INSURANCE INDUSTRY AND NIGERIAN ECONOMY

Abstract The insurance industry plays a significant role in the economic development of any nation through risk management, savings mobilization, and investment promotion. This study examines the effect of the insurance industry on the economy of Nigeria, with emphasis on its contributions to economic growth and the challenges affecting its performance. The study adopts a descriptive research approach and relies on secondary data obtained from journals, textbooks, reports, and publications of relevant regulatory bodies. Findings from the study reveal that the insurance industry contributes to economic development by enhancing financial stability, encouraging investment, and supporting business continuity. However, the study also identifies low insurance penetration, poor public awareness, weak enforcement of compulsory insurance policies, and regulatory challenges as major factors limiting the industry’s impact on the Nigerian economy. The study concludes that strengthening regulation, improving public awareness, and promoting insurance penetration are essential for enhancing the contribution of the insurance industry to Nigeria’s economic growth. Recommendations are made to policymakers and industry stakeholders on strategies to improve the performance and relevance of the insurance sector.