EXPLORING THE RELATIONSHIP BETWEEN PREMIUM GROWTH, CLAIM EXPENSES, AND SOLVENCY: THE MEDIATING EFFECT OF PROFITABILITY

Abstract

This study aims to examine the effect of premium growth and claim expenses on solvency levels with profitability as an intervening variable. This research uses a quantitative approach using secondary data. The population in this study were 18 insurance companies listed on the Indonesia Stock Exchange (IDX) in 2018-2022. The sample used amounted to 14 insurance companies (consisting of 70 data) obtained using purposive sampling method. The results showed that: (1) premium growth has no significant effect on profitability; (2) claim expense has no significant effect on profitability; (3) premium growth has no significant effect on solvency level; (4) claim expense has no significant effect on solvency level; (5) profitability has a negative and significant effect on solvency level; (6) profitability is not able to mediate the effect of premium growth on solvency level; (7) profitability is not able to mediate the effect of claim expense on solvency level.