Nigerian Journal of Banking and Financial Issues (NJBFI)
The Impact Of Insurance On Economic Growth In Nigeria
Keywords:
Gross Domestic Product (GDP), Total Insurance Premium (TPR, Total Insurance Claim (TIC), Total Insurance Investment (INV) and Inflation Rate (INTR)Abstract
This study examined the impact of insurance on economic growth in Nigeria from 1986 to 2020.
Using short run ordinary least square (OLS) model. The present study utilizes Real Gross Domestic Product (RGDP) as a proxy for economic growth, serving as the dependent variable while Total
Insurance Premium (TPR), Total Insurance Claim (TIC), Total Insurance Investment (INV) and Inflation Rate were used as the explanatory variables. Short run of OLS result revealed that value total insurance claims, total insurance claim, total insurance investment and inflation rate had an insignificant impact on economic growth while total insurance premium has a significant relationship on economic growth. However, in the short run, insurance firm’s indicator had a positive impact on economic growth in the short run and concluded that insurance firms indices has a positive impact on economic growth in the short run. Therefore, recommended that insurance policies be made mandatory for individuals and business organizations to encourage and protect investors as well as ensure sustained economic growth; that the regulatory authorities should put in place policies to enforce transparent and efficient management of funds by insurers; that investors should diversify their portfolio of investments to boost returns and their ability in claims payment.
