Abstract
The study examined heterogeneous income sources and operating liquidity of insurance firms in Nigeria. Specifically, the study examined the effect of Gross Premium Income, Investment Income and Fees/ Commission Income on Liquidate Ratio of listed insurance firms in Nigeria. The study was based on a total of 104-year data observations obtained from eight (8) insurance firms listed on Nigeria Exchange Group during 2011-2023 periods. Panel Least Square Regression Analysis was used to test the three null hypotheses formulated for the study. Results indicate that the effect of Investment Income as well as Fees/ Commission Income on Liquidate Ratio of the insurance firms in Nigeria is positive and statistically significant while the effect of Gross Premium Income on Liquidity Ratio of the firms is positive, but statistically not significant. The study recommends that the insurance firm in Nigeria should intensify marketing effort to sale insurance policies and collect premium income on time to enhance operating liquidity. The firms should equally develop new insurance products in order to expand their premium income and boast their liquidity. The study also recommends that the firms should invest some of their surplus premium on shares of quoted firms to receive returns on the investment and boast operating liquidity. The firm should also improve their operating liquidity by rendering other professional services, such as guarantee, letter of credit.
Keywords: Heterogeneous, Income, Liquidity, Investment and Commission