Product diversification versus technical efficiency of conglomerate life microinsurance companies: evidence from India

Savitha, B and Banerjee, Subrato and Shetty, Ankitha (2019) Product diversification versus technical efficiency of conglomerate life microinsurance companies: evidence from India. Geneva Papers on Risk and Insurance: Issues and Practice, 44 (3). pp. 527-547. ISSN 10185895

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Abstract

We look at technical efficiency and productivity changes in the life microinsurance (LMI) portfolio of insurance companies in India. The central objective is to empirically examine the ‘tug of war’ between efciency and product diversity in the Indian insurance market. The data used in this research is available in the Handbook on Indian Insurance Statistics (Insurance Regulatory and Development Authority of India). First, we emphasise that four-fifths of LMI insurers in our sample were technically inefcient. Second, through the use of the data envelopment approach (DEA), Malmquist total factor productivity index (MTFP), and Tobit regression analyses, we demonstrate that insurers could improve managerial ability by organising inputs in the production process more efectively. Finally, we provide empirical support for the strategic focus hypothesis by demonstrating that product diversification has adverse efects on the technical efciency of insurers.

Item Type: Article
Uncontrolled Keywords: Life microinsurance · Technical efficiency · Product diversification · Data envelopment analysis · diversification · Productivity
Subjects: Management > MIM Manipal
Depositing User: MIM User
Date Deposited: 21 Jun 2019 04:58
Last Modified: 21 Jun 2019 04:58
URI: http://eprints.manipal.edu/id/eprint/154039

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