Micro-insurance as a Socio-Economic Tool for National Transformation: A Legal Perspective

Abstract

Micro-insurance is a financial strategy that recently evolved for the purpose of providing appropriate risk control mechanisms for persons involved in micro and small scale enterprises. In relation to national transformation, therefore, micro-insurance is a vital tool for the reduction of poverty and provision of equal economic opportunities for all citizens. Nevertheless, in Nigeria, there is lack of adequate literature that establishes the nexus between micro-insurance and national development. Although the National Insurance Commission (NAICOM) released the Guidelines for Micro-insurance Operation in Nigeria in 2013, it is uncertain whether the same is adequate in extracting the benefits of micro-insurance for national development. Consequently, this doctrinal study examines, from a legal perspective, the role of micro-insurance in national transformation. The paper demonstrates that micro-insurance not only serves as a catalyst for economic development, but also constitutes a novel social protection model for low-income persons. In order to strengthen the recent Guidelines in realizing the goals of micro-insurance for national transformation, this paper highlights some regulatory experience from South Africa and recommends the introduction of Financial Inclusion Regulatory Structure (FIRS) as a reform strategy for Nigerias policy reformers.