INSURANCE BUSINESS AND ITS IMPACT ON THE GROWTH OF THE NIGERIAN ECONOMY
Need help with a related project topic or New topic? Send Us Your Topic
DOWNLOAD THE COMPLETE PROJECT MATERIAL
INSURANCE BUSINESS AND ITS IMPACT ON THE GROWTH OF THE NIGERIAN ECONOMY
Chapter one
INTRODUCTION
THE LEADING ASSURANCE COMPANY (NIG) LTD
Leading assurance did not progress with 1970. The led way firm was formed in 1970 to put out full assurance business in Nigeria. The firm registration office is in Kaduna.
The headquarters of lead way assurance is located in Kaduna, Kaduna State. They have branches, which are known as ‘collecting centres’. These collecting centres are situated in almost every state of the federation.
Some of them are found in the following towns, Abuja, Akure (Ondo State), Bauchi (Bauchi state), Ibadan (Oyo state), Port Harcourt (River state) Sokoto (Sokoto state), Zaria (Kaduna state), Warri, Yola (Adamawa state), Gboko (Benue state), Jos (Plateau state), Kano (Kano state), Ikeja (Lagos state), Makurdi (Benue state) and Maiduguri (Borno state).
In these companies the following forms of the insurance business are: fire policies, motor vehicle business policies, accident policies, workmen compensation and life assurance policies.
BACKGROUND OF STUDY
Before the 19th century, there was nothing existent like Insurance business, nevertheless there were some organisations or communities who were established in the form of material, social insurance schemes which had the common feature of today’s contemporary insurance.
Among such were the age grade associations, extended family system and the cultural unions. These unions and groups maintained monies collected periodically from members out of which financial support were granted to decease members of the family who has encounter any tragedy.
Even now, in Nigeria, this form of social insurance remains a part of the cultural life of many communities. Furthermore, there has been the establishment of social clubs in Nigeria
such as the Kook Kats Club, which give some type of social insurance to their members while also using a portion of the accrued premiums for national development and charity donations.
The Royal Exchange Assurance Company Ltd was the first to establish modern insurance in Nigeria in 1921, and it remained the country’s exclusive insurance provider. Until 1949, three other British-owned insurance businesses were created. Prior to 1921, however, some type of insurance business existed in Nigeria, primarily in the marine (for export produce) sector, with a few in the motor insurance industry.
One may understand why this is the case because by 1920, data showed that Nigeria had approximately 300 vehicles and 17 miles of asphalt roads, therefore the chances of being hit by a motor vehicle were quite low.
By the time Nigeria obtained her Independence in 1960, the number of Insurance companies operating in Nigeria had climbed to 25. They were all mostly foreign-owned.
However, by 1984, there were 88 insurance companies operating in Nigeria most of which are now indigenous companies. In addition to that there were no registered insurance agents.
Available statistical indicates that the insurance market in Nigeria has developed substantially since 1960, not only in numerical strength but also in assets. By 1983, the insurance business in Nigeria attracted a gross premium income of N634 million.
The federal government promulgated the first insurance act in Nigeria in 1961, called as “the Insurance Companies Act 1961”. For the first time, the act requires insurance businesses to register or be licenced. At the same time, the Marine Insurance Act of 1961 was enacted, and it continues to control operations in Nigeria.
There were later registrations, the most notable being the Nigeria Insurance Decree 1976, which was enacted to regulate the insurance industry in a way that prior legislation did not.
The federal ministry of finance and the office of the director of insurance jointly control insurance businesses in Nigeria and the insurance industry.
The insurance department of this ministry is in charge of monitoring the activities of insurance companies to guarantee compliance with the provisions of the Nigeria Insurance Decree 1996 and other applicable regulations governing the insurance industry in Nigeria.
The National Corporation of Nigeria, which was founded by Decree No. 22 of 1969 to do insurance business in Nigeria, oversees some of the country’s main insurance businesses.
STATEMENT OF PROBLEMS
The insurance industry in Nigeria, in particular, provides a variety of safeguards against many of the dangers to which the economy is subject. Insurance firms contribute significantly to the country’s economic development. Notable among them are:
Safeguarding the incalculable hazards to which money is exposed,
Reducing the risk of loss for the entrepreneur or investors.
As much as the insurance industry promotes economic progress, many individuals are still unaware of its importance. Many people continue to voice discontent with the operations or services provided by the nation’s insurance companies, either implicitly or explicitly.
The worst part is that certain members of the public regard insurance companies as registered cheats since they provide you time and when it expires, the contract terminates without the insurer benefiting from the money he or she insured, and the company now owns the insurer.
1.3 PURPOSE OF STUDY
This research term will provide or require you to have a thorough awareness of the fundamentals of the insurance business, insurance concepts, and practice in the country.
This technique would allow banking and finance students to have a better understanding of the relationship between insurance and economic development.
The research material would not only provide more information to the user, but would also underline the contractual link between insurance firms and their clients.
This work would go on to serve as a foundation for any individual or group of people interested in conducting additional research in this area of study.
The guidebook will also be relevant to all students seeking the National Diploma in Banking and Finance.
1.4 Research Questions
The research questions that will guide the project are as follows:
What is the importance of insurance in national development?
How is insurance enhancing the standard of living in Nigeria?
What is insurance and assurance, and what are the classifications of insurance?
How does the insurance company facilitate economic growth?
1.5 The Scope of the Study
There have been various forces working against the acquisition of data for this project. However, the researchers must use their best knowledge and talents to collect the data and verify its accuracy. However, as previously said, several variables inhibited data collection, with financial being at the top of the list.
The researcher lacked the necessary financial resources to complete the job properly. Financial strength, which would have allowed for easy movement for data reconnaissance, was not present.
Time was another obstacle that prevented the researcher from conducting additional investigation. Because the project deadline was so short, the majority of the research was completed halfway.
Another difficulty was the end-of-course exam. The researchers were unable to continue their job because their examination was coming, and the scenario obliged them to swiftly complete the work in an unexpected manner.
However, the researchers worked hard to improve the work. Another area of concern was respondents’ negative attitudes towards providing information; the majority of respondents did not feel confident enough to express their thoughts to researchers.
Scope by Sample Only one insurance business in the country was chosen for investigation. The insurance company being evaluated is the Lead Way Assurance Scope Nigeria. As a result, all findings are written within the scope of the firm. Perhaps what is available in the company will not be found in other insurance companies in Nigeria.
1.6 Operation Definition of Terms
Insurance is an agreement with a corporation in which you pay them on a monthly basis and they commit to reimburse the cost of the loss, such as a fire disaster.
Assurance: A assertion that something will absolutely be true or will undoubtedly occur, especially when there has been doubt about it, such as death.
Policy: A plan of action agreed upon or adopted by an organisation, often known as a legal document that provides information of the insurance contract by clause and is obligatory on both parties concerned.
Indemnity entails restoring someone to his or her formal standing.
Insurer: The person or company that provides the insurance contract.
Premium is the amount of money paid to the insurance company.
A slip: An acceptance of the proposal that binds the insurance firm to offer a policy to the insured.
Cover note: The paperwork typically provides the insured with temporary protection for thirty days.
The proposal: it is a cause to obtain insurance coverage.
Subrogation: This is the insurance company’s right to stand in the place of the insured against those parties who caused the claim to be paid.
Utmost good faith: This means that all parties to the contract must act faithfully and honestly. Both the insurer and the insured must reveal all relevant facts to the contract.
Insurance interest: This phrase indicates that the insured must have an interest in the subject matter of the policy purchased.
Proximate cause: This means there must be a tight relationship between the risks insured and the cause of the loss.
Need help with a related project topic or New topic? Send Us Your Topic