Nigeria’s insurance sector has achieved an average growth rate of 35.07 percent in both life and non-life classes of business in the past ten years.
The breakdown of the figure, published in the Nigerian Insurers Association’s (NIA) annual digest revealed that life business recorded a higher growth rate of 27.64 percent, while non-life grew by 7.43 percent in the last 10 years.
The latest publication of the digest, highlighted that life business witnessed the highest increase in premium of 85.8 percent in 2008, but recorded poor performance in 2016 when it recorded -0.50 percent increase in premium generation.
In 2011, life business premium grew by 37.21 percent followed by 2014, when premium from life business grew by 35.02 percent. In 2012, premium from life business grew by 28.25 percent while in 2017, it grew by 27.59 percent.
The insurance sector witnessed highest increase in premium in 2008 for the non-life segment, when the sector’s premium grew by 22.1 percent. An increase was also experienced in 2009, when the industry’s premium in non-life business grew by 19.6 percent and was closely followed by 2011 and 2012 when it increased by 11.80 percent and 11.63 percent respectively.
However, the sector recorded the worst performance in premium generation in 2015 and 2014 when growth stood at -3.50 percent and -1.31 percent respectively. In motor insurance business segment, another class of non-life insurance business, the sector recorded a net written premium of 33.859 billion naira.
Mr Eddie Efekoha, the immediate past Chairman of NIA and Managing Director Consolidated Hallmark Insurance, said the total quantum of businesses written by insurance companies grew from 315.96 billion naira in 2016, to an estimated 363 billion naira in 2017.
He noted that in 2017, insurance firms had to grapple with challenges of epileptic power supply and dilapidated infrastructure such as roads and other public facilities, all which exposed the industry to increased cost of operations. Efekoha said the challenges, “coupled with a suffocating tax regime impacted the bottom line of insurance companies”.
According to him, despite the challenges, the insurance industry, during the period under review continued to perform its role of financial intermediation and business restoration in line with its mandate.
Efekoha revealed that to ensure a more robust performance in the current business year, the industry operators in collaboration with the National Insurance commission (NAICOM) embarked on various initiatives to deepen insurance penetration.