Leadway, AIICO and Custodian and Allied top 10 insurance firms

Lead Assurance Limited, Aiico Insurance Plc and Custodian and Allied have the largest gross premium income and total assets. They both operate in the Life and Non-Life Business.

The ranking is based on the 2017 audited financial statement of 25 firms as gleaned from the website of National Insurance Commission (NAICOM).

Out of the 23 companies tracked by BusinessDay, Leadway emerged as number one with the largest gross premium income of N84.46 billion and a total asset of 283.37 billion while profit after tax stood at N13.83 billion.

 

Aiico Insurance Plc recorded gross premium income of N21.29 billion and N92.413 billion in total assets while net income stood at N1.28 billion.

Custodian and Allied Insurance Plc has gross premium income of N32 billion and total assets of N80.90 billion while net income stood at N7.31 billion.

AXA Mansard Insurance Plc recorded premium income of N26.19 billion and N66.56 billion in total assets while net income stood at N2.67 billion.

FBN Insurance Plc recorded N22.74 billion in gross premium incomes and N50.34 billion in total asset while net income stood at N3.67 billion.

Mutual benefit Assurance Plc recorded gross premium income of N13.35 billion and has N57.69 billion in total assets while the insurer realized 1.33 billion in net income.

 

NEM Insurance realized N13.03 billion in gross premium incomes and N17.56 billion in total assets while net income stood at N2.77 billion.

Royal Exchange Plc recorded gross premium income of N12.82 billion as it recorded a loss of N682.12 million while total asset stood at N33.27 billion.

Zenith Bank Assurance Limited recorded gross premium income of N12.80 billion as it recorded N37.02 billion in total asset while net income stood at N3.63 billion.

 

Insurers in Africa’s largest economy are operating in a tough and unpredictable macroeconomic environment as penetration rate is one of the lowest in the world.

 

Despite the country population of 200 million, insurance penetration is 0.30 percent- one of the lowest figures in the world-, this compares with South Africa (14.7%), Kenya (2.8%), Angola (0.8%) and Egypt (0.6%).

 

Similarly, the sector’s insurance density (a measure of industry gross premium per capita) is still one of the lowest when compared to peers – South Africa (US$762.5), Egypt (US$22.8), Kenya (US$40.5) Angola (US$30.5) and Nigeria (US$6.2).

 

 

 

The National Insurance Commission (NAICOM) is unable to formulate policies that will unlock the opportunities in industry.

 

 

For instance, the regulator capitulated to the tumultuous uproar by operators under the aegis of Independent Shareholders Association of Nigeria (ISAN) as it jettisoned the three tier recapitalization. The aim of the policy was to ensure that insurers undertake risk commensurate with their capital bases. 

 

Foreign companies have insisted that only firms with capital base not less than $9 billion can underwrite their risks.

 

Leadway Assurance Limited, the largest insurer by revenue and asset, has a shareholders’ fund of N55.03 billion as at December 2017, this compares with N1.02 trillion total equity of tier 2 lender Sterling Bank as lenders are liquid enough to take advantage of a high yield environment.

 

Similarly, AXA Mansard, the most capitalized insurance firm in the country, has a market capitalization of N19.3 billion, this compares with N59.39 billion market cap of Tier two lenders- Fidelity Bank.

 

Ekerete Ola Gam-Ikon a Consultant on insurance matters noted that weak corporate governance was significantly evident in 2018 despite efforts by NAICOM to improve governance discipline by operators. 

 

Of course insurers are operating in an environment where the vast majority are illiterate, while religious beliefs have hindered many from taking up a cover. In some part of the country, taking a Life cover is taboo because people see the policy as a premonition of their own death.

 

The National Commission for Mass Literacy, Adult and Non-Formal Education, about 70 million citizens of Nigeria who cannot read and write or who lack basic skills for modern living.