Authors : Lee Hui Shan, Kevin Low Lock Teng, Sia Bik Kai and Chong Shyue Chuan
Abstract: Insurance industry as part of the financial institutions is crucial as it plays essential roles to promote economic growth and development of the country by ensuring financial resources are allocated efficiently. Well-built financial essentials combined with industry strength are imperative for insurance-based companies to constantly perform healthy in their business. This study analyses the growth opportunity and its influencing factors of the insurance-based companies in the three regions of ASEAN namely Malaysia, Singapore and Indonesia covering a period from 2009-2013 to investigate the relationship between growth opportunity for the insurance industry with total investment income, net premium earned, claims and loss reserves, premium reserves, total assets and total liabilities as the specific factors of an insurance firm. Significant positive relationship are net premium earned and total assets to growth opportunities for the insurance industry, but there is negative relationship on total liabilities. This study suggests that, in collaboration with the integration under the Asean Economic Community (AEC), the preparation of Asean Insurance Council (AIC) to implement a 2 years master plan to drive the insurance industry’s growth ought to implement a policy to ensure transparency in total liabilities such as claims liabilities by the insurance companies to ensure the soundness growth of the insurance industry.
Lee Hui Shan, Kevin Low Lock Teng, Sia Bik Kai and Chong Shyue Chuan, 2016. Growth Opportunity of Insurance Industry and its Determinants in the Selected Countries of Asean. International Business Management, 10: 3892-3898.