Financial Performance Of General Insurance Companies In Bangladesh: A .

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International Journal of Research and Innovation in Social Science (IJRISS) Volume V, Issue VII, July 2021 ISSN 2454-6186Financial Performance of General InsuranceCompanies in Bangladesh: A 2003-2020 EvaluationDr. Muhammad Ziaulhaq Mamun1, and Fairuz Chowdhury21Pro-Vice Chancellor, East West University, Bangladesh Former Professor, Institute of Business Administration University ofDhaka2Assistant Professor Institute of Business Administration University of Dhaka Dhaka, BangladeshAbstract: This paper analyzed the financial performance of thegeneral insurance companies of Bangladesh over the period2003-2020 by studying 18 general insurance companies out of 46(including the only government owned company Sadharan BimaCorporation, SBC). In terms of net premium, the study found nodefinite industry trends; but, the only nationalized insurancecompany (SBC) has around 1200% higher premium earningsthan the private average. Also, SBC has the highest figures forboth investment and investment income for the studied period.Average investment has increased in the private insurance sectorsteadily during 2003-2007, then onward there was sharp ups anddowns; but SBC’s investment growth has been steady allthrough. In the studied period, the net claims of most privateinsurance companies have increased significantly with an overallrising trend. SBC has been incurring the most net claims and itsaverage is 2543.18% more than private insurance companies’average.Regarding APBT (annual profit before tax), SBC had a muchhigher figure than any of the private companies and is almost1200% of the average of the private general insurancecompanies. ROTA for most of the companies is consistentthroughout the studied years. The companies had their highestROTA during 2008-2010. The average of the private insurancesshowed much more fluctuation than SBC. The study found verystrong correlation between industry net premium and net claims.But majority of the sample companies depict a negativecorrelation between profit and share price. The study furthernoted that older companies were financially better off comparedto the newly established companies. Also, among the privategeneral insurance companies there is variability in performance.SBC, being the only public insurance company, has a lot upperhand. Overall it can be said that the general insurance sector isdoing moderately well.vulnerability to natural disasters like flood, cyclone, draught,and tornado. There are also other factors like politicalvolatility, and economic concerns like inflation, high interestrate, tax policy, deregulation, etc., (Khan and Uddin, 2020).However, Bangladesh’s, insurance market is not very largecompared to the degree of risk. Currently, 78 insurancecompanies, 32 life and 46 general, are operating in thecountry.The insurance penetration (ratio of premium underwritten in aparticular year to GDP) in Bangladesh, especially non-lifeinsurance, remained static in last decade although 14 newcompanies entered the market during the period, bringing thetotal to 78. The overall insurance penetration in Bangladeshstood at a meagre 0.57% in 2018 - the lowest among emergingAsian countries (Swiss Re 2018). In 2018, the insurancepenetration was 5.27% in Thailand, followed by 4.77% inMalaysia, 4.22% in China, 3.70% in India, 2.42% in Vietnam,1.95% in Indonesia, 1.82% in the Philippines and 1.15% in SriLanka. Taiwan has the highest penetration rate with 18%(Figure 1). The trend in insurance penetration rate as apercentage of GDP over a period of 10 years (2009-2018) inlife, non-life and overall insurance sector shows the gloomypicture of non-life sector in Bangladesh (Figure 2).Key words: APBT, investment, investment income, net claim, netincome, ROTAI. INTRODUCTIONFigure 1: Insurance Penetration in Emerging Asia-Pacific Countriesnsurance is an important sector that fosters financialstability by enabling economic agents to undertake varioustransactions with the transfer and dispersion of risks.Insurance provides the insured with a means of offsetting theburden of financial losses. Insurers protect individuals andbusinesses from the adverse effects of losses by peril, hazard,death, accident and many other unwanted happenings.Bangladesh economy holds huge risk in every sector due to itsFigure 2: Insurance Penetration in Bangladesh as Percentage of GDP1.1 BackgroundIwww.rsisinternational.orgPage 715

International Journal of Research and Innovation in Social Science (IJRISS) Volume V, Issue VII, July 2021 ISSN 2454-6186Interestingly, the high economic development of Bangladeshseems to have no relation with the insurance sector. Insuranceis struggling with low penetration rate at a time of higheconomic growth (7 %). Bangladesh is the most underinsuredcountry in the non-life insurance category, despite to lose asmuch as 0.8 % of its GDP to natural disasters a year. Theinsurance gap of the country, which indicates assets at riskthat are not covered by insurance, stands at 5.5 billion, or2.1% of the GDP. The low insurance penetration rate can beattributed to the absence of any compulsory insurance, poorawareness and trust gap. Countries that have done well ininsurance have multiple compulsory insurance systems,supported by the government subsidies on insurance.In Bangladesh, insurance is not yet a top-priority financialmanagement tool as there is lack of awareness andunderstanding about insurance among people. This is for lackof insurance literacy and confidence, shortage of diversifiedproducts, while mistrust is another big reason for lowpenetration. Besides, there is no mandatory insurance in someareas such as health and agriculture in Bangladesh, whereas inIndia, the contribution of health insurance is about 7 billion.However, the regulator of the insurance sector mentions lacksof diversified products as another reason for the lowpenetration. Meanwhile, government of Bangladesh is tryingto make crop insurance, railway passengers' insurance,building insurance, cattle insurance, education insurance, andhealth insurance mandatory. With these policy support fromthe government, insurance penetration will increaseconsiderably.Policy holders, however, blame delay in fixing claims andambiguity in terms and conditions during opening a policy.Terms and conditions are not well explained during opening apolicy, which creates mistrust (Mamun 2016). Moreover,hassles, procrastination and cumbersome process of fixing theclaims are major reasons for low penetration. For a betterfunctioning of the insurance industry and to attain goodgrowth of this sector, it is worthwhile to know the factorswhich are responsible for low growth of the insuranceindustry in Bangladesh. Some of the factors include politicalinstability, weak government model, shallow product base,low risk-taking ability due to low capital base, low premiumdue to low penetration rate and poor skills of employees.In non-life insurance, the insured is compensated duly theamount of loss sustained by him subject to the ceiling fixed bythe sum assured. It includes property insurance, liabilityinsurance and other form of insurance. Fire and marineinsurance are strictly called property insurance. Motor, theft,fidelity and machine insurances include the extent of liabilityinsurance to a certain extent. In Bangladesh the marineinsurance is the backbone for the non-life insurance business.Marine insurance completely depends on imports which weregreatly disturbed by the political unrest time and again.Improving the performance of non-life insurance sector willnot only help the insurance companies but will help otherbusinesses, policy holders, and the country. An efficientwww.rsisinternational.orginsurance sector can contribute to the growth of the economyby facilitating new investments and their sustainability.Keeping these in mind this research investigated the financialperformance of the non-life general insurance sector amid theproblems, if at all.1.2 ObjectivesThe broad objective of the study is to evaluate the financialperformance of general insurance companies in Bangladeshover the period 2003-2018. Specifically, the study i) analyzesthe trends in the performance of general insurance companiesof Bangladesh, ii) evaluates the performance of generalinsurance companies of Bangladesh on some financialparameters (e.g., net premium, investment & investmentincome, net claims, profits & profitability), iii) compares thefinancial performance of private general insurance companieswith the only state owned general insurance company in thecountry - ‘Sadharan Bima Corporation (SBC)’.II. METHODOLOGYThe study is mainly based on secondary data. The main sourceof secondary data is the reports (2003-2018) published byBangladesh Insurance Association (BIA). In addition, variousbooks, journals, articles and thesis papers related to prevailingproblems and current situation of the insurance industry ofBangladesh is also studied. There are 45 private and onepublic general insurance company (Shadharon BimaCorporation - SBC) operating in the country. Of the privategeneral insurance companies, 17 private general insurancecompanies and the only public general insurance company(SBC) were taken for the study. SBC was established in 1973.To get a better representation the insurance companies wereselected based on their year of establishment. Among theprivate general insurance companies 7 companies wereestablished in 1980s, 5 companies were established in 1990s,and 5 companies were established in 2000s. The selection ofprivate insurance companies was based on convenience andjudgmental basis.III. ANALYSIS & FINDINGSThe analysis of the collected data has been done according tothe specific objectives and parameters of this study. In thefollowing subsections the data analysis is provided alignedwith the six specific financial parameters to evaluate theperformance of general insurance sector of Bangladesh.3.1 Trend of Net PremiumPremium is an amount paid periodically to the insurer by theinsured for covering the risk. Net premium is the expectedpresent value of a policy's benefits less the expected presentvalue of future premiums. The net premium calculation doesnot consider future expenses associated with maintaining thepolicy. The main revenue source of general insurancecompanies is the net premium. For the period 2003-2018, thenet premiums of most private insurance companies haveincreased significantly with varied fluctuations (averagePage 716

International Journal of Research and Innovation in Social Science (IJRISS) Volume V, Issue VII, July 2021 ISSN 2454-6186deviation 46%); but the overall trend was a rise in netpremium with positive CAGR (cumulative annual growthrate) of 12%. The same trend can be seen with SBC with quitehigh fluctuations (deviation 41%, CAGR 11%).The increase in premium indicates that more companies areconsidering insurance policies indicating a growing non-lifeinsurance industry of Bangladesh. Increased awareness of thebenefits of insurance and increased competition in the sectorthat have made companies to promote more may be thereasons that have fueled the growth. Again, a high netpremium doesn’t necessarily indicate high performancebecause there are other costs such as claims, associated withthe net premium to consider before obtaining the bottom-linefigure of profit. A high net premium does, however, indicate ahigher amount of revenue earnings from the insurance policiesprovided.Average annual growth in net premium of insurancecompanies was erratic with a lot of fluctuations (Figure 3).However, it was always mostly positive. The highest growthof private insurance companies occurred in 2007 and thelowest was in 2015. Fluctuation for SBC was greater withhighest growth of in 2004 and 2012. It also saw 0% and evennegative growth in this time period.Figure 4: Average Net Premium of the Companies Categorized into DecadesRegarding growth (CAGR) the older companies are quitesteady with less deviation, but the 1990s and 2000s companiesnet premium growth fluctuates a lot (Figure 5). One possiblereason is that the older companies had more time to settledown and make a name and brand image for them.Furthermore, these companies started in an era of lesscompetition. The combined effects of sustainable reputationand less competition contributed to the benefits of the 1980scompanies. But the newly formed companies started hurriedlywithout much market survey and need analysis.Average growth of net premium60%40%20%0%-20%200020052010Growth Private(%)20152020Growth SBC(%)Figure 3: The Average Annual Growth of Net Premium (Private InsuranceCompanies and SBC)As noted, the net premium growth among the privatecompanies has shown a lot of deviation. Some are doing good;some are performing poorly. To analyze this, the companieswere divided in 3 categories based on the decade they startedtheir operation: i) Companies established in 1980s, ii)Companies established in 1990s, and iii) Companiesestablished in 2000s. Based on these three divisions the studytracked their performance in the studied period. It is foundthat the older companies established in 1980s havesignificantly higher average net premium (Figure 4). Thisgroup is followed by the 1990s group and 2000s grouprespectively. The newly established companies net premiumincome is not very impressive lately.Figure 5: Growth Rate of Net Premium of the Companies Categorized intoDecadesAs noted, SBC’s net premium is much higher compared toany of the private insurance company. It can be mentionedhere that as per Insurance Corporation (Amendment) Act1990 50% of all insurance business relating to any publicproperty or to any risk or liability appertaining to any publicproperty shall be placed with the SBC and the remaining 50%of such business may be placed with this Corporation or withany other insurers in Bangladesh. But for practical reason andin agreement with the Insurance Association of Bangladesh,SBC underwrites all the public sector business and 50% ofthat business is distributed among the existing 45 privategeneral insurance companies equally under national coinsurance scheme.In respect of reinsurance, the same act provides that 50% of acompany’s reinsurance business must be placed with the SBCwww.rsisinternational.orgPage 717

International Journal of Research and Innovation in Social Science (IJRISS) Volume V, Issue VII, July 2021 ISSN 2454-6186and remaining fifty percent may be reinsured either with thisCorporation or with any insurer in Bangladesh or abroad. Themain pillar of the SBC is insurance, as well as, reinsurancebusiness. SBC is the largest non-life insurance underwriter inBangladesh in terms of gross premium, network of offices &trained manpower. On the other hand, SBC reinsures the risksof private insurance companies operating in Bangladesh. Thisis the main reason why SBC has such high insurancepremium.The study further undertook the time series analysis of netpremium of the insurance companies. The regression analysisis showing the trend of the net premium with time of thestudied companies (Table 1). The F-statistics confirmed thevalidity of the models (Sig F 0.05). For private insurancecompanies studied, the R2 value of 12 companies are found tobe above 90%, 3 are above 80%, and only 2 company arebelow 80% showing the high explanatory power of time inmeasuring the net premium. The R2 of the private industryaverage is also very high (99%) explaining high variability ofthe net premium of the private insurance industry. For SBCthe R2 is 96% showing the strong explanatory power of themodel.Table 1: Regression Models of Net Premium of the Insurance CompaniesSerial NoCompanyNameRegression ModelRSquaredFSignificance1AgraniY 0.11195X 0.6001295%2.06E-102BGICY 0.24909X 0.7727776%1.02E-05Bangladesh NationalContinentalGreenDeltaY 0.27794X - 0.4908880%3.21E-06Y 0.23985X 0.2250689%3.23E-08Y 1.19636X 0.1034497%8.03E-126NitolY 0.45513X - 0.8635988%7.06E-087MercantileY 0.12107X 0.4357892%6.07E-098PeoplesY 0.24398X 0.8919594%8.17E-109PhoenixY 0.24899X 1.488790%2.57E-0810PioneerY 1.18136X - 2.4458896%6.32E-1111PragatiY 0.42845X 2.0318996%2.59E-1134512PrimeY 0.15009X 0.7657661%0.00038375613RelianceY 0.86996X 0.0190995%1.05E-1014RepublicY 0.30604X - 0.3066193%1.58E-0915SonarBanglaY 0.22971X - 0.0602694%7.68E-1016TakafulY 0.15948X 0.2427994%7.71E-1017UnitedY 0.17523X 0.2353293%1.75E-0918Average(Private)Y 0.39087X 0.2144499%3.20E-1419SBCY 4.19927X 9.1803096%3.78E-1120IndustryAverageY 0.60244X 0.7125499%2.87E-14www.rsisinternational.org3.2 Trend of Investment & Investment Income3.2.1 Trend of InvestmentInsurance companies try to increase their wealth not onlythrough gaining premium, but also investing that premiumincome into different profitable ventures. The growth ofinsurance companies depends on efficient mix of portfoliothat consists of profitable investments. Data of investment ofthe general insurance companies showed that the averageinvestment has increased in the private insurance sectorsteadily from 2003 to 2007; then after, there was foursignificant jumps in 2008 ( 1.16 million to 2.05 million),2010 ( 2.4million to 3.7 million), 2011 ( 3.7 million to 5.3million) and 2017 ( 6.5 million to 9.0 million) and a bigdrop in 2012 ( 5.3 million to 4.2 million).The average investment of the private insurers found to be 3.9 million with 60% deviation. SBC’s investment wascomparatively higher ( 28.5 million) with 50% deviation.But, overall, the private industry growth rate was much higher(18%) than the SBC (11%). SBC is the sponsor shareholder ofICB (Investment Corporation of Bangladesh), IDLC(Industrial Development and Leasing Company), NTCL(National Tea Company Limited), NHFIL (National HousingFinance and Investment Ltd), Aramit Ltd, CDBL (CentralDepository BD Ltd), etc. This gives a picture of the stronginvestment portfolio of SBC. Comparison of the averagegrowth in investment in private sector is shown in Figure 6. Ithas shown an erratic growth over the years. For SBC, thefluctuation in growth of investment over the years iscomparatively low.80.00%Average Growth-InvestmentGrowt -20.00%20022006201020142018-120.00%Figure 6: The Average Annual Growth of Investment (Private InsuranceCompanies and SBC)Further analysis showed that the companies established in1980s have a significantly higher average investment,followed by the 1990s and 2000s companies (Figure 7 andFigure 8). The average growth of 1980s was negative in 2012,2015 and 2018. The 1990s companies also had an almost zerogrowth in investment in 2012 and 2014. The 2000s company’sgrowth was slower than normal generally. However, thecompanies observed significant growth in 2017 (over 200%).Fluctuation in investment can still be seen in both the privateand SBC with high deviations of 46% and 41% respectively.Page 718

International Journal of Research and Innovation in Social Science (IJRISS) Volume V, Issue VII, July 2021 ISSN 2454-6186Figure 7: Investment of Companies Categorized into Decades12PrimeY 4.19X 3.4757%1.08E-0313RelianceY 0.28X 4.8672%6.09E-0514RepublicY 0.22X-1.0938%1.05E-0215Sonar BanglaY 2.54X 5.8072%6.10E-0516Takaful IslamiY 4.98X 2.6497%6.87E-1117UnitedY 1.20X 4.3937%1.56E-0218Avg (Private)Y 1.59X 2.4594%2.83E-0919SCBY 0.27X 0.9596%3.71E-1020Industry AvgY 0.88x 1.9992%1.32E-083.2.2 Trend of Investment IncomeLarge portions of revenue of insurance companies come frominvestment income. Apart from the premium income,insurance companies use the income from investments as asource for further funding. In other words, it can be said thatthe general insurance companies use the premiums earnedfrom clients as capitals for investing in productive channels togenerate revenues/income. These revenues are used for furthergrowth and the settlement of claims of clients. Hence, it canbe said that increased amount of income from investmentwould make it easier for insurance companies to settle claimsand further reinvest in diversified portfolios not to mentionincrease the bottom line of the insurance company.Figure 8: Growth Rate of Investment of the Companies Categorized intoDecadesThe regression models of investment with time indicatedreliable F-significance of the models (Table 2). Overall, it isfound that all models except two companies are found to besignificant (Sig F 0.05). The coefficient of determination (R2)of the private sector is 94%, of SBC is 96%; while the wholeindustry has a value of 92%. This explained strongexplanatory power of these three models with time (SigF 0.05).Table 2: Regression Models of redFSignificance1AgraniY 11.42X 2.4692%1.83E-082BGICY 2.59X 3.0862%4.93E-043BangladeshNationY 13.38X 2.9891%2.73E-084ContinentalY 10.73X 3.0974%3.64E-055Green DeltaY 0.28X 1.6993%8.11E-096NitolY .029X 0.0958%2.84E-017MercantileY 10.61X 2.1588%2.74E-078PeoplesY 1.46X 7.3010%2.47E-019PhoenixY 1.15X 4.4779%1.09E-0510PioneerY 0.40X 6.2460%6.96E-0411PragatiY a of investment income of the general insurancecompanies showed that the average investment income ofSBC ( 6.5 million) is almost 7.6 times that of privateinsurance companies ( 792,020) but with very high deviationof 88%. Also, the income from investment of the privateinsurance companies is not very steady. It has fluctuatedconsiderably (44%) in the observed period with occasionalups and downs but much lesser than the SBC. But the averagegrowth of investment income for both SBC and private sectoris quite close (SBC’s 12% versus Private’s 10%).Figure 8 showed that the annual cumulative percentagegrowth of the total average investment income for privateinsurance companies and SBC. For private insurancecompanies it was highest in 2013 at 127%; also 2007 and2010 values were high at around the 100% mark. The SBC’sfluctuations are higher with sharp increases and falls in thesame time period reaching a high of 965% in 2011.Figure 8: The Average Annual Growth of Investment Income (PrivateInsurance Companies and SBC)Page 719

International Journal of Research and Innovation in Social Science (IJRISS) Volume V, Issue VII, July 2021 ISSN 2454-6186Analysis of the average income from investment as per yearof establishment shows that, in general, 1980s companiesinvestment income is always higher (Figure 9). Average of the2000s companies has always been lower compared to theother two categories. Sometimes this difference is quite large.From Figure 10 it can be seen that percentage change in theaverage of the 2000s companies has been mostly positiveexcept in 2011, 2015, 2016 and 2017. There were morefluctuations in the other two groups regarding this whichmeans they were less consistent or steady in their growth. 30,00,000.00 25,00,000.00 20,00,000.00 15,00,000.00 10,00,000.00 5,00,000.00 2003 2005 2007 2009 2011 2013 2015 20171980s1990s2000s6NitolY 0.031 X .0.052559%0.0005235927MercantileY 0.066 X - .03979%4.2193E-068PeoplesY 0.072 X 0.34727%0.037904499PhoenixY 0.089 X .0.10827%0.03758116510PioneerY 0.133 X .389%0.26276768111PragatiY 0.040 X .0.962%0.57177535712PrimeY 0.0017 X .0.380%0.91538324813RelianceY 0.27 X -0.30389%5.09944E-0814RepublicY 0.0307 X .0.00263%0.00023747415Sonar BanglaY 0.016 X 0.13529%0.03284976716Takaful IslamY 0.0285 X .1146%0.00365751617UnitedY 0.075 X .0.2550%0.00218667518Average(Private)Y 0.0656 X .2350%0.00225270819SBCY 0.89 X -1.5637%0.0128840420IndustryAverageY 0.011 X 0.13564%0.0002140393.3 Trend of Net ClaimsFigure 9: Investment Income of Companies Categorized into 00%20002005201020152020Figure 10: Growth Rate of Investment of Companies Categorized intoDecadesThe regression analysis showing the trend of the investmentincome noted that, all models except for four companies arereliable at 5% level of significance (Table 3). The average R2for private companies is 0.50), but for SBC it is quite low(0.37). Overall, for the industry, a significant relationship isobserved between time and the investment income (SigF 0.05, R2 0.64).Table 3: Regression of Investment IncomeSLCompanyNameRegressionEquationR1AgraniY 0.018 X .10271%3.84068E-052BGICY 0.037 X .28614%0.1535804183BangladeshNationalY 0.0495 X - .08277%8.64252E-064ContinentalY 0.016 X .0.05837%0.0131061295Green DeltaY 0.014 X 1.2418%0.101224934www.rsisinternational.org2Sig FAn insurance claim is a formal request send by a claimant toan insurance company asking for a payment based on theterms of the insurance policy. Insurance claims are reviewedby the company for their validity and then paid tothe insured or requesting party (on behalf of the insured) onceapproved. The claims’ payment can be regarded as theprimary service of insurance to the companies. Net claimsrepresent the value of claims settled during a particular yearalong with the outstanding claims of that year, which is settledin the following year. Therefore, net claims are an indicator ofthe number of claims logged in and the value of claims paidout in a particular year.A significant increase of net claims of most of the privategeneral insurance companies is observed during 2003-2018.The overall trend is a rise in net claim with some fluctuations.This trend can be observed from the average net claim of 17private insurance companies which was 0.20 million in 2003;the average then increased in 2004 and decreased in 2005.Through 2006-2010 the net claim of the private industrydepicted regular increase; the average then fell in 2011. Sincethen, the private industry has observed a steady increase in netclaim, reaching 1.7 million in 2018.When SBC is included in the calculation of the average, therewas an increase in the average net claim in all years except2011. SBC incurred the highest worth of net claims which wasover 31 million in 2018 and the lowest claims were 5.7million in the year 2003. SBC’s comparison here is verymeaningful as it has already been mentioned that it is aGovernment owned company and so has certain privileges aswell as commitments that enables it to settle much higher netclaim. Like that of private industry, the overall industry netclaim fell in 2011. From 2012 onwards, the industry’s averagePage 720

International Journal of Research and Innovation in Social Science (IJRISS) Volume V, Issue VII, July 2021 ISSN 2454-6186net claim increased reaching a net worth of 3.3 million in2018.The highest average growth rate of SBC was 107% in 2012.The average growth rate of the private insurance companieswas, on average, higher till 2011. Changes in the averagegrowth rates of the SBC were more significant. In 2005, therewas a negative growth rate of the private insurancecompanies. In 2011, both the private and SBC faced negativeaverage annual growth rate. Furthermore, SBC observednegative growth in 2013 (-29%) and 2016 (-33%), which wasprobably one of the prime reasons for the fluctuations ingrowth in following years (Figure 11).150.00%Average Growth- Net ClaimsGrowth Growth 100.00%50.00%0.496SONARBANGLATAKAFULISLAMIY .06692X0.124Y .0902X0.19485Y .00935X 0.09117UNITED18AVG 282%0.0000013315%0.135589Y .0198X 0.09841%0.007187Y .1016X-0.06294%4.42E-1075%0.00001593%2.7E-09Y 1.397 X 5.89Y 0.1735X 0.268Based on the decade of establishment (1980s, 1990s and2000s) the study has tracked their performance from theperiod between 2003 and 2018 (Figure 12 and Figure 13). Theolder companies established in 1980s are found to have highernet claims till 2013. Since then, the companies of the 1990stook over in terms of net claim settlement. There is asignificant increase in the average net claims of all thedecades.0.00%2002-50.00%2006201020142018Figure 11: The Average Annual Growth of Investment (Private InsuranceCompanies and SBC)The regression analysis (Table 4) shows the trend of the netclaim worth. Overall, we find all models except that ofTakaful Islami are found to be significant (Sig F 0.05).Overall, we find a significant relationship between time andthe net claim worth for the private companies (Sig F 0.05, R2 94%), SBC (Sig F 0.05, R2 75%), and for the industry(Sig F 0.05, R2 93%).Figure 12: Net Claims of Companies Categorized into DecadesTable 4: Regression of Net ClaimsSerialNo.Company Name1AGRANIRegressionEquationY .03012X 0.0427R2Sig F76%0.00001222BGICY .094X-0.07587%0.0000001313BANGLADESHNATIONALY 0.121X-0.34776%0.00001084CONTINENTALY 0.025X 0.5564%0.0001935GREEN DELTAY 0.322X-0.35487%0.000000186NITOLY 0.199 X-0.69276%0.00001227MERCANTILEY 0.1045X0.17365%0.0001718PEOPLESY .060X-0.144526%0.0413819PHOENIXY .0275X0.066758%0.00057910PIONEERY 0.419X-1.11696%2.5E-1111PRAGATIY .0492X-0.6248%0.00311512PRIMEY -0.0338X 0.54847%0.00357813RELIANCEY 0.1238 X 91%1.32E-08www.rsisinternational.orgFigure 13: Growth Rate of Net Claims of Companies Categorized intoDecades3.4 Trend of Profits & Profitability3.4.1 Profits: Annual Profit before TaxesAnnual profit before tax (APBT) is a profitability measurethat looks at a company's profits before the company pays thecorporate income tax. This measure deducts all expensesfrom revenue including interest expenses and operatingPage 721

International Journal of Research and Innovation in Social Science (IJRISS) Volume V, Issue VII, July 2021 ISSN 2454-6186expenses, but it leaves out the payment of tax. Profitability isthe primary goal of all business ventures. Without profitabilitythe business will not sustain in the long run.The APBT of the private general insurance companies in thestudied period showed an average of 1.1 million (deviation45%) with a growth rate of 14%. SBC had a much higherAPBT figures than any of the private companies throughoutthe period of analysis reaching a record high of 27.5 millionin 2018. Its average APBT was 13.4 million (deviation58%) with a growth rate of 13%. The industry has seen apositive trend when it c

general insurance companies, 17 private general insurance companies and the only public general insurance company (SBC) were taken for the study. SBC was established in 1973. To get a better representation the insurance companies were selected based on their year of establishment. Among the private general insurance companies 7 companies were

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