Contextual Factors, Regulatory Support, and Performance of Insurance Industry Operators in Lagos State, Nigeria
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Date
2024-12
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Lead City University, Ibadan
Abstract
The significance of the insurance industry is vital for the survival of numerous organizations, as it provides economic and social welfare through risk mitigation, essential for individuals, businesses, and governments. Notwithstanding the insurance industry's substantial role in Nigeria, its performance over time indicates that the sector is considerably distant from realizing its full potential in significantly contributing to the nation's economic recovery. This development examines certain contextual factors within the industry and assesses whether it receives sufficient regulatory support to enhance its contribution to Nigeria's gross domestic product, akin to its counterparts in the financial sector. Hence, this study examines the effect of contextual factors on the performance of insurance industry operators in Lagos State, Nigeria. A cross-sectional survey research design was adopted. The population was 420 heads of strategic units within each of the seventy 70 insurance industry operators in Lagos State, Nigeria. Total enumeration method was adopted given the small population of the unit of analysis for the study. A validated questionnaire was used to collect data. The Cronbach’s
alpha reliability coefficients for the constructs ranged from 0.66 to 0.78. The response rate of 93% was achieved. Data were analyzed using descriptive and inferential statistics. Findings revealed that contextual factors had positive and significant effect on performance of insurance industry (R2= 0.336, F(1,389)= 19.558, p= 0.000). Contextual factors had positive and significant influence on client acquisition (Adj R2= 0.280, F(5,385)= 31.271, p= 0.000). Contextual factors had positive and significant effect on profitability (Adj R 2= 0.297, F(5,385)= 34.017, p= 0.000). Contextual factors had positive and significant effect on client satisfaction (Adj R2= 0.259, F(5,385)= 28.270, p= 0.000). Contextual factors had positive and significant influence loss development (Adj R 2= 0.192, F(5,385)= 19.558, p=0.000).Regulatory support had positive and significant moderating effect on the association between contextual factors and performance of insurance industry operators in Lagos State, Nigeria (ΔR2=0.285, ΔF= 51.870, P= 0.000). This study concluded that there was a statistically significant effect of contextual factors and regulatory support on performance of insurance industry operators Lagos State, Nigeria. The study recommended that management of the insurance industry operators in Lagos should renew their commitment to the dimension of
contextual factors including customer education, product innovation, technology integration, crisis management preparedness, and social responsibility initiatives and take advantage of regulatory support through social capital with insurance industry regulators such that policies formulation and enforcement can favour them.
Keywords: Contextual factors, Insurance industry, Management support, Performance
Word Count: 395
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Keywords
Contextual factors, Insurance industry, Management support, Performance
Citation
Kate Turabia