Antecedents of Financial Performance of Insurance Companies in Pakistan

Abstract

The insurance sector plays a crucial role in the economic growth of a country by offering protection against financial losses and facilitating as an institutional investor in capital and money markets. The purpose of this study is to identify the factors that affect the financial performance of insurance industry in Pakistan. We took the data of 10 insurance companies having minimum IFS rating of A+ as per the rating of Pakistan Credit Rating Agency Limited for five years 2018-2022 . The results of this study revealed significant negative associations between ROA and firm size, as well as loss ratio. However, investment income, premium growth, and capital ratios show insignificant relationships with ROA, emphasizing the multifaceted nature of profitability determinants within the insurance sector.