MBA Theses and Dissertations (2023)

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Browsing MBA Theses and Dissertations (2023) by Author "Kimwaki, Anne"

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    Non-financial factors affecting the performance of life insurance companies in Kenya
    (Strathmore University, 2023) Kimwaki, Anne
    Non-financial factors are important to assist managers in making decisions to match the internal business environment to the external business environment. However, there is insufficient empirical evidence on the effect of non-financial factors on the performance of insurance companies. The main contribution of this study was to show how various non-financial factors affect the performance of life insurance companies. The non-financial factors were grouped under regulatory, consumer, technology, and market factors and were selected as the study’s independent variables. Subjective measures of performance were selected as the dependent variable. Public interest theory, disruptive innovation theory, Porter’s five forces model, and the theory of planned behavior made for the study’s theoretical framework. The positivist research paradigm was adopted, while a descriptive research design was used. The target population consists of 24 life insurance firms as units of analysis, from which management staff were selected as units of observation. Census sampling was used to select all 120 respondents into the sample size. A structured questionnaire was used to collect data, and its reliability and validity were tested using Cronbach’s Alpha statistic. In analyzing data, descriptive and inferential analysis were employed, and findings were presented using tables and figures and interpreted. Out of 120 questionnaires, 90 were returned, implying a response rate of 75% was achieved. The analysis showed regulatory factors, consumer factors, and technological factors positively and significantly influenced the performance of LICs; however, market factors had a negative and significant influence on the performance of LICs. The study concluded that regulatory factors, consumer factors, and technological factors have a positive effect on the performance of life insurance companies, while market factors have a negative effect on their performance. Therefore, the study suggests that life insurance companies should pay attention to these factors and consider reflecting them in their annual reports. They should also have necessary measures to either take advantage of or counter these factors to optimize their performance. They should continue adopting robust systems to measure risks they take on to meet increased capital requirements, thereby reducing the risk of losing their operating licenses. LICs should adopt greater diversity in product ranges to enhance their quality of service and overall performance; adopt emerging technology to enhance their service quality and customer satisfaction by broadening their reach through increased use of digital sales and service channels. Lastly, LICs should also enter into mergers and acquisitions (M&A) activities with other smaller players in the insurance industry to increase their market share and performance.