Resumen
Insurance company?s performance can be stymied by internal and external risks. Industry reports show 23 companies out of the 55 operating companies (about 42%) in Nigeria recorded net operating losses in 2015. Macroeconomic risks are external and may be quite significant in providing an (un)favourable environment for performance of the industry particularly in a developing economy like Nigeria. Reflecting on the contribution of insurance to the Nigerian economy which shows an abysmally low penetration, averaging below one percent of GDP when compared to African peers such as South Africa at 13% and Kenya above two percent; it is of essence to investigate how these risks affect its performance which by implication could adversely affect insurance penetration. Dynamic least square regression technique was employed to study the dynamics of macroeconomic risks (GDP, inflation rate, and interest rate) on underwriting performance over the period 1981-2015. Weighed against theoretical underpinnings and other studies particularly in western economies, the study has evidence that interest and inflation rate shock adversely underwriting performance. Also, real GDP does not have positive shock on premium growth and loss ratio. Monetary policy should address inflation, and interest rates if the underwriting performance shocks in the non-life sector are to be mitigated in Nigeria. In the long term, government should focus on how to improve income per capita and reduce income inequality and dependency ratio so as to connect insurance consumption to real GDP growth.