Mataracy
VIP Contributor
I will use Nigeria Insurance as a case study.
Insurance and reinsurance, from the pon of view of government control, are federal subject, although some state governments have their own insurance companies, by the ( National Insurance Commission) Federal Ministry of Finance.
As in any other economy, the role of the Nigerian government in the economic system is very extensive. Over the years the nation has evolved an economic system in which both private and state enterprises co-exist.
In the Nigerian scene amongst the reasons for government participation in insurance business ( as an insurer) could be mentioned; leadership role ; the desire to provide cover for risk for which private insurers lack the enthusiasm or expertise to venture into; control and state security; manpower development; provision of social security like health insurance, sickness/ accident insurance; local capacity utilization; conversation of foreign exchange; revenue drive, etc.
In recent times however, it could be said that the major reason for government's active involvement in insurance business is purely for revenue drive or profit motive. Insurance has become a profit earning business despite the enormous (big) risks associated with it.
Governments in developing economies do not often resist the temptation to join this quest for profit. In a federation like Nigeria, this is certainly so of the various state-owned companies established with guaranteed government patronage.
Insurance and reinsurance, from the pon of view of government control, are federal subject, although some state governments have their own insurance companies, by the ( National Insurance Commission) Federal Ministry of Finance.
As in any other economy, the role of the Nigerian government in the economic system is very extensive. Over the years the nation has evolved an economic system in which both private and state enterprises co-exist.
In the Nigerian scene amongst the reasons for government participation in insurance business ( as an insurer) could be mentioned; leadership role ; the desire to provide cover for risk for which private insurers lack the enthusiasm or expertise to venture into; control and state security; manpower development; provision of social security like health insurance, sickness/ accident insurance; local capacity utilization; conversation of foreign exchange; revenue drive, etc.
In recent times however, it could be said that the major reason for government's active involvement in insurance business is purely for revenue drive or profit motive. Insurance has become a profit earning business despite the enormous (big) risks associated with it.
Governments in developing economies do not often resist the temptation to join this quest for profit. In a federation like Nigeria, this is certainly so of the various state-owned companies established with guaranteed government patronage.