Analysis of Factors that Enhance Insurance Penetration in Rural Areas in Imo State Nigeria

Abstract

This study examined the factors that enhance the insurance Penetration Rates in rural areas of Nigeria. Enhancing insurance penetration has been the target of the insurance regulatory body and ascertaining the factors that propel insurance penetration is one way of achieving this objective. This study set out to identify the factors by sampling two rural areas from Owerri, Orlu and Okigwi. Specifically, 180 respondents spread proportionately to the rural areas in Owerri, Orlu, and Okugwe zone were sampled. Their opinions and responses were coded using the Likert scale and subjected to statistical analysis of the Pearson correlation coefficient and t-test of significance. We found that prompt claims settlement, increased level of awareness and knowledge about insurance, government regulations, and economic conditions have a high relationship and significantly enhance insurance penetration in rural areas of Nigeria. The conclusion was that the government through the National Insurance Commission should enact laws that will make every class of insurance compulsory and make claims settlement a top priority for the insurance industry in Nigeria.