The study investigated how insurance affects the growth of SMEs in Nigeria. It focused on employee liability insurance claims, accident insurance claims, and fire insurance claims. The study used Augmented Dickey-Fuller unit root tests, descriptive statistics, and autoregressive distributed lag (ARDL) modeling with E-View software to analyze a 22-year dataset (2000-2022) from the Central Bank of Nigeria (CBN) and NAICOM statistical journal. The findings showed that whereas accident insurance claims had a favorable impact on SME development (p-value of 0.04535 percent), fire insurance claims had a negative impact (p-value of 0.00005 percent). Additionally, claims made against employee liability insurance claims have a positive effect on SME development of 0.03015% (p-value). The key finding was that insurance has a large and positive impression on the development of Nigeria's small and medium-sized businesses. The study's findings led to the following recommendation: Insurance providers should give SMEs priority, and regulatory bodies must ensure timely claims payment, to allow efficient claim resolution and raise demand for insurance among Nigeria's growing small and medium firms. For SME managers and operators, seminars, workshops, and conferences on insurance claims procedures should be organized locally through partnerships between the insurance sector and SME groups like SMEDAN and MAN.