Impact of Economic Volatility on Policyholders Attitude towards Purchase of Insurance Policies in Plateau State

The assessment of policyholders’ attitude towards the purchase of insurance policies during economic volatility is one of the major objectives of insurance industry in Nigeria. The fear of perceived economic downturns shapes consumer preferences regarding different types of insurance policies which results to decline in insurance policy purchases, loss of trust, dissatisfaction, policy cancellations or adjustments in coverage and low policy renewal rates among policyholders. Considering the consumer risk behaviours policyholders display during inflationary periods or financial inclusion in fragile economic settings, this study examines the impact of economic volatility on policyholders' attitude towards the purchase of insurance policies in Plateau State. A descriptive survey design was employed, using both primary and secondary data sources. Data from 200 respondents were analyzed using descriptive and inferential statistics, including multiple regression analysis. Findings from the study revealed that income instability, inflation and unstable exchange rate were found to significantly reduce policyholders’ willingness to renew or purchase new policies in Plateau State. The study recommends that insurance firms in Plateau State should adopt inflation-indexed insurance policies to safeguard policyholders from the challenges pose by economic volatility towards the purchase of insurance policies.