Title:
Does Intellectual Capital Affect Insurance Company Profitability? Insight from Indonesia

Authors:
Dwi Rizkytawati, Falikhatun, Indonesia

Abstract:

The objective of this paper is to gather empirical information on the impact of intellectual capital consisting of human capital, structural capital, and relational capital on profitability. This research is expected to be able to contribute ideas about the relationship between intellectual capital and profitability. The observed population in this study is all conventional general insurance companies and sharia general insurance companies listed in the OJK Insurance Directory from 2017 to 2022, with samples drawn using a purposive sampling method. The sampling method obtains 216 observation data analyzed using panel data linear regression analysis. The findings show that intellectual capital components simultaneously affect a firm’s profitability. Human capital and relational capital have a partial positive impact on profitability, while structural capital has no effect on the profitability of general insurance companies. Firm size negatively affects profitability, while the interest rate variable does not. The implication of this research is able to be an input for companies, especially the insurance sector to consider intellectual capital as a factor that can affect profitability. The model robustness test conducted indicates that the core regression model has sensitivity to different proxies or measures. This study has limitations on the completeness of the data used because there are samples that do not fulfill the criteria, such as the absence of publication of financial statements.

DOI: https://doi.org/10.51505/IJEBMR.2024.8509