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Balancing Innovation and Profitability: Technological Diversification in Iran’s Insurance Industry

Author

Listed:
  • Shojaei Seyed Amirhossein

    (Faculty of Business and Management, 516898 Muscat University , Muscat, Oman)

  • Almansour Bashar Yaser

    (Faculty of Business and Management, 516898 Muscat University , Muscat, Oman)

Abstract

This study explores how technological diversification affects financial performance in Iran’s insurance industry. Using semi-structured interviews with six experts, including CEOs and faculty members, key indicators of technological diversification were identified, such as new underwriting software and digital advertising platforms. A 33-item questionnaire was developed based on these insights and distributed to top managers of Iranian insurance companies, with secondary financial data sourced from the Central Insurance of Iran. The study employes regression analysis and Partial Least Squares Structural Equation Modeling (PLS-SEM) to assess the impact of technological diversification on financial performance, controlling for firm size, debt ratio, and company age. Findings indicate a significant negative relationship between technological diversification and both Return on Equity (ROE) and Return on Assets (ROA), suggesting that the costs of adopting new technologies may outweigh their short-term financial benefits. Additionally, high debt ratios were found to adversely affect ROA, highlighting the financial risks of excessive borrowing.

Suggested Citation

  • Shojaei Seyed Amirhossein & Almansour Bashar Yaser, 2025. "Balancing Innovation and Profitability: Technological Diversification in Iran’s Insurance Industry," Asia-Pacific Journal of Risk and Insurance, De Gruyter, vol. 19(1), pages 1-25.
    • Handle: RePEc:bpj:apjrin:v:19:y:2025:i:1:p:1-25:n:1002
    DOI: 10.1515/apjri-2024-0011
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    More about this item

    Keywords

    technology; diversification; technological diversification; financial performance; insurance; Iran;
    All these keywords.

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • G22 - Financial Economics - - Financial Institutions and Services - - - Insurance; Insurance Companies; Actuarial Studies
    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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