Page 1 of 18

Journal for Studies in Management and Planning

Available at

http://edupediapublications.org/journals/index.php/JSMaP/

ISSN: 2395-0463

Volume 04 Issue 03

March 2018

Available online: http://edupediapublications.org/journals/index.php/JSMaP/ P a g e | 134

Impact Of Life Assurance Business On The Growth Of Nigeria Economy

By

Agbaji Benjamin Chukwuma

Agbajiben@Gmail.Com

Department Of Insurance And Risk Management

Faculty Of Management Sciences Enugu State University Of Science And

Technology.(Esut)

&

Solomon David Pere

Tebewi045@Gmail.Com

Department Of Finance And Accountancy

Faculty Of Management Sciences, Niger Delta University

ABSTRACT

This research work examined the impact of life assurance business on the

growth of Nigeria economy. The study focused on the selected insurance

companies in Enugu metropolis. Descriptive research deign was used to carry

out this study. A sample size of 100 was derived from a total population of 150

staff using Taro Yamane sampling formula. Data analyzed in this study were

gotten from a well-structured questionnaire. And z-test statistical model was

utilized in testing then research hypothesis.Based on data analyzed, it was

discussed the life assurance business has a positive impact on the individuals

and the growth of Nigeria economy. Based on the analysis the following

recommendations were made: that there is need for insurancepractitioners to

periodically develop new products to meet the insurance needs of Nigeria

awareness campaign should be carried out about the benefits of life assurance,

genuine claims should be properly settled, competent workers should be

employed among other issues,

keywords: life assurance, insurance Business, insurance practitioner and

benefits of life assurance

INTRODUCTION

According to Nwite (2007), the

development of life assurance

business can be traced as far back as

1583. It was in this year that we

have the first evidences of life

assurance contract know today. A

policy was taken on 18th June 1583

on the life of WILLIAM GIBONS

for a sum of $38 2 the contract was

for twelve months and the Money

was to be paid if g Gibons died

Page 2 of 18

Journal for Studies in Management and Planning

Available at

http://edupediapublications.org/journals/index.php/JSMaP/

ISSN: 2395-0463

Volume 04 Issue 03

March 2018

Available online: http://edupediapublications.org/journals/index.php/JSMaP/ P a g e | 135

within the twelve months. He did

infact died on 8th May 1584. After a

slight dispute over whether twelve

moths meant twelve calendar

months, the money was paid.

The short-term form of policy taken

by William Gibson was the type of

life assurance policy issued in those

early days. The provision of life

assurance continued almost

unaltered for the next century with

the short-term policy mentioned

above, a form of mutual association

similar I design to the ancient burial

societies where members contribute

to a common fund out of which

payments were made on the death of

members (Nwite, 2007)

Olufawo (2005) states that,

“today, we have thousands of life

assurance polices issued in Nigerian

in form of whole life assurance

endowment assurance, term

assurance and joint life assurance.”

interestingly in advanced countries,

life assurance business has become

the greatest area of investment

because it even encourages savings.

According to Popoola (2011),

life assurance is a contract between

an insured and an insurer, Where the

insurer promises to pay a designated

beneficially a sum of money (the

benefit) upon the death of the

insured person. Depending on the

contract, other events such as

terminal illness or critical illness

may also trigger payment. The

policy holder typically pays a

premium either regularly or as a

lump. Sum other expenses (such as

funeral expenses) are also sometime

included in the benefits.

Page 3 of 18

Journal for Studies in Management and Planning

Available at

http://edupediapublications.org/journals/index.php/JSMaP/

ISSN: 2395-0463

Volume 04 Issue 03

March 2018

Available online: http://edupediapublications.org/journals/index.php/JSMaP/ P a g e | 136

The primary objective or aim

of life assurance is to provide

assurance guarantee (financial

protection) against the happening of

an insured event which could either

be death of the life assured or the

expiring of specified period. Life

assurance in the first instance

existed to pay the sum insured in the

event of policy holder’s death. This

is the basic theory of life assurance,

but the investment aspect of it has

tended to overshadow the primary

purposes of protection against

premature death (Nwite, 2007). In

Nigeria, pension business was

handled for many years by insurers

until a group sold the idea of a

contributory pension scheme to the

former scheme) were pensioners

could not got their pensions

(benefits) after queuing for day led

to the collapse of the old scheme

(Nwite, 2007).

The repeal of the old pension

Act of 1979 and consequent

amendment of the Nigeria social

assurance Trust Fund Act of 1993

brought in the new pension Reform

Act, 2004. Today, the pension fund

has grown tremendously and is in

excess of N1.6 Trillion, about 10

times the premium of N164.5 Billion

recorded in the assurance sector in

2008 (Fola, 2012). In the present

dispensation, the sector stands the

chance to get boosts from some of

the statutory polices set for

enforcement. They are employers

and annuity opened for voluntary

patronage by pensioners. The

Workmen’s compensation Decree of

1987provided cover for permanent

or partial disability, accident,