ANALYSIS OF SELECTED FACTORS INFLUENCING FINANCIAL PERFORMANCE OF INSURANCE COMPANIES LISTED AT THE NSE, KENYA

Titus Tilu Maseki, James N. Kung’u, John W. Nderitu

Abstract


Insurance businesses are designed to pool and accumulate large sums of money in order to settle claims arising from their clients in the event of loss. The companies venture into stock trading, underwriting ventures and property investments in addition to their core activities of generating income from net premiums. Several factors influence the operation results of these firms. The study used descriptive research design where a sample of thirty six (36) respondents was chosen through stratified sampling. Questionnaires were administered through drop and pick method. Both descriptive and inferential statistics were analysed. Inferential analysis failed to accept the null hypotheses that there was no statistically significant influence of selected factors; risk perception, macroeconomics and investment portfolio choice on financial performance of insurance companies. The results of the study indicated that considered in isolation risk perception explained 19.6% of the variability in financial performance while macroeconomic and investment portfolio choice factors accounted for 18.2% and 15.9% respectively of the changes in financial performance. The joint independent variables were associated to 74.9% of the variability in financial performance of insurance firms. However, there are other factors that explain the variance of financial performance of insurance companies in Kenya that were not included in the model.

 

JEL: G10; G22; G23

 

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risk perception, macroeconomics, investment portfolio choice, financial performance

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References


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DOI: http://dx.doi.org/10.46827/ejefr.v0i0.647

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