Insurance Sector Performance and the Nigeria’s Economic Growth

The study examines insurance industry’s contribution to economic growth in Nigeria. For estimation analysis, the study employed Autoregressive Distributive Lag (ARDL) bond test, Error Correction Mechanism (ECM) and Diagnostic test.). The findings revealed that at 5% level of significance in the short run, life premium (LP) related positively with growth rate (GR) in an insignificant manner while non-life premium (NLP) contributed negatively and insignificantly to growth rate. However, in the long run, life and nonlife insurance premium influences the growth of the Nigerian economy. Therefore, the study concludes that without insurance coverage, substantial emergency funds would be looked-for to protect firms against risks. Based on the findings, the study recommends among others that life insurance companies should come up with life products mainly designed for the low-paid earners to enhance penetration, deepen the market and to create more awareness to improve the participation of product industry and firms as this will intensify the activities of the insurance industry in Nigeria. Also, insurance companies should increase diversification of insurance products mostly in non-life businesses being embarked upon.