Measuring Cost Efficiency of Indian Life Insurance Companies During the Post-liberalisation Era: A Farrell Approach

Authors

  • Mitrendu Narayan Roy Assistant Professor, Goenka College of Commerce & Business Administration, Kolkata
  • Siddhartha Sankar Saha Head & Professor of Commerce, Department of Commerce, University of Calcutta, Kolkata

DOI:

https://doi.org/10.33516/maj.v58i5.87-91p

Keywords:

No Keywords

Abstract

This article estimates the cost efficiencies of all Indian life insurance companies during the post-liberalisation era based on Farrell (1957) approach. Data on input and output variables and input price variables for all 24 companies have been collected from IRDA’s handbook on Indian insurance statistics. It is seen that the Indian life insurance sector is 63.5 per cent cost efficient. While LIC, Edelweiss Tokio, IndiaFirst, SBI Life, Canara HSBC OBC and HDFC Life consistently projected high cost efficiency, Future Generali, Bajaj Allianz, Aviva Life, Bharti AXA, Shriram and Reliance Nippon Life failed to achieve cost efficient status.

Downloads

Download data is not yet available.

Published

2023-05-01

How to Cite

Narayan Roy, M., & Sankar Saha, S. (2023). Measuring Cost Efficiency of Indian Life Insurance Companies During the Post-liberalisation Era: A Farrell Approach. The Management Accountant Journal, 58(5), 87–91. https://doi.org/10.33516/maj.v58i5.87-91p

Issue

Section

Insurance

References

Acharya, D. & Parida, T. K. (2016). The life insurance industry in India: Current state and efficiency. Springer.

Cooper, W. W., Seiford, L. M., & Tone, K. (2006). Data envelopment analysis: A comprehensive text with models, applications, references and DEA-solver software. Springer Science & Business Media.

Cummins, J. D., Tennyson, S., and Weiss, M. (1999). Consolidation and Efficiency in the US Life Insurance Industry. Journal of Banking and Finance, 23, 325-57.

Cummins, J. D., Weiss, M., Xie, X., and Zi, H. (2010). Economies of Scope in Financial Services: A DEA Efficiency Analysis of the US Insurance Industry. Journal of Banking and Finance.

Färe, R., Grosskopf, S., & Lovell, C. K. (1985). The measurement of efficiency of production. NJ: Springer Science & Business Media.

Farrell, M. J. (1957). The Measurement of Productive Efficiency. Journal of the Royal Statistical Society, Series A, General, 120 (3), 253-81.

IRDAI. Annual Reports (various years).

IRDAI (2021). Handbook on Indian Insurance Statistics, 2020-21.

Malhotra, R. N. (1994, January 7). Report of the committee on reforms in the insurance sector. Retrieved July 28, 2022, from https://indianculture.gov.in/ report-committee-reforms-insurance-sector-1994

Saha, S. S. & Roy, M. (2021). Efficiency of the Indian life insurance companies in the aftermath of economic global recession. A data envelopment analysis. The Management Accountant, 56(10), 92-96.

Saha, S. S. (2021). Indian Financial System: Financial Markets, Institutions and Services (2nd Ed.). Chennai: McGraw Hill.

Sinha, R. P. (2013). Are Indian Life Insurance Companies Cost Efficient? Some Recent Empirical Evidence. Prajnan, 41(3), 181-201.

Tone, K. and Sahoo, B. (2005). Evaluating Cost Efficiency and Returns to Scale in the Life Insurance Corporation of India using Data Envelopment Analysis. Socio- Economic Planning Sciences, 39, 261-85.

Tone, K. (2002). A strange case of the cost and allocative efficiencies in DEA. Journal of the Operational Research Society, 53(11), 1225-1231. doi:10.1057/palgrave.jors.2601

Similar Articles

<< < 22 23 24 25 26 27 28 29 30 31 > >> 

You may also start an advanced similarity search for this article.