Improving the Financial Performance of Life Insurance Industry in Nigeria Through Effective Asset–Liability Management

Kudirat Adeola  Banjo; John Akinbiyi  OYETADE

BANJO, Kudirat Adeola Department of Insurance and Actuarial Science, Faculty of Applied Social Sciences, Lagos State University of Science and Technology, Lagos, Nigeria
OYETADE, John Akinbiyi Department of Accounting, Faculty of Applied Social Sciences, Lagos State University of Science and Technology, Lagos, Nigeria

Keywords: Financial Performance, Life Insurance, Industry, Asset and Liability Management

Abstract

The financial performance of the life insurance sector has either remained stagnant or has declined over time as a result of poor management of their liabilities and assets. The purpose of this research is to improve the financial performance of the Nigerian life insurance industry via efficient asset–liability management. To attain the objectives of study, this study concentrated on ten life insurance companies that have been in operation from 2009 to 2020. The panel data regression model was used to test the study's hypotheses. According to the findings of this study, the poor financial performance of the life insurance industry can be attributed to poor asset and liability management. This study recommended that management of Insurance Firms hire professional accountants for appropriate asset and liability management; premium received (assets) by Life Insurance companies be invested into more productive investments which can assure maximum profit; assets that are less performing or outdated should be turned into cash and invested adequately and liabilities (particularly claims payable) should be prioritized in terms of management.