Porter's Generic Strategies and Performance of Insurance Companies in the North Rift, Kenya

The study was based on the insurance industry and provided an understanding of the nature of porters’ generic strategies and how they influenced performance of insurance firms in the North Rift region of Kenya. The study was guided by objectives drawn from porters’ generic strategies of cost leadership strategy and differentiation strategy and how they influenced performance. The study adopted a cross-sectional survey design based on a population that targeted 28 insurance companies operating in North Rift Region. From a population of 1144 agents, a sample 296 agents were identified using Cochran (1977) formula. This study was grounded on Porter’s Theory of Competitive Advantage. Data concerning the independent variables was collected using questionnaires and document analysis from published financial reports to capture relevant data for ROA computation. Collected data was analyzed quantitatively using descriptive and inferential statistics (correlation and regression analysis), with the assistance of Statistical Package for Social Sciences (SPSS v29). All tests were done at 5% significance level. The study findings indicated that 65.4% of the performance was explained by the variables (R2 = .654) in the model. This was significant as indicated by p value of 0.05. Both variables were significant in influencing performance i.e. cost leadership strategy (P=0.005) and differentiation strategy (p=0.002) of performance of insurance companies operating in the North Rift region of Kenya. The study recommended for further research work to be conducted to review the influence of other variables on performance of insurance companies operating in the North Rift region of Kenya. The study contributed immensely to the body of knowledge (literature, theory and policy) in strategic management. Keywords: Cost Leadership Strategy, Differentiation Strategy, Performance, Porter’s Generic Strategies