This study aims to test and analyze the effect of Environmental, Social, and Governance (ESG) performance, operational capacity, claims ratio, and liquidity on financial distress in insurance companies in Indonesia, with Risk-Based Capital (RBC) as a moderating variable. Utilizing a quantitative approach, the research involves a saturated sampling technique and focuses on 18 insurance companies listed on the Indonesian Stock Exchange (IDX). Regression analysis using panel data, supported by Eviews 12, reveals that ESG performance and liquidity do not significantly affect financial distress. Operational capacity positively influences financial distress, while claims ratio negatively impacts it. Additionally, RBC does not moderate the relationship between ESG or liquidity and financial distress, but it does moderate the effect of operational capacity and claims ratio on financial distress. These findings contribute to understanding the financial stability of insurance companies in Indonesia.
Mahendra et al. (Tue,) studied this question.
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