Analysis of caramel model as a financial performance indicator in the insurance sector

Abstract

Due to the Covid-19 situation, all the people of our country started to buy more insurance policies which improve the financial performance of insurance companies. Insurance companies are in the core business of managing the risk of individuals and corporations. The Indian industry needs a deep analysis of the various factors affecting its financial performance. So for analyzing the working of an insurance company, different financial indicators are well explained in the CARAMEL model. The core objective of the study is to determine the factors which are helpful to analyze the financial performance of Insurance Companies. After the research study, the researcher has concluded that the financial health of an individual insurer or insurance sector as a whole is a difficult task. So it needs to take both the primary and secondary work in the research area for the reliability aspect. These are the various ratios helpful to analyze the financial performance that are Capital Adequacy, Asset Quality, Reinsurance Actuarial Ratio, Management Soundness, Earnings/Profitability, and Liquidity Ratio.