Measuring technical efficiency of insurance companies using dynamic network DEA: an intermediation approach
This study measures technical efficiency of the Malaysian insurance companies using a new framework for performance efficiency, built on the intermediation approach, by decomposing the complex service processes of insurance companies into two functional divisions, premium accumulation and investmen...
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Vilnius Gediminas Technical University
2018-10-01
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doaj-5fb18a578ed442c69536a647d1d5f24f2021-07-02T04:03:35ZengVilnius Gediminas Technical UniversityTechnological and Economic Development of Economy2029-49132029-49212018-10-0124510.3846/20294913.2017.1303649Measuring technical efficiency of insurance companies using dynamic network DEA: an intermediation approachMohammad Nourani0Evelyn Shyamala Devadason1VGR Chandran2Faculty of Economics and Administration, University of Malaya, Jalan Universiti, 50603 Kuala Lumpur, MalaysiaFaculty of Economics and Administration, University of Malaya, Jalan Universiti, 50603 Kuala Lumpur, MalaysiaFaculty of Economics and Administration, University of Malaya, Jalan Universiti, 50603 Kuala Lumpur, Malaysia This study measures technical efficiency of the Malaysian insurance companies using a new framework for performance efficiency, built on the intermediation approach, by decomposing the complex service processes of insurance companies into two functional divisions, premium accumulation and investment capability. The study employs a dynamic network data envelopment analysis for performance evaluation of insurer (life, general and composite insurers) and ownership (local and foreign) types, spanning the period 2007–2014. The findings reveal a lack of efficiency in the investment capability function among local insurers as compared to their foreign counterparts. While the composite or non-specialized segment performs better in the investment capability function, the general segment achieves better efficiency in the premium accumulation function. The results suggest the high usage of input quantities and lack of total investment as key reasons for low efficiency, particularly among the local insurers. Implications for business excellence for insurance companies are further discussed. https://journals.vgtu.lt/index.php/TEDE/article/view/5472performance evaluationdata envelopment analysisintermediation approachdynamic network slacks-based measureinsurance companies |
collection |
DOAJ |
language |
English |
format |
Article |
sources |
DOAJ |
author |
Mohammad Nourani Evelyn Shyamala Devadason VGR Chandran |
spellingShingle |
Mohammad Nourani Evelyn Shyamala Devadason VGR Chandran Measuring technical efficiency of insurance companies using dynamic network DEA: an intermediation approach Technological and Economic Development of Economy performance evaluation data envelopment analysis intermediation approach dynamic network slacks-based measure insurance companies |
author_facet |
Mohammad Nourani Evelyn Shyamala Devadason VGR Chandran |
author_sort |
Mohammad Nourani |
title |
Measuring technical efficiency of insurance companies using dynamic network DEA: an intermediation approach |
title_short |
Measuring technical efficiency of insurance companies using dynamic network DEA: an intermediation approach |
title_full |
Measuring technical efficiency of insurance companies using dynamic network DEA: an intermediation approach |
title_fullStr |
Measuring technical efficiency of insurance companies using dynamic network DEA: an intermediation approach |
title_full_unstemmed |
Measuring technical efficiency of insurance companies using dynamic network DEA: an intermediation approach |
title_sort |
measuring technical efficiency of insurance companies using dynamic network dea: an intermediation approach |
publisher |
Vilnius Gediminas Technical University |
series |
Technological and Economic Development of Economy |
issn |
2029-4913 2029-4921 |
publishDate |
2018-10-01 |
description |
This study measures technical efficiency of the Malaysian insurance companies using a new framework for performance efficiency, built on the intermediation approach, by decomposing the complex service processes of insurance companies into two functional divisions, premium accumulation and investment capability. The study employs a dynamic network data envelopment analysis for performance evaluation of insurer (life, general and composite insurers) and ownership (local and foreign) types, spanning the period 2007–2014. The findings reveal a lack of efficiency in the investment capability function among local insurers as compared to their foreign counterparts. While the composite or non-specialized segment performs better in the investment capability function, the general segment achieves better efficiency in the premium accumulation function. The results suggest the high usage of input quantities and lack of total investment as key reasons for low efficiency, particularly among the local insurers. Implications for business excellence for insurance companies are further discussed.
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topic |
performance evaluation data envelopment analysis intermediation approach dynamic network slacks-based measure insurance companies |
url |
https://journals.vgtu.lt/index.php/TEDE/article/view/5472 |
work_keys_str_mv |
AT mohammadnourani measuringtechnicalefficiencyofinsurancecompaniesusingdynamicnetworkdeaanintermediationapproach AT evelynshyamaladevadason measuringtechnicalefficiencyofinsurancecompaniesusingdynamicnetworkdeaanintermediationapproach AT vgrchandran measuringtechnicalefficiencyofinsurancecompaniesusingdynamicnetworkdeaanintermediationapproach |
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