Macroeconomic factors affecting performance of insurance companies in Malaysia

Abstract

This study has empirically investigated the impact of macroeconomic factors towards the performance of insurance companies in Malaysia. Data were collected from six insurance companies listed in Bursa Malaysia from year 1996-2015. Macroeconomic factors measured by Gross Domestic Product (GDP), Consumer Price Index (CPI) and Interest rate (IR), while company preference is indicated by Return on Asset (ROA). Multiple Linear Regression was used to examine the degree of the relationship of macroeconomics factors towards company's performance. The results conclude that GDP and IR affect the company's performance while CPI gives less impact towards the company's performance. This study contributed to the current understanding of what are the factors influencing Malaysia insurance companies' performance. By understanding the factors, strategic implementation can be taken to improve companies' profitability in the market.