Title

A study on the relationship of investment yields with respect to the chosen attributes of twenty-five life insurance firms in the Philippines

Date of Publication

2014

Document Type

Bachelor's Thesis

Degree Name

Bachelor of Science in Commerce Major in Management of Financial Institutions

Subject Categories

Finance and Financial Management

College

Ramon V. Del Rosario College of Business

Department/Unit

Financial Management Department

Thesis Adviser

Ester Guerzon

Defense Panel Chair

Ricarte Q. Pinlac

Defense Panel Member

Rene Betita
Angelito Bala

Abstract/Summary

The purpose of this study is to determine the relationship between the investment yields and chosen attributes of twenty-five selected life insurance firms. The primary objective of a life insurance firm is to protect policyholders like individuals and corporations from an unfavorable turn of events. Life insurance firms are then financially liable to their policyholders if certain adverse events take place. With the premium payments collected, insurance firms invest in securities to increase their revenue given that investment income represents a large portion of their earnings. Because investment plays a significant role in their returns, insurers determine key indicators that influence investment yields. Given this rationale, the researchers examined the hypothesis that firm-specific factors, specifically, firm size, leverage, asset mix, underwriting risk, and liquidity influence the behavior of investment yields of life insurance firms. Initially, this study made use of the ordinary least squares model but due to its inadequacy, the researchers deviated to using the fixed effects model as its final regression model. In favor of the expected results, investment earnings demonstrated to be higher for large-sized life insurance firms and also those with a high underwriting risk. This suggests that size and risk level is a good measure for a firm's investment management. Although leverage and liquidity displayed positive coefficients, it turned out to be unrelated to their investment yields. Furthermore, firms holding more financial assets resulted to a negative coefficient in which the asset mix was also concluded to be unrelated to their investment yields.

Abstract Format

html

Language

English

Format

Print

Accession Number

TU21605

Shelf Location

Archives, The Learning Commons, 12F, Henry Sy Sr. Hall

Physical Description

74, [9] leaves

Keywords

Life insurance--Philippines

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