IMPACT OF RISK ON THE FINANCIAL PERFORMANCE OF LISTED INSURANCE FIRMS IN NIGERIA

Abstract

This study examined risk and financial performance of listed insurance firms in Nigeria for the period of ten years from 2011-2020. The population of the study consists of 22 insurance firms listed on the floor of Nigerian Stock Exchange as at 31st December 2020. Secondary data was extracted from the audited financial reports of the sampled insurance firms. The data was analyzed using the regression model. The study findings revealed that underwriting risk is negatively and significantly influencing the financial performance of listed insurance firms in Nigeria. Conversely, liquidity risk revealed a statistical negative and insignificant impact on financial performance. The study concluded that underwriting risk has a strong relationship with the financial performance of the listed insurance firms for the period. Following this, the study recommends that insurance firms should continually develop and implement risk management policies and strategies that will help reduce their risk profile in order to improve their financial performance.