Insurance sector in sustained growth as Gross Premium Income grows by 18% YoY: Nigeria

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Data from the National Insurance Commission (NAICOM) has shown that the gross premium income of the insurance sector increased by 18 percent year-on-year (y/y) and 36 percent quarter-on-quarter (q/q) to N726 billion in fourth quarter (Q4) 2022.

The total premium income is made up of income generated from both the life insurance and non-life insurance businesses.

Analysts from FBNQuest observed that the insurance sector has remained resilient despite the several macroeconomic headwinds faced by the sector, such as high inflation, rising cost of energy and FX shortages.

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In line with recent trends, the non-life business continued its market dominance with a 57 percent share of the total premium income. In terms of value, the total premium income generated by the segment increased 17 percent y/y and 34 percent q/q to N417 billion.

The data shows that the oil and gas sector was the leading contributor to the non-life business with a share of 30 percent.

It was followed by fire insurance and motor insurance with respective shares of 22 percent and 15 percent. Marine and aviation, general accidents and others also contributed around 12 percent, 11 percent and 10 percent of the total premium income, respectively.

The life insurance business, which accounted for 43 percent of the total premium income generated by the sector, increased by N48 billion or (+18 percent y/y) to N309 billion in Q4 2022.

On a cumulative basis, the total premium income generated by the insurance sector increased by 16 percent y/y to N1.9 trillion in FY’22.

In terms of the sector’s market size, the data showed that its total assets stood at N2.3 trillion, implying an increase of two percent q/q and four percent y/y.

With respect to market size distribution of total assets, non-life business assets stood at N1.1 trillion, while life insurance assets amounted to N1.2 trillion.

Based on the data, the sector’s insurance claims rose by 31 percent q/q to N318 billion during the quarter, accounting for 44 percent of the total premium income.

Although the country’s insurance sector has continued to deliver double-digit growth, there is significant ground to cover with respect to providing insurance coverage to individuals, particularly those in the informal sector.