Increased consumer confidence and uptake of personal life insurance policies for the protection of assets and dependents are driving premium growth in the Nigerian insurance industry.
The National Insurance Commission (NAICOM), in its Bulletin of the Insurance Market Performance, said the industry’s gross premium rose 14.9 percent to N532.7 billion year-on-year in the third quarter, while total assets stood at N3.2 trillion in the same period.
According to the commission, though the operating environment remains challenging due to global and domestic economic challenges, consumer confidence in the insurance industry remained high as affirmed by the relevant retention situation.
“Life business retention for the period was 94 percent, while non-life recorded a ratio of 55 percent as industry average stood at 71.4 percent,” it said.
In terms of share of the market volume, the non-life segment sustained its market dominance at 58.4 percent of the total premium generated.
Insights in the segment show oil and gas was the leading driver at 30.8 percent, followed by fire insurance (21.3 percent).
Motor insurance accounted for 14.6 percent, while marine and aviation, general accident and miscellaneous had 11.8 percent, 11.2 percent and 10.3 percent respectively.
Life business recorded 41.6 percent of the market production as its share contribution gradually closed up. The share of annuity in the life insurance business was about 25.5 percent, while individual life was at 41.2 percent of the premium generated during the period.
Read also: Insurers mull environment in product offerings, payouts
According to the commission, the insurance claims component defines the essence of insurance business as a whole and indeed a major factor in consumer confidence building.
The NAICOM data show that claims of N242.6b billion were paid out in the third quarter, 2.3 percent lower compared to the corresponding period of 2021.
The insurance market remained profitable during the period, recording an overall industry average 54.5 per cent, compared to 46.7 percent in the corresponding period of 2021.
“The market statistics of the third quarter 2022 has revealed some quality developments in the industry performance indicators in terms of growth, retention, claims management experience and profitability, at levels of which the industry could be ruled as profitable, sound and stable. In cognisance also to the ongoing digitisation and market deepening measures of the commission, the outlook remains strongly positive,” the commission said.
