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ABSTRACT
For insurance company to adequately develop and contribute effectively to economic development there is need for efficient flow of information among parties to insurance transaction. Insurance contribute significantly by providing certainty at the uncertainty of loss, it also help in loss through it compensation system. This study tests for information asymmetry problems in health insurance in Nigeria. The study focused on Benin in Nigeria. To this end we distributed well-designed and structured questionnaires to participants in the scheme. Test statistics technique was adopted and it was discovered that there is significant proof of the existence of moral hazard in insurance company in Nigeria’s and that adverse selection also significantly plagues insurance company in Nigeria. We recommend that to avoid this information asymmetry in insurance in Nigeria, there is need for efficient flow of information between the participants in the scheme and the regulators of the scheme. Absence of the flow of correct and detailed information between the policyholders and insurance company will defeat the purpose of establishing the scheme.
