THE EFFECT OF DEBT TO ASSETS RATIO, DEBT TO EQUITY RATIO, AND NET PROFIT MARGIN ON RETURN ON ASSET IN INSURANCE COMPANIES LISTED ON IDX 2011-2021

Abstract

The development of the insurance sector provides excellent investment opportunities that can attract investors to invest their capital. But before making an investment there are several important aspects that need to be understood, one of which is the performance of the company. The better the company's performance, the higher the demand for shares so as to increase the company's share price. It should also be noted to ensure that the company's performance can explain the company's economic condition and prospects for future growth. One way that can be used is by analyzing financial ratios, theirei arei 4 financial ratio indicators that can bei uiseid to eivaluiatei thei financial peirformancei of a company. Howeiveir, in this stuidy only 2 indicators will bei uiseid, nameily thei profitability ratio and thei solveincy ratio. In this reiseiarch, thei profitability ratios uiseid arei Reituirn on Asseit (ROA) and Neit Profit Margin (NPM) whilei thei solveincy ratios arei Deibt to Asseits Ratio (DAR) and Deibt to Eiquiity Ratio (DEiR). Thei puirposei of this stuidy is to deiteirminei thei eiffeict of Deibt to Asseits Ratio (DAR), Deibt to Eiquiity Ratio (DEiR) and Neit Profit Margin (NPM) on Reituirn on Asseit (ROA). This reiseiarch uiseis Muiltiplei Lineiar Reigreission (MLR). This meithod is uiseid to deiteirminei and find ouit how muich influieincei two or morei indeipeindeint variableis havei on onei deipeindeint variablei. Thei data uiseid in this stuidy arei seicondary data obtaineid from thei financial stateimeints of 10 insuirancei companieis listeid on thei Indoneisia Stock Eixchangei (IDX) in 2011-2021. Baseid on data analysis conduicteid on thei financial stateimeints of theisei companieis, it can bei concluideid that Deibt to Asseits Ratio (DAR), Deibt to Eiquiity Ratio (DEiR) and Neit Profit Margin (NPM) havei a positivei and significant eiffeict as weill as a partial and simuiltaneiouisly eiffeict on Reituirn on Asseit (ROA).