Adopting Micro Insurance Models in Providing Pension Benefits to Nigerian Rural Dwellers

Abstract

Employees are faced with unpredictable retirement life, and therefore dream of guaranteed income inflow during retirement. Acquisition of shares and buildings for commercial purposes seems to be the easy antidote to this challenge, until the introduction of the Contributory Pension Scheme in 2004 by the Nigerian government. The scheme legally guarantees 50% lump payment upon retirement and the spreading of the payment of the remaining 50% of the total retirement benefit on regular basis throughout the life span of the retiree. The latter 50% could be used to buy savings account or annuity contract. However, most retirees are faced with the problem of irregularly paid incomes, which usually are very low. This paper x-rays the expected impact of micro insurance scheme on providing retirement benefits to the rural dwellers.
It was found that Micro Insurance Scheme will help to provide retirement benefits through collection and invest of savings made payable to the rural dwellers on retirement. Therefore, it was concluded that micro insurance scheme is the preferred way of providing pension benefits to the rural dwellers upon retirement. Hence, we recommend that Nigerian governments should encourage micro insurance pension for rural dwellers, mostly the artisans, through effective enlightenment measures.