BackgroundGlobally, the possession of medicines stored at home is increasing. However, little is known about the determinants of possessing medicines, their usage according to clinical purpose, which we term ‘correct drug match’, and the role of health insurance.MethodsThis study uses data from a 2013 survey evaluating a health insurance program in Kwara State, Nigeria, which upgraded health facilities and subsidized insurance premiums. The final dataset includes 1,090 households and 4,641 individuals. Multilevel mixed-effects logistic regressions were conducted at both the individual level and at the level of the medicines kept in respondents’ homes to understand the determinants of medicine possession and correct drug match, respectively, and to investigate the effect of health insurance on both.ResultsA total of 9,266 medicines were classified with 61.2% correct match according to self-reported use, 11.9% incorrect match and 26.9% indeterminate. Most medicines (73.0%) were obtained from patent proprietary medicine vendors (PPMVs). At 36.6%, analgesics were the most common medicine held at home, while anti-malarial use had the highest correct match at 96.1%. Antihistamines, vitamins and minerals, expectorants, and antibiotics were most likely to have an incorrect match at respectively 35.8%, 33.6%, 31.9%, and 26.6%. Medicines were less likely to have a correct match when found with the uneducated and obtained from public facilities. Enrolment in the insurance program increased correct matches for specific medicines, notably antihypertensives and antibiotics (odds ratio: 25.15 and 3.60, respectively).ConclusionSince PPMVs serve as both the most popular and better channel compared to the public sector to obtain medicines, we recommend that policymakers strengthen their focus on these vendors to educate communities on medicine types and their correct use. Health insurance programs that provide affordable access to improved-quality health facilities represent another important avenue for reducing the burden of incorrect drug use. This appears increasingly important in view of the global rise in antimicrobial resistance.