Ownership Structure and the Performance of Nigerian Insurance Companies

Posted: 14 Dec 2006

Date Written: 2006

Abstract

There is the argument of whether ownership plays any significant role in determining the performance of firms in Nigeria. We therefore, analyze the effects of ownership type and concentration on the performance of a population of insurance companies in Nigeria. Using Data Envelopment Analysis and Multivariate Regression Analysis, we find that there is significant performance improvement by most of the insurance companies and the foreign-owned firms that have little or no domestic ownership, improves some measures of performance relative to state ownership. However, private ownership, rather than foreign ownership, tends to have greater impact on insurance companies performance variables, because the coefficient of most performance measures is higher for private ownership relative to foreign ownership. This leads to the conclusion that there is significant relationship between ownership type and the performance of insurance companies in Nigeria. Furthermore, regardless of insurance companies' size and industrial business, and with respect to their effects on the insurance companies' performance, the ownership structure still maintains the same sign and significance. It is the recommendation of the paper that although ownership plays an important role in the performance of these firms, there is the need for continued supervision and monitoring by the relevant regulatory agents, to ensure continues and ensured performance of the firms.

Keywords: Ownership Structure, Nigerian Insurance companies

Suggested Citation

Tanko, Professor Muhammad, Ownership Structure and the Performance of Nigerian Insurance Companies (2006). Available at SSRN: https://ssrn.com/abstract=951407

Professor Muhammad Tanko (Contact Author)

Kaduna State University ( email )

Tafawa Balewa Way
P. M. B. 2339
Kaduna State
Nigeria

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