Influence of Enterprise Risk Management integration on financial performance of non-life insurance companies in Kenya with the moderating effect of regulatory framework

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dc.contributor.authorNjiru, A. K.
dc.date.accessioned2025-08-19T11:30:47Z
dc.date.available2025-08-19T11:30:47Z
dc.date.issued2025
dc.descriptionFull - text thesis
dc.description.abstractEnterprise Risk Management (ERM) is a comprehensive approach, encompassing processes, structures, culture, and infrastructure, that organizations implement to identify and manage potential risks within their risk appetite. It is integrated into strategic planning and operational activities to provide reasonable assurance of achieving organizational objectives. While the theoretical benefits of ERM are well-established, its practical implementation, particularly within the dynamic and often volatile non-life insurance sector, presents significant challenges. This study addresses the empirical problem of understanding the specific influence of integrated ERM systems on the financial performance of non-life insurance companies in Kenya. It aimed to evaluate the distinct impacts of ERM process, culture, structure, and infrastructure integration on financial performance of non-life insurance companies in Kenya. To achieve this, the study was guided by guided by agency theory and contingency theory which provided a comprehensive theoretical framework. A descriptive research design was employed, targeting managers of five key departments (chief risk officers, chief finance manager, head of claims, head of underwriting, and head of sales/business development) across all 37 non-life insurance companies in Kenya who were selected using a purposive sampling method with a targeted population of 185 staff and a respondent sample size of 155 staff. Primary data was collected using structured questionnaires, while secondary data, including financial reports, was gathered using data collection sheets. Both descriptive and inferential statistical methods were adopted for data analysis. Findings suggest a state of underwhelming adoption of ERM components, especially ERM processes, structures, and infrastructure in Kenya’s non-life insurance sector. Inferential statistics reveal that integrating ERM culture and structure yields significant positive effects on both ROA and ROE whereas ERM process and infrastructure, while significantly predictive of ROA, does not extend to ROE. Additionally, the current regulatory framework does not significantly moderate the relationship between ERM practices and financial performance. Therefore, this study recommends that policymakers should enhance the regulatory environment to better complement the integration of ERM practices and that individual non-life insurance companies should prioritize investing in ERM culture and structure integration to optimize their financial performance, particularly in terms of improved ROA and ROE.
dc.identifier.citationNjiru, A. K. (2025). Influence of Enterprise Risk Management integration on financial performance of non-life insurance companies in Kenya with the moderating effect of regulatory framework [Strathmore University]. http://hdl.handle.net/11071/15767
dc.identifier.urihttp://hdl.handle.net/11071/15767
dc.language.isoen
dc.publisherStrathmore University
dc.titleInfluence of Enterprise Risk Management integration on financial performance of non-life insurance companies in Kenya with the moderating effect of regulatory framework
dc.typeThesis
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