May12, 2023/FBNQuest

According to the most recent bulletin from the National Insurance Commission (NAICOM), the gross premium of the insurance sector increased significantly by 44% q/q to NGN532.7bn in Q3 ’22. On a y/y basis, gross premiums generated by the sector were up 15% y/y. The total premium income is comprised of income generated from both the life insurance and non-life insurance businesses. On a 9M ’22 basis, the total gross premium stands at NGN1.1trn, implying an increase of 15% y/y.

As expected, the non-life insurance segment maintained its market dominance with a 58% share of the total gross premium income. It also saw a growth of 10% y/y to NGN310.9bn in Q3 ’22.

In terms of contribution, oil and gas accounted for 31% of the non-life business. It was followed by fire insurance, and motor insurance with respective shares of 21% and 15%.

Marine & aviation, general accidents, and others had market shares of 12%, 11%, and 10% respectively.

Life insurance, which contributed 42% to the gross premium income, increased by 23% y/y to NGN221.8bn during the quarter.

The national accounts show that the insurance sector grew by 2.2% y/y in Q4 ’22, much lower than the 19.1% y/y in the previous quarter and 12.9% y/y in the year-earlier. It also accounted for 10% of the financial and insurance sector GDP in 2022.  

With respect to market size, the industry’s total assets increased to NGN2.3trn as at 9M ’22, from NGN2.1trn in the corresponding period of the previous year, with NGN1.1trn in non-life business assets, and NGN1.2trn in life business assets.  

Also, the sector’s gross claims declined by -2% y//y to NGN242.bn, representing 46% of gross premium income in Q4 ’22.

Despite severe macroeconomic headwinds, the insurance industry has continued to improve premium generation and market size.