Determinant of Profitability of Listed Insurance Companies in Nigeria

Ishaq Alhaji Samail
PhD, ACA
Department of Accounting, Bayero University, Kano, P.M.B. 3045, Kano-Nigeria
ishaqabuhaidara@gmail.com, +2348039643788
&
Jamilu Muhammad Ibrahim
Department of Accounting, Bayero University, Kano, P.M.B. 3045, Kano-Nigeria
Zamani4tos@gmail.com, +2348030661004

This study examined the determinants of financial performance with emphases on profitability of
the listed insurance companies in Nigeria. 19 out of the 26 insurance firms listed on the Nigerian
Stock Exchange were used as the sample of the study. Data of the study covering a period of ten
years (2009 to 2018) were collected from the Annual report and account of the selected Insurance
Companies and were analysed using Descriptive Statistics, Correlation and regression analysis.
The study uncovered that liquidity, investment, reinsurance dependence and retention ratio are
the major determinants of financial performance of listed insurance companies in Nigeria. The
study recommended that listed insurance companies should convert significant part of their cash
and cash equivalent into productive assets that can improve their financial performance, increase
investment in profitable sectors, give adequate attention to reinsurance facilities, view reinsurance
as an important risk management mechanism and retain a good portion of their net income to
grow the company.
Keywords: Determinants, Profitability, Nigerian Insurance Companies.

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