ANALYSIS OF THE INFLUENCE OF LEVERAGE RATIO, PREMIUM GROWTH RATIO, LOSS RATIO AND UNDERWRITING RESULT TO PROFITABILITY OF INSURANCE COMPANY (EMPIRICAL STUDY OF INSURANCE COMPANIES LISTED IN INDONESIA STOCK EXCHANGE YEAR 2007 - 2012)

Abstract

Insurance industry is one of sectors that constantly growth in Indonesia. With that growth, the performance of any business firm including insurance sector becomes very essential to management as an achieved. Profitability is a very important determinant of company performance. Therefore, it draws the researcher to analyze the further study about the effect of Leverage Ratio, Premium Growth Ratio, Loss Ratio, and Underwriting Result to the profitability of Insurance Company. This research is empirical study of insurance companies listed in Indonesia Stock Exchange with the period of observation is 2007-2012 (annually). Through purposive sampling and pooling data, the number of sample is nine and total number of observation is fifty four. Based on the test for normality, multicollinearity, heteroscedasticity and autocorrelation test indicated that the available data has been qualified to use the model of multiple regression equation for this research. Based on the result, it’s concluded that in case nine insurance companies period 2007-2012, there are Leverage Ratio, Loss ratio, and Underwriting Result which having significant influences to Profitability (ROA). On the other hand, Premium Growth Rate has no sigificant influences to Profitability (ROA).