The gross premium of the insurance sector in Nigeria increased by 49 percent quarter-on-quarter (Q/q) and 77 percent year-on-year (Y/Y), according to the latest data from NAICOM.
According to FBNQuest’s monthly report, the total premium income of the insurance sector amounted to N551,4 billion as of the end of Q2 ’23, compared to N369,2 billion in the same period of 2022.
“Nigeria’s insurance sector continued to grow at a double-digit rate in spite of a number of macroeconomic headwinds, such as high inflation, increasing energy prices and foreign exchange shortages,” FBNQuest’s analysts wrote in their report. “The strong y/y increase in premium revenue was driven by a 81 percent increase in non-life premiums to N362,4 billion.”
All non-life segments grew significantly, with fire insurance accounting for the largest increase at 34 percent. The life insurance business grew 77 percent year-on-year (YoY) to N189,0 billion in the second quarter of 2022. Cumulatively, the sector’s total premium income grew by 45 percent YoY, reaching N862,9 billion in the first half of 2022.
In terms of the industry’s total assets, the industry grew by 18 percent YoY to N2,7 trillion at the end of Q2 ‘22. The modest YoY increase in the total assets was driven by a 33 percent YoY growth in the assets of the Non-Life insurance business, which grew YoY to N1,6 trillion, while the total assets of the Life insurance business remained flat YoY at N1,1 trillion.
The insurance sector grew at a CAGR of 7.3% YoY, following YoY growth rates of-8.0% YoY in the first quarter of 2022 and-6.9% YoY in 2021.
While the insurance sector has made considerable progress in recent years, it still has a long way to go in addressing the low level of insurance penetration in the country, FBNQuest analysts said.