This research work examined by An Evaluation of Insurance Reforms in Nigeria. The study become a necessity due to the fact that there are still various goals and objective of the insurance reforms, the impact of the reforms on the industry, the performance of the industry after the reforms on the and to evaluate the Effectiveness of the reforms in the industry to achieve this objectives, primary source of date were gathered and descriptive method of investigation was used. Two hypothesis were tested using the chi-square (X2) the findings reveals that the reforms has not played a significance role in enhancing patronage of insurance business product and ensuring a significant increase in the contributions of the industry to the national economy. It was conduced that although the reforms have some positive achievement in the industry more could still be done to ensure that it yields better productivity and efficiency for the industry. It was therefore recommended that compulsory insurance products could be introduced as strong regulatory bodies be put in place and also the need for continuous reform exercise in the insurance industry.       




A major development in the financial sector of the Nigerian economy is the advent of insurance business. Insurance can be rooted for back to 1900 but its first significant indigenous incursion took place in 1969 when the National Insurance Corporation of Nigeria (NICON) was established. The practice of insurance business has growth dramatically since its existence in Nigeria and is now a major mechanism that reduces the adverse impact f loss caused by risk.

        Over the years, the insurance industry has under performed its role in the financial sub sector of the economy when compared with its counterpart in order part of the world. Some of the factor responsible for this include low capitalization high receivable, poor public perception, and low investment in information technology amongst others. The growth of the insurance industry in Nigeria was also impeded factors responsible for these impeded growth includes poor national insurance culture and awareness, fraud and fraudulent claims, proliferation of companies, disunity and indiscipline in the industry, high production costs, perceived poor public image amongst others.

        The opinion of rebranding the insurance sub-sector of the economy and making it a mega player in the global financial market as a part of the vision 2020 goal brought about the insurance reform in Nigeria. The insurance reforms can e seen to be a statutory framework set and implemented by the Federal Government and Central Bank of Nigeria in the interest of the national economy and growth of the insurance industry. The reform process includes recapitalization of the insurance industry\, reconsolidation of the industry, agricultural insurance reform, oil and gas insurance reform, pension scheme reform, national health insurance scheme, issues in corporate governance, issues on statutory deposit.

        The reform process on the insurance industry generally was introduced in September 2005 when the federal. Government through the honourable miniter of finance, Dr (Mrs) Ngozi Okonjo Iweala announced the new minimum share capital for insurance and re-insurance business operating in the country. The minimum share capital is as follows; for life business 2 billion naira, for non-life business 3 billion naira for composite business 5 billion naira and for re-insurance business 10 billion naira.

        The objective of this reform is to increase the industry’s low retention capacity, attract foreign capital infusion into industry, and create a competitive environment etc. However, there are shortcomings and loopholes in the performance and outcome of the reform exercise carried out in the insurance industry.

        It is therefore against this background and also the aim of the researcher to critically examine the pre-post evaluation of the insurance reform in Nigeria.


        The Nigeria insurance industry has been an eyesore in the past year. Despite the various advantages and importance the industry has played in enhancing the development of the Nigeria Economy, there are lots of criticisms on the operations of the insurance industry in Nigeria these criticisms include inefficiency in claims handing procedure high cost of insurance products, inefficiency in insurance operations, etc.

        In other view, there are also other factors that impede the insurance business in Nigeria.

        They include poor national insurance culture, fraud and fraudulent claims, proliferation of companies, brokers, agent, disunity and indiscipline in the industry etc. All these factors put together has brought about or contributed to be downfall of the industry.

        In view of the above and in a quest to rebrand the financial sector of the economy, the federal government introduced the reform process in which insurance sub-sector is also inclusive. All looks bright for the industry. This is in view of the recapitalization which is aimed at positioning the insurance industry for new challenges in this ever dynamic world.

        However, there are accusations and counter accusations on the performance of the insurance industry after the reforms. While some believe it has enhanced the efficiency and productivity of the sector, other believe that the reform exercise has not been successful in attaining its objectives. It is based on the above that this work will be undertaken to examine the pre-post evaluation of the insurance reforms in Nigeria.

1.3   OBJECTIVE OF THE STUDY                                    

        The objective for which this research is conducted is

Ø  To find out the performance of the industry after the reforms

Ø  To find out the performance of the industry before the reforms

Ø  To find out the impact of the reforms on the industry

Ø  To find out the objectives of the insurance reofmrs.

Ø  To evaluate the effectiveness of the reform on the industry.


1.     To what extent has the objective of the reform been achieved?

2.     Has there been increase in the patronage of insurance product as a result of the reform?

3.     Is there any increase in the performance of the insurance industry as a result of the reform   


1)     There has not been a significant increase in the patronage of insurance products due to the reforms

2)     The insurance industry has not played any significant role in contributing to the GDP of the economy.


        This research would significantly help to know the areas in which the reform has made impact.

        This study would help to compare the performances of the insurance industry before and after the reform.

        It will also serve as an important source of information to students and others who may intend to research more on the topic.


        This study is designed to examine the pre-post evaluation of the insurance reforms in Nigeria the scope of this study would be limited to the insurance sector of the Nigeria economy.

        For analytical purposes and comparisons, the period for which the would cover will be 1999-2009.

        Dearth of materials like test books, journal and other publication on the subject matter will also the scope of the study of the researchers.


        This study is organization into five chapter as follow: chapter one, the introductory chapter embodies the background of the study, statement of the study, objective of the study, significance of the study, scope and limitation of the study,  research questions and research hypotheses.

        Chapter two, shows a review of the related literature. Here the expert opinion of our topic of study is reviewed. The sources of the literature include textbooks, journals, on-line document, and newspapers. It includes an overview of the insurance in Nigeria, the pre-reform stage of the industry, the reform Exercise in the insurance industry, the impact of the reform, and the post-reform era of the insurance industry.

        Chapter three, presents the design or methodology of the study, here, the null hypothesis is presented and the methods used in analyzing the data.

        Chapter four, presents analysis and interprets data collected to falls explain the findings.

Chapter five, the final chapter contains the summary, conclusions and recommendations of the study.