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Chapter One of Life Assurance Patronage and Its Implication on the Nigeria Economy
Abstract of Life Assurance Patronage and Its Implication on the Nigeria Economy
This study examines the implication of life assurance patronage on the Nigeria economy. The nature of life insurance business should do with the indemnification of the insured or the insured’s beneficiary on the maturity of the life insurance contract or on the death of the life assured. Life insurance patronages in Nigeria are confronted with several challenges that hinder its impact on the Nigeria economy which include; inflation, political instability, low domestic saving, customers lack familiarity with life assurance products, interest rate and low income. However, the objective of this study is to show the implication of life assurance gross premium on insurance companies assets, to examine life assurance business in Nigeria, to examine the implication of life assurance patronage and hence its importance to the Nigeria economy. In order to achieve the objectives of this study, data were collected from secondary sources and analyzed descriptively. In testing the research hypotheses, the simple linear regression was used. The result showed an R2 value of 0.754 which indicates that 75.40% of the variations in total assets of insurance companies (TAIN) can be explained by the independent variable which is life assurance gross premium (LAGP) while the remaining 24.60% would be due to other factors not considered in the model. At 5% level of significance and f-value of 24.562 which is greater than the table value of 5.978, the null hypothesis was rejected and the alternative hypothesis was accepted which established that there is a significant relationship between life assurance gross premium and the total asset of insurance companies (which is the economic indicator for this study), which implied that there is a significant relationship between life assurance patronage and the Nigeria economy. This study reveals that life assurance patronage affects Nigeria economy positively through the funds accumulated from life assurance patronage. It is recommended that there should be; proper management of fraudulent activities, proper and effective awareness of life insurance products, development of domestic financial market, and provision of professional training for all life insurance staffs
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