Key Financial Ratios and Listed Insurance Companies' Performance in Nigeria

  • Najimu Ayinde Nafiu Federal Polytechnic Ilaro, Ogun State
  • Philemon Danan Ayuba University of Lagos, Akoka, Lagos State
Keywords: Financial Ratios, Insurance Companies, Risk Management, Insurance, Performance JEL Classification Codes: G17, G22, G32, G52, L25


The global business for economic operations is prudently agreed by the insurance industry, in which key fiscal proportions are to regularize quoted insurance companies' operations so that total direct income earnings and reinsurers’ values would be reasonably negotiated. The research is objectively analyzed independent variables with dependent variable in Nigerian insurance industry. Subsidiary tools generated are employed through financial and accounting reports from five randomly chosen financial institutions for ten (2011-2020) years. Correlation and multivariate ordinary statistics are utilized to analyze the generated tools. The findings reveal the autonomous variables to have shown unimportantly direct and not strong membership to subordinate variation (ROA). In relation to the outcomes, the following recommendations for this study are given below. The key financial ratios parameters on production should effectively and efficiently underwrite insured risk prudently increase the retention values and capacity as well as decrease reinsurance cost transferred. Since insurance is a risk management tool to drive the economy, the utmost decision policies should be exercised to make sound competitiveness among other financial institutions for futuristic reputation to be ascertained. Quoted and general insurance operators should prudently energize their reserves and hedge their funds against catastrophic risks in order to reduce capital flight of insurance funds to counterpart reinsurance companies. The primary insurers’ reactiveness should be improved in order to reduce losses and damage to the Nigerian economy. Lastly, comparative analysis between insurance and other financial institutions ratios: thier performance in financial industry.

Author Biographies

Najimu Ayinde Nafiu, Federal Polytechnic Ilaro, Ogun State

Department of Insurance, School of Management Sciences,

Philemon Danan Ayuba, University of Lagos, Akoka, Lagos State

Department of Actuarial Science and Insurance, Faculty of Management Sciences,