Reinsurance and Financial Performance of Non-life Insurance Companies in Ghana

Charles Andoh and Susana Adobea Yamoah

Management and Labour Studies, 2021, vol. 46, issue 2, 161-174

Abstract: The study examines how premiums ceded to a reinsurer affect the profitability of non-life insurance companies in Ghana. Secondary data on reinsurance ceded, combined ratio, assets, liabilities and return on assets for 20 non-life insurance companies over the period 2008–2018 were sourced from National Insurance Commission whilst interest and exchange rates variables were obtained from the Bank of Ghana. Panel regression model was employed for the analysis of the data collected. The results show that purchasing high levels of reinsurance alone does not affect the profitability of non-life insurance companies, but the combined effect of reinsurance and solvency ratio significantly impact their profitability. Managers of non-life insurance companies in Ghana should increase their ability to repay all financial obligations in the short, medium and long term in combination with reinsurance. This will enable insurers to stabilize growth, earn profits and meet their obligations to policyholders in a timely fashion. JEL Code: G22

Keywords: Combined ratio; panel regression; profitability; reinsurance; solvency ratio (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://journals.sagepub.com/doi/10.1177/0258042X21989942 (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:sae:manlab:v:46:y:2021:i:2:p:161-174

DOI: 10.1177/0258042X21989942

Access Statistics for this article

More articles in Management and Labour Studies from XLRI Jamshedpur, School of Business Management & Human Resources
Bibliographic data for series maintained by SAGE Publications ().