Assessing the firm specific (internal) factors affecting the profitability of insurance firms in Zimbabwe during the period 2019-2022: A case of Safel Insurance Company
- Author
- Meki, Takudzwa
- Title
- Assessing the firm specific (internal) factors affecting the profitability of insurance firms in Zimbabwe during the period 2019-2022: A case of Safel Insurance Company
- Abstract
-
The study sought to examine the internal factors affecting the profitability of insurance
companies in Zimbabwe. Research adopted return on asset as a measure of the firm`s
profitability. Primary data was used to select the variables to be used in the study with the
employees of the firm putting forward the factors that they thought had an impact on the firm’s
profitability. The selected factors include firm age, liquidity, leverage, firm size and volume of
capital with return on assets (ROA) as a proxy for profitability
Observations from the primary data collected were then combined with secondary from
published financial statements. The researcher used correlation and multiple linear regression
models to determine the internal factors affecting insurance firm`s profitability and identifying
the overall impact of these factors on the firm`s profitability. The examined relationship
between profitability and a set of selected variables, profitability was established as the
dependent variable with the independent variables being firm age, firm size, volume of capital,
leverage liquidity ratio.
The results of the study concluded that there exist a positive and statistically significant
between profitability and liquidity, firm size, and volume of capital. Thus a positive movement
in liquidity, size of firm and volume of capital will result in a positive movement in the firm’s
profits. A positive relationship between firm age and profitability was established though it
was deemed to be statistically immaterial. The study also established a negative relationship
between a firm`s leverage ratio and profitability thus it was concluded that the higher the firm`s
leverage, the lower the profits that the firm will gain.
- Date
- 2022
- Publisher
- BUSE
- Keywords
- Profitability
- Insurance
- Supervisor
- N/A
- Item sets
- Department of Accountancy
