Chief Executive of the Nigeria Solidarity Support Fund, Fejiro Chinye-Nwoko, has stressed the urgent need to strengthen health insurance coverage in Nigeria, warning that gaps in protection for the informal sector pose a major risk to economic stability and national productivity.
Speaking during an interview with ARISE NEWS on Thursday, Chinye-Nwoko highlighted that the informal sector accounts for more than 80% of employment in Nigeria and contributes up to 40% of the country’s GDP, making it central to economic survival and growth.
“So it is very important that this group of people are active in business. And if we leave this informal sector out of business, then we are significantly affecting our GDP,” she said.
She explained that workers in the informal sector are particularly vulnerable because they rely on daily income with little or no savings, meaning any health-related shock can quickly destabilise their livelihoods and businesses.
According to her, even minor illnesses can impose heavy financial burdens on low income earners, forcing them to spend far beyond their daily earnings and sometimes depleting their business capital.
“For example, a petty trader who earns about maybe 10,000 a day, for average primary health illness, can be spending up to 50,000 to 100,000,” she noted, adding that hospital admissions and surgeries could cost significantly more.
She warned that such financial shocks often lead to temporary or permanent business shutdowns, describing the link between health and economic survival in the informal sector as “significant and often underestimated.”
On healthcare financing, Chinye-Nwoko noted that about 70% of health expenditure in Nigeria is out of pocket, while less than 5% of the population is covered by health insurance.
She argued that this exposes millions of Nigerians to financial hardship, as health emergencies are largely unpredictable and force households to divert funds meant for business or daily living.
“If there is a need for health and they have to spend out of pocket, it’s going to lead to impoverishment,” she said, adding that productivity losses at scale have wider implications for GDP and inflation.
Chinye-Nwoko further revealed that research shows health shocks can reduce productivity and business continuity by up to 80%, particularly in developing economies like Nigeria.
She explained that disruptions in the informal sector also affect supply chains across the formal economy, increasing costs of goods and contributing to inflationary pressure.
On the low uptake of health insurance, she identified three key challenges: poor awareness, lack of trust in the system, and inflexible payment structures that do not accommodate irregular incomes.
“People really don’t understand how health insurance works , something you don’t clearly understand, you can’t buy into,” she said.
She emphasised the need for stronger public education on pooled healthcare financing, noting that many Nigerians misunderstand how insurance systems operate.
Chinye-Nwoko also called for more flexible payment models tailored to informal sector workers, alongside improved service delivery to rebuild trust in health insurance schemes.
On policy direction, she highlighted the role of government in enforcing mandatory health insurance under existing national frameworks, stressing that implementation remains the key challenge.
She also urged private sector operators to innovate in payment systems and benefit packages, while calling on NGOs to intensify advocacy and community sensitisation.
“We need to tie mandatory health insurance to something every Nigerian holds valuable,” she said, pointing to the need for stronger enforcement mechanisms and broader public engagement.
Chinye-Nwoko concluded that only coordinated action between government, private sector, and civil society can close Nigeria’s health insurance gap and secure long-term economic resilience.
Goodness Anunobi
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