ABSTRACT
In Nigeria, for example, life insurance companies must invest a minimum of 25 per cent in Nigerian government securities, and this normally takes the form of investments in development stocks and other securities specified under the Government and Other Securities Act and the Trustees Investment Act 1962. Normally a capital market provides insurance companies with viable outlets for their investable funds. In Nigeria the role of the stock exchange and other capital-market institutions in providing suitable investment outlets for insurance funds has not been very satisfactory. Equity-linked plans which provide some hedge against inflation cannot yet be introduced by insurance companies because of lack of spread of the available securities in capital market. With the growth of the Nigerian economy, the insurance companies premium pool continues to grow in consonance with the overall growth of the economy. When the amount of investments made so far by these insurance companies is considered, their impact as financial intermediaries in Nigeria is appreciated.
