Effect of Ownership Structure on Dividend Policy of Listed Insurance Companies in Nigeria

Abstract

This study assessed the effect of ownership structure on dividend policy of listed insurance companies in Nigeria for the period of eleven (11) years from 2010 to 2020. Fourteen (14) out of the twenty-eight (28) listed insurance companies on the Nigerian Exchange Group were sampled. The data for the study were collected from annual reports and accounts of the sampled companies and were analyzed using descriptive statistics, correlation statistics and multiple regressions analysis using STATA software version 13.00. The study found that managerial ownership has a positive and statistically significant effect while institutional ownership has negative and significant effect on dividend policy of listed insurance companies in Nigeria. Thus, the study recommends that managerial ownership should be observed carefully by regulators and policy makers so that they do not abuse the influence they have in the company. The study also recommends that institutional ownership should be encouraged as their negative effect on dividend policy may help in checkmating managers not to excessively deplete retain earnings through excessive dividend distribution but ensure that funds are available to pursue profitable future investment.