Abstract: This study probed into optimal production scale and specifically assesses the significance of entrepreneurial price on the business performance in the Nigerian insurance industry. The study makes use of Cobb-Douglas cost and profit functional models to investigate performance of randomly selected insurance firms. The outcome of this study suggests that a few insurance firms in Nigeria mostly do not pay claims, therefore, establishing possible reasons why there is apathy for insurance services among insuring public. Labour price is significant in this study,but shows an inverse relationship with business performance.