Effect of Financial Deepening on Insurance Penetration in Nigeria, 1986 -2018

This study examined the effect of financial deepening on insurance penetration in Nigeria, using annual time series data from 1986 to 2018. The study adopted ex-post facto research design. Broad money supply and credit to private sector were used as proxies for financial deepening. Data for the study were first subjected to stationarity test using Phillips-Perrons statistical method and Johansen co-integration test. Ordinary least square (OLS) statistical method was used for data analysis. The results from the tests of hypotheses show that: broad money supply and credit to private sector as a ratio of Gross Domestic Product have positive but non significant effect on insurance penetration in Nigeria. The study concludes that broad money supply and credit to private sector as a ratio of Gross Domestic Product had not exerted significant effect on insurance penetration in Nigeria between 1986 to 2018. The study recommends that: There is need to increase the amount of credit facilities given to private sector (CPS) in the country in order to deepen insurance penetration in Nigeria. Thus, all unnecessary stringent measures inhibiting public sector access to credit facilities should be addressed to make funds available to genuine investors/borrowers.