Risk, technical efficiency and capital requirements of Ghanaian insurers

Daniel Attah-Kyei, Charles Andoh, Saint Kuttu

Research output: Contribution to journalArticlepeer-review

1 Citation (Scopus)

Abstract

This paper evaluates the effect of recapitalisation on technical efficiency and risk of life and non-life insurers in Ghana. The study uses balanced panel data for 14 life and 17 non-life insurers from 2008 to 2019. Technical efficiency is computed using Data Envelopment Analysis. A generalised least square estimation technique is used to determine the relationship between recapitalisation and technical efficiency and between recapitalisation and insurers’ risk. The empirical results show that recapitalisation has a significant positive effect on technical efficiency and a significant negative effect on the insurer’s risk. The findings also suggest that recapitalisation significantly mitigates risks and improves efficiency. The findings further provide insight into technical efficiency, regulation, and risk of insurance companies in Ghana.

Original languageEnglish
Article number22
JournalRisk Management
Volume25
Issue number4
DOIs
Publication statusPublished - Dec 2023
Externally publishedYes

Keywords

  • Insurer's risk
  • Recapitalisation
  • Regulation
  • Technical efficiency

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