Risk Management and Its Impact on the Performance of Insurance Companies: The Case of Kosovo

Experience of successful businesses in the insurance field has shown that risk management provides wealth preservation and growth, enhancing reputation regardless of scope, taking into account the fact that the risk is not only a threat, but it also presents opportunities if the insurance company is prepared in time to handle it adequately. International studies show that insurance companies with good risk management have better return on equity and better performance in other key business indicators in comparison with competitors who do not give great importance to risk management. This study will use structured questionnaires to explore the extent of the application of risk management in insurance companies in Kosovo and its impact on their business performance. Also, the annual reports of companies are used to see the financial performance of companies. The hypothesis of this study relates to the impact of risk management in the financial performance of companies participating in the study. Thus, it can be understood that the information provided may present the situation of the sector and behavior of the insurance market in Kosovo in terms of risk management policies and how they influenced modern risk management in the company's financial performance in the insurance market of Kosovo. Hence, these data can be of great interest to any other local companies to prompt them to put risk management at the top of their agenda when it is known that in this area remain behind shell companies in the region and EU 's.