DETERMINANTS OF PERFORMANCE OF INSURANCE COMPANIES IN NIGERIA

Profitability as we have come to understand has proven to be a very important factor of judging the determinant of performance of insurance industry in Nigeria. In the past decade, the number of players in the insurance sector have escalated meaningfully with currently (32) insurance companies offering services nationwide. This has modified the dynamics of business in this sector as the companies are faced with harder task in attaining competitive advantage. However, the available literature is not sufficient to determine what exactly affects how the insurance companies in the country perform. This study sought to establish profitability as the determinant of performance of insurance companies in Nigeria. The descriptive statistics, correlation coefficient, Hausman test and panel regression were used in the analysis of the data. The result from the empirical investigation shows that fixed asset, firm size and current ratio needs an urgent attention. Hence, relevant regulatory authority such as National Insurance Commission (NAICOM) should develop appropriate measure that will enhance the effectiveness of the industry by encouraging firms to embark on more study on their internal factors.