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Strategic Responses to the Declining Underwriting Profitability in Insurance Industry in Kenya Particularly In General Insurance

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dc.contributor.author Mbataru, Mary Nyokabi
dc.date.accessioned 2018-11-09T07:22:56Z
dc.date.available 2018-11-09T07:22:56Z
dc.date.issued 2018
dc.identifier.uri http://erepo.usiu.ac.ke/11732/4101
dc.description A Project Submitted to the Chandaria School of Business in Partial Fulfillment of the Requirement for the Degree of Masters in Business Administration (MBA) en_US
dc.description.abstract The purpose of this study was to establish the strategic responses being adopted by General Insurance companies in Kenya to address underwriting profitability. The study was guided by three research questions. This sought to establish underwriting strategies being employed to address underwriting profitability, the claims strategies being employed to address underwriting profitability and the product development strategies being employed to address underwriting profitability. The research adopted a descriptive research and the study targeted a total population of 141 employees’ in the general insurance. The stratified simple random sampling technique was used as it was effective for the study. A sample of 59 questionnaires was considered adequate and was arrived at using Yamane formula although only 58 respondents returned the questionnaires. The tool used to collect the data was a structured questionnaire. The statistical package for social sciences (SPSS Version 25) data analysis software was used to analyze data based on descriptive and inferential statistics. The study also used a correlation analysis and regression analysis that established the relationship between the dependent variable and the independent variables and data was presented using tables and figures. A Pearson correlation was done to establish the relationship between underwriting profitability and other factors and the findings revealed that there was a positive relationship between underwriting profitability and underwriting strategies employed. The regression analysis showed that variation in underwriting profitability was explained by the variations in underwriting strategies. A Pearson correlation done to establish the relationship between underwriting profitability and claim strategies also revealed that there was a positive relationship between underwriting profitability and claim strategies employed. The regression analysis showed that variation in underwriting profitability was explained by the variations in claim strategies. A Pearson correlation done to establish the relationship between underwriting profitability and product development strategies also revealed that there was a positive relationship between underwriting profitability and product development strategies employed. The regression analysis showed that variation in underwriting profitability was explained by the variations in product development claim strategies. It was concluded that having the right technical skill is very essential to ensure underwriting profitability, in addition, the pricing and profiling strategies employed are very vital in determining the profitability levels enjoyed by a firm. Strategic partnership and relationship management is highly encouraged and this could be attributed to motivating gaining of complement resources and capabilities and that the strategic partnership thus contribute towards organizational performance of the insurance firms in Kenya. Secondly, fraud detection is a challenge in the sector and urgent action needs to be taken by the Government and its agencies such as IRA and IFIU as well as individual insurance providers and their associations if there is an intention to improve underwriting profitability. Lastly, product mix strategy offers competitive pricing for profitable channels and there are customized Product scope design; benefits, terms, limits to suit the various market needs. The study recommended that the firms should seek to have underwriting governance, processes and controls matrixes that and risk surveys and experience adjustments hence significantly improve account profitability performance and continuously measures underwriting results as a key performance indicator (KPI) in order to improve performance. Secondly, more emphasis should be put on fraud detection and investigation as a measure of improving underwriting profitability. There is a need to adopt digitalization of technologies, and there is also a need for consumer/members education programs, this will ensure the consumers better understand their role in the insurance contracts. Lastly, in order to guarantee successful products, a thorough Market Research (Research driven product design) should be undertaken to establish customer needs. The firm also need to create more awareness in the Product Service Models through their digital platforms. en_US
dc.language.iso en en_US
dc.publisher United States International University - Africa en_US
dc.subject Strategic Responses en_US
dc.subject Declining Underwriting Profitability en_US
dc.subject Insurance Industry en_US
dc.subject Kenya en_US
dc.subject General Insurance en_US
dc.title Strategic Responses to the Declining Underwriting Profitability in Insurance Industry in Kenya Particularly In General Insurance en_US
dc.type Thesis en_US


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