Determinants of Investment Behaviour of Insurance Companies in Nigeria
Abstract: This study empirically investigated the determinants of investment behavior of insurance companies in Nigeria using the cointegration and Phillips-Hansen estimation procedure applied to annual time series Nigerian data from 1980 through 2013. The correlates include premium generation ability, capital base, state of the economy, financial market conditions, profit from current operations and investments in the previous periods. The results indicate that the variables significantly and positively influence insurance investment behavior. Only current profitability was found to exert positive but insignificant influence on investment behavior. Previous investments positively and significantly affect the current investment behavior of insurance companies in Nigeria. The results subscribe to the existence of partial adjustment effects. The results also imply that the observed short-run influences will likely persist in the long-run, ceteris paribus.
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Authors: Chinedu B. Ezirim, Patience Amaewhule, Azuka E. Amuzie, Nneka Charles-Anyaogu
