THE IMPORTANCE AND ROLES OF INSURANCE INDUSTRY IN NIGERIAN ECONOMY
Insurance industry is a very vital aspect of Nigeria economy,and its importance and roles can not be overemphasized, in this project work the researcher want to identify the history of insurance industry in the Nigerian economy and also the actual roles and the importance of insurance industry to the common man and the society at large, such roles and importance includes in every sector of the economy, like, the banking sector, Agricultural sector, aviation sector, Business sector etc.
The research work also treated the types of insurance industry in Nigeria, here the researcher compared it with the types operated overseas, and the method used to the standard. Also the project work, focused on the problem encountered by the industry and all the necessary measures that can be used to improve Nigeria insurance up to the world’s standards.
Such problems are viz:
(a) Lack of government support;
(b) Illiteracy in the part of the common man, since Nigeria is still developing;
(c) Lack of adequate infrastructures etc. and the measures to solving them are:
i. Public awareness campaign
ii. Adequate finding by the government
iii. Co-operation of the government and the insurance industry to help improve the economy etc.
1.1 BACKGROUND OF THE STUDY
The development of insurance industry, in Nigeria has passed through three distinguishable phases: the initial open door phase, roughly between 1990 and 1960, the transitional phase which concludes with the first national development plan period, 1962 – 1969 and the take off phase (1990 to the present times), witness the toughening of the framework of government regulation and represents a radical change in government’s attitude toward the control the industry.
THE COLONIAL ERA: There was when the insurance market were dominated with European companies who monopolies the insurance industry, during this early period, a number of factors did not ensure an active market. Economic activity is at low level, there was no insurance consciousness by the populace, due to non-existence of some legislation, like that of motor vehicle and other things, it made Nigerian market to grow in a low pace and also the third world war hindered the growth of the market.
After the war, Nigeria experienced a lot of improvement, and after that was the introduction of the worker’s compensation act of 1940 and the road traffic act of 1945 which came into force on 1st April 1950. Due to the increase in insurance industry in Nigeria.
TRANSITIONAL PHASE: This was after Nigeria had their, independent, there was a rapid increase in the number of company establishment, and an increase in insurance industries and some of the foreign companies were turned to indigenous companies. The first step was to regulate the operations of the insurance companies to ensure a sound and efficiency insurance market, which would not only discharge its duties to members of the insuring public but would constitute the solid foundation for future growth and development.