Determinants of Insurance Company Profitability in Ethiopia (Case Study on Nile Insurance, Dire Dawa Branch)

Abstract

Every business organization faces a problem which hinders its objective for which it is established. So, like any business organization Nile Insurance Company faces many problems which affects its profitability and the main purpose of this study is to assess factors affecting profitability of Nile Insurance Dire Dawa branch. To do so, a discriptive research design  together with  primery and secoundray data were applied  and  data were collected form  319 active customers inaddtion to the  interview made with branch manager. The  result shows size, leverage, tangibility of asset, loss ratio/ risk, firm growth and managerial efficiency are identified as significant determinants of profitability hence Liquidity and age of the company have medium significant determinants of profitability  in addition to brand preference and perceived quality which have high impact on insurance selection process by coustomers.

Keywords: Insurance ,perceived quality ,brand preference, leverage, tangebilty of asset.