Business Model Impact on the Financial Efficiency of Insurance Companies
Purpose: The aim of the article is to examine the impact of the business model on the financial efficiency of insurance companies. Design/Methodology/Approach: A critical review of literaturę is undertaken, contents of factors which influence business models of insurance companies are analysed, and econometric methods are applied. A panel model is constructed and results of its estimation are analysed. Insurance companies have been shared according to their business models into life insurance companies and non-life insurance companies. ROE (Return On Equity) was adopted as the dependent variable (explained feature) measuring the financial efficiency of insurance companies. The models explain efficiency of insurance companies measures by ROE as dependent on thirteen independent variables. Findings: The research assumed the existence of a relationship between the business model of insurance companies and its financial efficiency. The results indicated that the variability of ROE is dependent by business model of insurance company. Factors of financial efficiency are different for life insurance companies and for non-life insurance companies. Practical Implications: The results may be taken advantage of insurance companies. They indicated factors of financial efficiency of insurance companies in sharing into life insurance companies and non-life insurance companies. Originality/Value: The paper contains the authors’ original research into a representative group of insurance companies, which can be generalised to the entity population. The study will contribute to the development of theories concerning factors of the financial efficiency of insurance companies.