Corporate Insurance Strategy and Value Creation in Quoted Nigerian Companies: A Stakeholder Theory Perspective

This dissertation examines corporate insurance strategy and its contribution to shareholder and stakeholder value creation in companies quoted on the Nigerian Exchange Group (NGX), analyzed through a stakeholder theory framework. Corporate insurance decisions, encompassing risk retention versus transfer, product class selection, and insurance cost management, are theorized to create value through tax benefits, financial distress cost reduction, investment incentive alignment, and employee and supplier relationship stabilization. While corporate finance theory has generated substantial empirical literature on insurance and firm value in developed markets, evidence from Nigerian capital markets remains fragmentary. This study employs a panel data design using financial, insurance expenditure, and governance data for fifty non-financial firms quoted on the NGX from 2015 to 2023. Insurance expenditure is reconstructed from notes to financial statements and supplementary data from insurance companies. Firm value is measured using Tobin's Q and market-to-book ratio. Panel regression with instrumental variable correction for insurance endogeneity tests the core value creation hypotheses. The study also employs event study methodology around major loss events to assess the market's pricing of insurance adequacy signals. Stakeholder dimension effects are analyzed by decomposing value creation pathways through employee, creditor, and supplier relationship channels. Keywords: Corporate Insurance Strategy, Firm Value, Stakeholder Theory, Nigerian Exchange Group, Panel Data.