The Size and Structure of Market and Efficiency of Insurance Companies in Azerbaijan and Iran countries

The main purpose of the present research is to determine appropriate structure concerning the size and volume of insurance companies in order to increase the performance, efficiency, and to decrease the average costs of production. Increasing the performance of an insurance company is effective in economic growth and development, monetary and financial stability and economic savings. Under consideration, statistical universe of this research is Azarbayjan and Iran insurance Companies that have been active in insurance Companies market during 2008, 2009 and2010.In order to test the assumptions of the research, information about financial statements of insurance companies has been studied and analyzed during the three years of 2008, 2009and2010 by using method data envelopment analysis. Findings from the research show that insurance companies in Azarbayjan with large size and more share than market enjoy the highest performance compared to other companies. In addition, insurance companies in Iran with small size and fewer shares than market enjoy the highest performance compared to other companies. Because of centralization and asymmetric information, large companies with more share than insurance market are encountered with deficiencies and decentralization, removing the monopoly from insurance company seems necessary, and this will be realized by establishing insurance companies with more capital, integrating, and combining them with each other. Improvement in market structure will lead to increase in performance and economic savings of insurance companies. Increase in economic savings at economic macro levels will result in increase in insurance coefficient penetration, satisfaction of insured parties and growth and flourish in insurance industry.