Political Economy of Insurance Regulation in Nigeria: Regulatory Capture, State Capacity, and Market Development

This dissertation examines the political economy of insurance regulation in Nigeria, analyzing the dynamics of regulatory capture, state institutional capacity, and their joint effects on insurance market development from 1987 to 2023. The political economy perspective on financial regulation draws attention to how regulatory agencies' mandates are shaped, constrained, and potentially distorted by political pressures, industry lobbying, bureaucratic interests, and governance quality. In Nigeria, NAICOM's regulatory trajectory, including episodic recapitalization drives, policy reversals, and enforcement inconsistencies, presents a compelling case study for political economy analysis. This study employs a mixed-methods historical institutional design combining archival analysis of NAICOM's regulatory decisions from its establishment through 2023, elite interviews with 45 current and former regulators, insurance executives, and policy officials, and panel data regression modeling the relationship between regulatory quality indicators and insurance market outcomes across 36 states. The study develops an Insurance Regulatory Political Economy Index (IRPEI) as an original measurement contribution. Qualitative findings are integrated through process tracing to identify causal mechanisms linking political economy dynamics to regulatory outcomes. Preliminary analysis anticipates documenting systematic patterns of capture in enforcement decisions and identifying state-level governance quality as the strongest predictor of sub-national insurance market performance. Keywords: Political Economy, Insurance Regulation, Regulatory Capture, Nigeria, State Capacity.