Performance assessment of branches of Iran Insurance Corporation using data envelopment analysis

Insurance industry is one of the most influential economic institutions and is considered to support other economic institutions and families. Insurance industry has been facing changes that lead it to becoming a competitive industry. Therefore, we can say insurance companies that are active in Iran insurance industry must constantly monitor performance of their branches and agencies. Ongoing problems in existing assessing methods of organizations are their emphasis on a single index and subjective judgment. Therefore, the assessment should comprehensively take all aspects into account. Subjective judgment should be reduced as much as possible. Thus, in this study we evaluate the performance of Iran Stock Corporation and its branches by using data envelopment analysis (DEA) technique. Meanwhile, in the classical applications of DEA models typically problems occur such as ignoring undesirable outputs and non-discretionary inputs. Accordingly, in this study undesirable outputs and non-discretionary inputs have been investigated. The results show that 50 and 36 percent of the branches are efficient under variable and constant returns to scale respectively in the presence of non-discretionary inputs and undesirable outputs.