THE ROLE OF RISK MANAGEMENT STRATEGIES IN ENHANCING INSURANCE PERFORMANCE

Abstract

This study explores the critical role of risk management strategies in improving the performance and sustainability of insurance companies. As the insurance industry operates in an environment characterized by uncertainty and exposure to various financial and operational risks, effective risk management is essential to maintaining solvency, enhancing profitability, and ensuring customer trust. The research investigates different risk management approaches—including risk identification, assessment, mitigation, and transfer—and their impact on key performance indicators such as loss ratios, claim settlement efficiency, and capital adequacy. Using a mixed-methods approach, the study analyzes data from leading insurance firms and industry reports to identify best practices and challenges in implementing risk management frameworks. The findings highlight that insurers with robust and adaptive risk management strategies are better equipped to withstand market volatility and regulatory pressures, ultimately leading to improved operational performance and competitive advantage. This research contributes to the understanding of how strategic risk management integration can drive value creation in the insurance sector.