A marked increase in the uptake of life insurance policies has pushed the nation’s insurance industry’s gross premium to a record level of N217.75 billion in the 2011 financial year, as against N185.73 billion recorded during the same period in 2010, indicating a 17.24 percent growth.
Whereas life insurance companies contributed N54.6 billion, as against N39.76 billion in 2010, growing at an average growth rate of 25.61 percent in 2011, non life companies contributed N163.2 billion from N145. 97 billion in the previous year, at an average growth rate of 20.69 percent, investigations reveal.
A document accessed by BusinessDay shows that motor insurance from the non life category contributed the highest figure of N44.65 billion, out of which written premium stood at N42.67 billion. This is followed by oil and gas risks which contributed N34.12 billion and written premium, N11.72 billion.
While general accident generated gross premium income of N29.59 billion and written premium N24.46 billion, marine and aviation risks contributed N23.40 billion gross premium and written
premium N17.06 billion respectively. Workmen’s compensation generated N630.83 million, gross premium and miscellaneous N10.93 billion during the period under review.
Whereas fire insurance recorded a gross premium income of N19.86 billion, written premium recorded N13.59 billion during the period under review.
With this result for the 2011 financial year, Nigeria ranks fourth in Africa, contributing 0.03 percent share of the world’s insurance market, trailing behind Egypt, Moroco and South Africa, which contribute 0.04 percent, 0.06 percent and 1.14 percent to world market share respectively.
Analysts from Swiss Re Economic Research & Consulting, expect fast growing economies in Africa, including Nigeria, to witness appreciable increase in nominal premium in the near term.
According to industry analysts, the long term call on Nigeria’s insurance sector is ably supported by its obvious demographic advantages and Nigeria’s economic prospects, relative to other emerging markets.
Although a fast rising bottom population base provides significant headroom for premium expansion, the analysts say that decades of poor insurance uptake, exacerbated by widespread cultural aversion and the inefficiency of the micro economic parameters, had slowed down growth in the insurance sector.
It was however stated that if the various initiatives in the sector are sustained and strengthened, the insurance sector revenue will assume a positive dimension in the coming years.
The insurance industry is made of 61 insurance companies, comprising 32 non-life companies, 10 composite companies, 17 life companies and 2 reinsurance companies.