Does bancassurance influence the financial performance of the insurance industry? A case study of life insurance company in a developing country

Abstract

Purpose

This study aims to examine the impacts of bancassurance contracts on the financial performance of the Egyptian insurance market from 2011 to 2022.

Design/methodology/approach

To achieve this main objective, a mixed methodological approach was adopted: a quantitative methodological approach through analyzing the content of Misr Life Insurance (MLI) Firm’s annual reports from 2011 to 2022. This period frame includes three crucial eras in the history of Egypt: the period covered by the two revolutions in Egypt, the period of political and economic stability and the COVID-19 period. Furthermore, a paired sample test was conducted for two related samples to examine the differences between the averages of financial indicators of MLI Firm for the period prior to and after the bancassurance. Additionally, a qualitative case study approach was adopted, focusing on the MLI Firm in Egypt. To support and confirm the results from quantitative content analysis, an interview was conducted with a financial manager from MLI Company.

Findings

Generally, the analysis reveals that the financial performance indicators of MLI are significantly influenced by bancassurance because of the variations between the financial performance of MLI Company before and after bancassurance, as the company’s financial performance rose after the bancassurance experience. Therefore, the current research suggests promoting awareness of bancassurance contracts in Egypt to boost financial performance and economic development through bulletins.

Research limitations/implications

The research has limitations because of its mixed methodological approach, focusing on annual reports, the Egyptian life insurance environment and the insurance sector.

Practical implications

The findings of this research are probably going to be helpful in clarifying the state of bancassurance in the Egyptian insurance industry for a wide range of interested parties, including managers, investors and scholars. More specifically, this research provides insights into MLI’s financial performance from 2011 to 2022. It aids investors in making informed decisions, boosts shareholder trust and encourages new business in the Egyptian insurance industry.

Originality/value

This research strives to establish a novel field of study, as there are few studies in developing countries that introduce empirical evidence on the impact of bancassurance on the financial performance of insurance firms in Egypt.

Citation

Ghoniem, Y.A.S.A. (2024), "Does bancassurance influence the financial performance of the insurance industry? A case study of life insurance company in a developing country", Journal of Financial Reporting and Accounting, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/JFRA-01-2024-0004