Insurance companies now play a significant role in the growth of financial services, which ultimately leads to the overall success of the economy. The study's major goal was to look at the factors that influence the capital structure of insurance companies in Ethiopia over an eleven-year period. Despite numerous previous studies on the factors that influence capital structure, the question of what factors define the optimal financing mix for maximizing a company's value remains the most contentious in corporate finance. As a result, this research aimed to bridge the gap by examining the capital structure determinants of Ethiopian insurance companies. Six firm-level explanatory variables (profitability, tangibility, firm size, growth, business risk, and age) and two macro-level factors (GDP and inflation) were selected and regressed against the leverage (debt to asset ratio). As regards this study, it used a quantitative research approach, an explanatory research design, and a descriptive research design. This study used secondary data types that audited financial statements used. The data required for the variables was collected from the national bank of Ethiopia and the World Bank, which purposively selected 10 sample insurance companies in Ethiopia. The analysis of the study was conducted using multiple leaner regressions based on descriptive and inferential statistics on insurance companies over the study period of 2012–2022 G.C. In the same manner, the study used a random effect regression model. The major finding of the study was that growth opportunity, business risk, firm size, and inflation variables are positively and statistically significant determinates of the capital structure. Among these, profitability and tangibility variables are negatively and statistically significant at a 5% level. Conversely, gross domestic product has a positive relationship with leverage, and the age of the firms’ variables has a negative relationship with leverage. However, the strength of the variables, both age and gross domestic product, is insignificant at a 5% significance level. The study recommended that in determining and properly measuring the influence of those significant variables on leverage in order to set the most influential theory of pecking order theory, great attention be paid to decision-making and maximizing their firms' value.