This paper aims to investigate the determinants of performance for insurance companies in Tunisia from 2004 to 2017. Namely, we consider three dimensions of determinants; those related to firms’ microenvironment, macroenvironment and meso or industry environment. The performance of insurance companies is measured using three criteria: Return On Assets (ROA), Return On Equity (ROE), and Combined Ratio. The independent variables are categorized into three groups: microeconomic variables (Firm Size, Financial leverage, Capital management risk, Volume of capital, and Age of the firm), meso-economic variables (Concentration ratio and Insurance Sector Size), and macroeconomic variables (Inflation, Unemployment, and Population Growth). The General Least Squares (GLS) regression technique is employed for the analysis. The study reveals that the financial performance of Tunisian insurance companies is positively influenced by firm size, capital amount, and risk capital management. On the other hand, it is negatively influenced by leverage level, industry size, concentration index, inflation, and unemployment. In terms of technical performance, the capital amount of the firm, industry size, age of the firm, and population growth have a positive impact. However, firm size, leverage, concentration index, and risk capital management negatively affect technical performance. This paper contributes to the existing literature by examining the determinants of performance specifically for insurance companies in Tunisia. Besides the classical proxies of performance, this paper has the originality of using the technical performance which is the most suitable for the case of Insurance companies.

Abede, A. K., & Abera, M. T. (2019). Determinants of Financial Performance; Evidence from Ethiopia Insurance Companies. Journal of Accounting Finance and Auditing Studies (JAFAS), 5(1), 155–172. https://doi.org/10.32602/jafas.2019.7

Adelopo, I., Lloydking, R., & Tauringana, V. (2018). Determinants of bank profitability before, during, and after the financial crisis. International Journal of Managerial Finance, 14(4), 378–398. https://doi.org/10.1108/ijmf-07-2017-0148

Ahmed, N., Ahmed, Z., & Usman, A. (2011). Determinants of performance: A case of life insurance sector of Pakistan. International Research Journal of Finance and Economics, 61(1), 123-128.

Ajao, M.G., & Ogieriakhi, E. (2018). Firm Specific Factors and Performance of Insurance Firms in Nigeria. Amity Journal of Finance, 3(1), 14-28.

Akpan, S. S., Mahat, F., Noordin, B.-A. A., et al. (2017). Revisiting Insurance Capital Structure, Risk-Taking Behaviour and Performance between 1995 – 2002. Asian Social Science, 13(11), 128. https://doi.org/10.5539/ass.v13n11p128

Almajali, A. Y., Alamro, S. A., & Al-Soub, Y. Z. (2012). Factors Affecting the Financial Performance of Jordanian Insurance Companies Listed at Amman Stock Exchange. Journal of Management Research, 4(2). https://doi.org/10.5296/jmr.v4i2.1482

AL-Mutairi, A., Naser, H., & Naser, K. (2021). Determinants of corporate performance: Empirical evidence from the insurance companies listed on Abu Dhabi securities exchange (ADX). Accounting, 143–150. https://doi.org/10.5267/j.ac.2020.10.003

Al-Shami, H.A.A. (2008). Determinants of insurance companies' profitability in UAE [PhD thesis]. University Utara Malaysia.

Amato, L., & Wilder, R. P. (1985). The Effects of Firm Size on Profit Rates in U. S. Manufacturing. Southern Economic Journal, 52(1), 181. https://doi.org/10.2307/1058913

Asrat, L., & Tesfahun, T. (2016). Determinants of Profitability in Private Insurance Companies in Ethiopia. Journal of Poverty, Investment, and Development. 26: 85-92.

Ayele, A.G. (2012). Factors affecting profitability of insurance companies in Ethiopia: Panel evidence [Master’s thesis]. Addis Ababa University.

Bajtelsmit, V. L., & Bouzouita, R. (1998). Market Structure and Performance in Private Passenger Automobile Insurance. The Journal of Risk and Insurance, 65(3), 503. https://doi.org/10.2307/253662

Batool, A., & Sahi, A. (2019). Determinants of Financial Performance of Insurance Companies of USA and UK during Global Financial Crisis (2007-2016). International Journal of Accounting Research, 07(01). https://doi.org/10.35248/2472-114x.19.7.194

Bawa, S.K., & Chattha, S. (2013). Financial performance of life insurers in Indian insurance industry. Pacific Business Review International, 6(5), 44-52.

Beard, D. W., & Dess, G. G. (1981). Corporate-Level Strategy, Business-Level Strategy, and Firm Performance. Academy of Management Journal, 24(4), 663–688. https://doi.org/10.2307/256169

Belkhaoui, S., Lakhal, L., & Hellara, S. (2012). Impact de la structure de marché et du choix stratégique sur la performance bancaire: cas des pays émergents. Management International, 16(4), 129–149. https://doi.org/10.7202/1013154ar

Ben Naceur, S. (2003). The determinants of the Tunisian banking industry profitability: Panel evidence. University Libre de Tunis.

Benali, N., & Feki, R. (2017). The impact of natural disasters on insurers’ profitability: Evidence from Property/Casualty Insurance company in United States. Research in International Business and Finance, 42, 1394–1400. https://doi.org/10.1016/j.ribaf.2017.07.078

Berger, A. N. (1995). The Profit-Structure Relationship in Banking--Tests of Market-Power and Efficient-Structure Hypotheses. Journal of Money, Credit and Banking, 27(2), 404. https://doi.org/10.2307/2077876

Berhe, T.A., & Kaur, J. (2017). Determinants of insurance companies’ profitability Analysis of insurance sector in Ethiopia. International Journal of Research in Finance and Marketing, 7(4), 124-137.

Bourke, P. (1989). Concentration and other determinants of bank profitability in Europe, North America, and Australia. Journal of Banking & Finance, 13(1), 65-79. https://doi.org/10.1016/0378-4266(89)90020-4

Brown, T. E., Davidsson, P., & Wiklund, J. (2001). An operationalization of Stevenson’s conceptualization of entrepreneurship as opportunity-based firm behavior. Strategic Management Journal, 22(10), 953-968. Portico. https://doi.org/10.1002/smj.190

Charumathi, B. (2012). On the determinants of profitability of Indian life insurers-an empirical study. Proceedings of the World Congress on Engineering, 1(2), 4-6.

Hambrick, D. C. (1995). Speed, Stealth, and Slective Attack: How Small Firms Differ From Large Firms in Competitive Behavior. Academy of Management Journal, 38(2), 453–482. https://doi.org/10.2307/256688

Chinorwadza, T., Mutandagai, V.M., & Mutonhori, T. (2020). Determinants of Profitability in the Zimbabwean Insurance Industry from 2009-2017. Diverse Journal of Multidisciplinary Research, 2(6), 1-9.

Christophersen, C., & Jakubik, P. (2014). Insurance and the macroeconomic environment. Financial Stability Report, 1, 44-55.

D'arcy, S. P., & Gorvett, R.W. (2000). Measuring the interest rate sensitivity of loss reserves. Proceedings of the Casualty Actuarial Society, 87(167), 365-400.

Daare, W. J. (2016). Determinants of Non-Life insurance companies’ profitability: an empirical study in India. International Journal of Innovative Research and Advanced Studies, 3(13), 6-11.

Datu, N. (2016). How do insurer specific indicators and macroeconomic factors affect the profitability of insurance business? A panel data analysis on the Philippine Non-life Insurance market. The DLSU Research Congress, 4(1), 2449-3309.

Dey, N. B., Adhikari, K., & Bardhan, M. R. (2015). Factors Determining Financial Performance of Life insurance companies of India-An Empirical Study. International Journal of Economic and Business Review, 3(8), 42-48.

Doğan, M. (2013). Relations between the profitability and capital structure of insurance companies: An analysis over Turkish capital market. The Journal of Accounting and Finance, 57, 121-136.

Doumpos, M., Gaganis, C., & Pasiouras, F. (2012). Estimating and Explaining the Financial Performance of Property and Casualty Insurers: A Two-Stage Analysis. Journal of CENTRUM Cathedra: The Business and Economics Research Journal, 5(2), 155–170. https://doi.org/10.7835/jcc-berj-2012-0072

Eling, M., & Schaper, P. (2017). Under pressure: how the business environment affects productivity and efficiency of European life insurance companies. European Journal of Operational Research, 258(3), 1082–1094. https://doi.org/10.1016/j.ejor.2016.08.070

Ferrier, G. D., & Lovell, C. K. (1990). Measuring cost efficiency in banking: Econometric and linear programming evidence. Journal of Econometrics, 46(1-2), 229-245. https://doi.org/10.1016/0304-4076(90)90057-Z

Feyen, E., Lester, R., & Rocha, R. (2011). What drives the development of the insurance sector? An empirical analysis based on a panel of developed and developing countries. In Policy Research Working Papers. The World Bank. https://doi.org/10.1596/1813-9450-5572

Flamini, V., Schumacher, L., & McDonald, C. A. (2009). The Determinants of Commercial Bank Profitability in Sub-Saharan Africa. IMF Working Papers, 09(15), 1. https://doi.org/10.5089/9781451871623.001

Gaur, D., & Mohapatra, D. R. (2020). The nexus of economic growth, priority sector lending and non-performing assets: case of Indian banking sector. South Asian Journal of Business Studies, 10(1), 70–90. https://doi.org/10.1108/sajbs-01-2020-0010

Getahun, M. (2016). Capital structure and financial performance of insurance industries in Ethiopia. Global Journal of Management and Business Research, 16(C7), 55–63.

Gonga, M. A. (2017). Determinants of financial performance of insurance firms: A survey of selected insurance firms in nairobi county. Strategic Journal of Business & Change Management, 4(4). https://doi.org/10.61426/sjbcm.v4i4.551

Guru, B. K., & Shanmugam, B. (2002). Determinants of Profitability Commercial bank in Malaysia. Multimedia University.

Hailegebreal, D. (2016). Macroeconomic and Firm Specific Determinates of Profitability of Insurance Industry in Ethiopia. Global Journal of Management and Business Research, 16(7), 26-36.

Hamal, J. B. (2020). Impact of Firm Specific Factors on Financial Performance of Life Insurance Companies in Nepal. Interdisciplinary Journal of Management and Social Sciences, 1(1), 39–52. https://doi.org/10.3126/ijmss.v1i1.34510

Hasan, Md. B., Islam, S. N., & Wahid, A. N. M. (2018). The effect of macroeconomic variables on the performance of non-life insurance companies in Bangladesh. Indian Economic Review, 53(1–2), 369–383. https://doi.org/10.1007/s41775-019-00037-6

Hussain, I. (2015). Macro economy and profitability of insurance companies: a post crisis scenario in Pakistan. Pakistan business review, 17(2), 243-263.

Kripa, D., & Ajasllari, D. (2016). Factors Affecting the Profitability of Insurance Companies in Albania. European Journal of Multidisciplinary Studies, 1(1), 352. https://doi.org/10.26417/ejms.v1i1.p352-360

Lee, C. Y. (2014). The effects of firm specific factors and macroeconomics on profitability of property-liability insurance industry in Taiwan. Asian Economic and Financial Review, 4(5), 681-691.

Lenten, L. J. A., & Rulli, D. N. (2006). A Time-Series Analysis of the Demand for Life Insurance Companies in Australia: An Unobserved Components Approach. Australian Journal of Management, 31(1), 41–66. https://doi.org/10.1177/031289620603100104

Majumdar, S. K., & Chhibber, P. (1999). Capital structure and performance: Evidence from a transition economy on an aspect of corporate governance. Public choice, 98(3-4), 287-305. https://doi.org/10.1023/A:1018355127454

Malik, H. (2011). Determinants of insurance companies' profitability: an analysis of insurance sector of Pakistan. Academic Research International, 1(3), 315.

Mantis, G., & Farmer, R. N. (1968). Demand for Life Insurance. The Journal of Risk and Insurance, 35(2), 247. https://doi.org/10.2307/250834

Mazviona, B. W., Dube, M., & Sakahuhwa, T. (2017). An analysis of factors affecting the performance of insurance companies in Zimbabwe. Journal of Finance and Investment Analysis, 6(1), 1-21.

Mboga, C. (2015). The effect of interest rate on financial performance of insurance companies in Kenya [PhD thesis]. University of Nairobi.

Mehari, D., & Aemiro, T. (2013). Firm specific factors that determine insurance companies' performance in Ethiopia. European scientific journal, 9(10), 245-255.

Mintzberg, H. (1979). An Emerging Strategy of “Direct” Research. Administrative Science Quarterly, 24(4), 582. https://doi.org/10.2307/2392364

Mulchandani, K., Mulchandani, K., & Sitlani, M. (2018). External Macroeconomic Determinants and Financial Performance of Life Insurance Sector: Evidence from India. International Bulletin of Management and Economics, VIII, 114-121.

Musah, M., & Kong, Y. (2019). The association between capital structure and the financial performance of non-financial firms listed on the Ghana Stock Exchange (GSE). International Journal of Research in Social Sciences, 9(5), 92-123.

Mwangi, M., & Iraya, C. (2014). Determinants of financial performance of general insurance underwriters in Kenya. International Journal of Business and Social Science, 5(13), 210-215.

Mwangi, M., & Murigu, J. W. (2015). The Determinants of Financial Performance in General Insurance Companies in Kenya. European Scientific Journal, 11(1), 288-297.

Njegomir, V., & Stojić, D. (2011). Liberalisation and Market Concentration Impact on Performance of the Non-Life Insurance Industry: The Evidence from Eastern Europe. The Geneva Papers on Risk and Insurance - Issues and Practice, 36(1), 94–106. https://doi.org/10.1057/gpp.2010.32

Nouaili, M. A., Abaoub, E., & Ochi, A. (2015). The determinants of banking performance in front of financial changes: Case of trade banks in Tunisia. International Journal of Economics and Financial Issues, 5(2).

Öner Kaya, E. (2015). The Effects of Firm-Specific Factors on the Profitability of Non-Life Insurance Companies in Turkey. International Journal of Financial Studies, 3(4), 510–529. https://doi.org/10.3390/ijfs3040510

Pervan, M., & Kramarić, T. P. (2010). Determinants of insurance companies' profitability In Croatia., The business review, Cambridge, 16(2010), 209-216.

Pervan, M., Curak, M., & Mariajnovic, I. (2012). Dynamic panel analysis of B&H insurance companies' profitability. Recent Researches in Business and Economics, 158-163.

Primiano, S. M. (2003). Hard Market Selling: Thriving in the New Insurance Era. Polestar Publications.

Rao, N. V., Al-Yahyaee, K. H. M., & Syed, L. A. (2007). Capital structure and financial performance: evidence from Oman. Indian Journal of Economics and Business, 6(1).

Rasiah, D. (2011). Determinants of the profitability of the US banking Industry. International Journal of Business and Social Science, 2(22), 225-269.

Sambasivam, Y., & Ayele, A. G. (2013). A study on the performance of insurance companies in Ethiopia. International Journal of Marketing, Financial Services & Management Research, 2(7), 138-150.

Savvides, S. (2006). Inquiry into the Macroeconomic and Household Motives to Demand Life Insurance: Review and Empirical Evidence from Cyprus. Journal of Business & Society, 19(1/2), 37-79.

Shiu, Y. (2004). Determinants of United Kingdom General Insurance Company Performance. British Actuarial Journal, 10(5), 1079–1110. https://doi.org/10.1017/s1357321700002968

Srijanani, D., & Rao, R. S. (2019). An Analysis of Factors Affecting the Performance of General Insurance Companies in India. Gavesana Journal of Management, 11(1), 9-16.

Staikouras, C. K., & Wood, G. E. (2011). The Determinants Of European Bank Profitability. International Business & Economics Research Journal (IBER), 3(6). https://doi.org/10.19030/iber.v3i6.3699

Stiroh, K. J. (2006). New Evidence on the Determinants of Bank Risk. Journal of Financial Services Research, 30(3), 237–263. https://doi.org/10.1007/s10693-006-0418-5

Taha, T. (2015). Determinants of Profitability of Egyptian Insurance Companies Listed in Stock of Exchange. Scientific Journal of Finance; Flight, 3, 25-48.

Tegegn, M., Sera, L., & Merra, T. M. (2020). Factors Affecting Profitability of Insurance Companies in Ethiopia: Panel Evidence. International Journal of Commerce and Finance, 6(1), 1-14.

Tesfaye, T. T. (2018). Analysis of factors affecting financial performance evidence from selected Ethiopian insurance companies. International Journal of Science and Research, 7(12), 834-852.

Wali Ullah, G. M., Faisal, M. N., & Zuhra, S. T. (2016). Factors Determining Profitability of the Insurance Industry of Bangladesh. International Finance and Banking, 3(2), 138. https://doi.org/10.5296/ifb.v3i2.9954

Vojinović, Ž., Milutinović, S., & Leković, B. (2020). Micro-specific Profitability Factors of the Serbian Insurance Industry: A Panel Data Estimation. E+M Ekonomie a Management, 23(1), 135–155. https://doi.org/10.15240/tul/001/2020-1-010

Wani, A. A., & Dar, S. A. (2015). Relationship between financial risk and financial performance: An insight of Indian insurance industry. International Journal of Science and Research, 4(11), 1424-1433.