AN ASSESSMENT OF THE PERFORMANCE OF NON-LIFE INSURANCE IN CASE OF NYALA INSURANCE S.C

Abstract

The study was carried out to assess the performance of Non-life insurance at Nyala Insurance S. C by applying financial and Non-financial soundness indicators. The financial soundness was assessed by using CARAMEL frame work which includes Capital Adequacy, Asset Quality, Reinsurance and Actuarial issues, Management Soundness, Earnings and Profitability and Liquidity. And for the Non-financial soundness Market share, Growth in the number of branches, Market Research, Customer Satisfaction and employee’s performance as well as satisfaction was applied. Also the study tried to assess the companies ten years data i.e. from 2009-2018. The sample size was 395 customers and 194 employees and five selected branches and also interview was made to 13 marketing department members. The study findings show that Nyala Insurance S.C utilized depends on its capital to secure new business, has good performance in receivable management and risk related with equity investment is good, risks retained was found to be lower than the statutory limit additionally the companies risk bearing ability is moderate. The company also shows good amount of technical reserves which indicated that it have good survival ratio, loss ratio of the company is low compared to the standard and liquidity risk of the company is high. When we see the market share of the company it is almost the same with the industry but companies existing business are declining which will affect its profitability. Branch expansion of the company is good and the level of customer and employee satisfaction is above average which is also good. Finally the study recommended that NISCO should manage its liquidity, also must manage its asset and liabilities and reduce impact of underwriting risk and review its re-insurance arrangement.