Insurance Sector Maintains Steady Growth, Up 65.1% in 5 years

James Emejo and Ebere Nwoji

The Commissioner for Insurance, Mr Sunday Olorunndare Thomas, has said that the insurance industry has in the past five years (2017-20022) maintained a steady growth in Gross Premium income (GPI) insisting that the future of the industry has remained bright.

Thomas, who spoke at the 2022 Seminar for insurance correspondents organised by the National Insurance commission (NAaICOM) in Lagos, noted that the future of Nigerian insurance industry was fast shifting its landscape for better.

According to him, looking at current developments in the industry, the sector’s landscape is shifted and is shifting.

He said the insurance sector in 2017 grew its gross premium income by 14 per cent, “and by 2018 the growth rate stood at14.5 per cent in 2019, it grew by 20.9 percent. In 2020, while other sectors of Nigerian economy contracted including the national GDP which growth contracted by -19 percent, insurance sector maintained a steady growth with its graphical curve showing V shape indicating that unlike other sectors of the economy which growth trajectory plummeted during the period, insurance sector maintained a steady growth despite the pandemic and its associated business lock down.”

“The gross premium income is the essential indicator of growth in the Insurance sector and in 2018 it posted a 14.5 percent growth to N426 billion of gross premium income fromN372billion posted in 2017. This is rather commendable in relation to the macroeconomic behaviour recorded during the period with growth of the economy being only 1.9 per cent, ”the commissioner stated.

Presenting the sector’s other growth figures within the five year period, Dr Umar Baba of Research and Statistics department of NAICOM, said in 2021, the sector’s growth rate rebound to 20 percent whereas in other African countries like Tanzania, growth rate was 12 percent , in Egypt, 18.5 percent and 7.0 percent in Malaysia 

He said in overall, the insurance sector within the five year period (2017-2022) showed 65.1 percent growth in GPI growth.

“In 2022, the GPI of the sector for the first quarter stood at N223.8 billion showing 6 percent YOY growth .In second quarter, the growth shifted to N 369.2 billion indicating 65 percent QOQ growth and about 20 percent YOY growth. Outpacing real economic growth of the entire country.”

Fire insurance, he said, recorded the highest growth of 32.5 percent with life insurance business recorded the highest growth rate of 24.5 percent in the first half of the year.

“In 2022, the insurance sector showed 20 percent YOY growth,59 percent QOQ growth, proving resilient in terms of premium generation, capacity to retain business which  signifies sound financial stability, and carriage capacities, “he added.

This, according to him, is in tandem with the GPI growth, which in 2017 stood at N265.5 billion to N441.2 billion over the period 2017 to 2021 showing 66.2 per cent.

He said retention experience in the first half of 2022 was not different from the previous year as life business stood at 93 percent, non life at 55 percent while the industry’s average stood at 71 percent