Abstract
Research Purpose: This study examined the effect of exchange rate volatility on the growth of general insurance business in Nigeria from 1997 to 2022. The specific objectives of the study were to measure the effect of real effective exchange rate on fire insurance premium income and to determine effect of real effective exchange rate on motor insurance premium income in Nigeria.
Methodology: The ex-post facto research design was applied. Data was taken from CBN Bulletin 2022 and NAICOM reports of various years. Hypotheses formulated were analyzed using Ordinary Least Squares (OLS) and regression analysis.
Findings: It was found that real effective exchange rate positively but non-significantly impacted on fire insurance premium income in Nigeria within the period of the study. Also, it was revealed that real effective exchange rate positively and non-significantly impacted on motor insurance premium income in Nigeria within the period of the study.
Conclusion: Based on the findings of the study it was concluded exchange rate plays a positive impact on insurance income in Nigeria as used in the context of this study. In line with the findings it was recommended that an expanded exchange rate regime that does not embrace parallel exchange rate will go a long way in making insurance have more premium income and finally contribute to economic growth.
Recommendation: Management of exchange rate regime by the government through exchange rate fixation will go a long way in making insurance have more premium income and finally contribute to economic growth.
Key words: Economic growth, Exchange rate, Exchange rate volatility.
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