Asset Size and Profitability of Life Insurance Companies in Nigeria: A Panel Data Approach
The magnitude of a company is a key element in evaluating organizational ascendancy while economies of scale is an advantage for most large corporations. This study examined how the size of life insurance companies asset base affect profitability in Nigeria between 2011 and 2021. Data on asset of life insurance companies, and insurance digest of the Nigerian Insurers Association (NIA) were used to determine profit after tax and asset size for the relevant period. The data’s stationarity test revealed that the data are stationary at the significance levels of 1%, 5%, and 10%. Data are statistically significant because the calculated probability (F-statistic) value from the ordinary least squares regression is smaller than the 0.05 significant value. The profit after tax is accounted for by 73.8811percent of the total assets of life insurance firms, according to the computed linear co-efficient o f determination (R2= 0.738811). The study’s findings reports that asset size has effect on the financial success of insurance businesses in Nigeria.
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