Nigeria’s insurance industry has reported a significant growth of 72% in gross premium income for the second quarter of 2024 (Q2’24), reaching ₦813.1 billion, compared to ₦470.7 billion in the first quarter of 2024 (Q1’24). According to analysts at FBNQuest, this robust growth underscores the sector’s resilience amidst the current challenging macroeconomic environment.
The latest data from the National Insurance Commission (NAICOM) reveals that the insurance sector’s gross premium income increased by 72% on a quarter-on-quarter basis and by 47.4% year-on-year compared to Q2 2023. This performance highlights the sector’s ability to navigate difficult economic conditions, demonstrating continued growth and stability.
In terms of profitability, the insurance market remained positive in Q2’24, with the sector recording an average net loss ratio of 55.5%, up from 52.9% in Q1’24. The non-life segment had a net loss ratio of 57.2%, while the life segment showed improvement, with a net loss ratio of 53.6%.
FBNQuest analysts pointed out that while the overall net loss ratio reflects market averages, some insurers faced greater challenges. Despite this, the sector as a whole remained profitable.
The report also indicated that Group Life insurance was the largest premium-generating component in the life insurance segment, accounting for 35.8% of gross premiums. In contrast, the annuity business contributed the least at 29.7% of the total.
In the non-life insurance sector, the Oil & Gas industry continued to dominate, contributing 39.2% of the segment’s share. Fire, Motor Insurance, and Marine & Aviation followed, contributing 17.5%, 15.5%, and 12.5%, respectively.
The insurance sector’s gross claims for the period stood at ₦297.9 billion, representing 36.6% of the gross premium income, with net claims at ₦259.4 billion, approximately 87.1% of the total gross claims.
The sector’s total assets also saw growth, rising by 9.5% quarter-on-quarter to ₦3.69 trillion. The non-life business accounted for ₦2.29 trillion, while the life business contributed ₦1.39 trillion.
Market concentration risk remains notable, with the top three life insurance companies holding around 43.8% of the total life premiums and the top three non-life insurers controlling 34.8% of the market share.
