Insurance Sector Grows Assets to N2.33trn, Premium Hits N726.2bn
Ebere Nwoji
The National Insurance Commission (NAICOM), has announced that the insurance sector ‘s total assets grew to N2.33 trillion in the fourth quarter of 2022.
In a report on the sector’ performance in the last quarter 2022, NAICOM said the sector generated a total premium of N726.2 billion.
This represents 36.3 per cent growth quarter-on-quarter (QoQ) and 17.8 per cent year-on-year (YoY) in gross premium income
According to the report, the assets figure represents positive growth that signifies expansion at the rate of 2.4 per cent, QoQ and at 4.4 per cent YoY in the sector’s assets.
The report said the market size distribution in terms of the total assets of the sector stood at N1.22 trillion, while the non-life insurance businesses during the period stood at N1.12 trillion.
It also said the Non-Life business as in the prior periods, continued its dominance, contributing about 57.4 per cent relative to the share of the Life business 42.6 per cent keeping about same position in prior period.
According to NAICOM, “The proportional significance of Life in the industry sustained a positive course in recent times reflective of the consumer’s confidence and awareness. In-depth analysis of the Non-Life segment of market shows Oil & Gas business sustaining its market share dominance at 30.25 per cent increasing by 2.4 per cent compared to the previous quarter. The figure posted by Fire Insurance came a distant second (22.2 percent) maintaining same pattern of contribution to the gross premium pool of the market while Motor Insurance (14.9 per cent) Marine & Aviation (12.2 per cent) General Accident (11.1 per cent) and Miscellaneous (9.5 per cent) followed in that order.”
On the other hand, the NAICOM report said Life business was driven by Individual Life portfolio (38.6 percent) even as its relative contribution fell by about (2.6 percent) compared to third quarter (41.6 per cent).
According to the report, in a contrasting path to the previous quarter, group life followed by 34.5 per cent while Annuity business contributed gross premium income of 26.9 per cent during the period.
The commission therefore said in the phase of operational challenges posed in domestic and global economies, the industry has continued to post inspiring numbers in business retention, reflective of the market resilience and increasing capacity.
According to the commission, in the period under review, industry wide average retention ratio stood at 71.3 per cent although, slightly a point lower than it held in the previous quarter and four points lower in comparison to same period YoY.
It said the life business segment Persistently retained about the same point of 93.3 per cent from its prior position of 93.8 per cent in quarter three.
It said the Non-Life segment, which also took a similar pattern, had Motor Insurance continuing its lead as the highest retaining portfolio with a retention ratio of about ninety-four per cent (93.5 percent also a point higher than its standing in the prior quarter.
The report said Oil & Gas recorded the least at about thirty- six per cent (35.9 percent) adding that this has lamentably remained a challenging angle in the market owing to its nature of enormous capital and professional requirements.
“Consequently, the retention performance in the current period sustained its prior position when compared to the third quarter as evidenced by the overall Non-Life business ratio of 55.0 per cent, slipping from 56.6 per cent held in the prior period.
It added, “Claims reported during the fourth quarter stood at N318.2 billion representing 31.2 per cent QoQ growth. In a similar pattern, the net claims paid were reported at N244.3billion, growing at 17.9 per cent QoQ during the same period.
“Insights into the Non-life segment showed that Motor Insurance led with regards to claims settlement vis a vis gross claims reported at about 92.3 per cent per cent signifying a nine points improvement as against its prior position.
“Fire Insurance was the least at about forty-six per cent (46.3 per cent) the only class below average proportion. All other portfolios of General Accident Insurance (80.7 per cent) Oil & Gas (51.6 per cent) Marine & Aviation (74.4 per cent) miscellaneous Insurances (86.1 per cent) recorded a proportion above the average, of paid claims against gross claims reported, “it said.
