 0.090) of listed insurance companies. The result further revealed that exchange rate significantly influences capital adequacy and solvency (α = 0.00195, p < 0.016), growth rate (α = 0.0153, p < 0.070)and inflation rate (α = 0.0165, p < 0.037)significantly related to reinsurance and actuarial of listed insurance companies. The study concludes that the level of education, age, trust, level of awareness of customers affect the demand for insurance products. Besides, it shows that age, size, leverage, and board characteristics of insurance companies influence their performance. Inflation, exchange and growth rates also influence the performance of listed insurance companies in Nigeria. The study recommends that management of insurance companies should strengthen their sensitization among customers regardless of age, marital status and working class. An experience sharing among the listed insurance companies should be practiced and at least an independent member should be on the board.
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| Descriptor
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African studies
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Finance
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Adeyemmi, Kenneth
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Kwara State University (Nigeria)
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