By Nike Popoola
Between 2004 and 2013, the Nigerian insurance industry earned as premium N1.5tn from all life and non-life insurance policies underwritten.
Statistics obtained from the Nigerian Insurers Association revealed that the sector made premiums of N69.4bn, N76.3bn, N82.3bn and N100.6bn in 2004, 2005, 2006 and 2007, respectively.
The figure rose to N150bn, N179.9bn, N185.7bn and N217.7bn in 2008, 2009, 2010 and 2011 respectively, while in 2012 and 2013, the insurance industry earned N247.58bn and N285bn, respectively from the businesses underwritten.
According to the NIA, while the general insurance business has continued to contribute more to the sector’s earnings, the overall contribution of the life business has remained low.
From instance, the life business only earned N11.3bn, N14.6bn, N29.3bn, N34.3bn and N39.7bn in 2006, 2007, 2008, 2009 and 2010, respectively.
According to the NIA, the increase in the last financial year’s premium can be attributed to the relative stability and sustained growth in the economy, increasing insurance awareness and government patronage of insurance services.
It noted that innovations and improved service delivery by member companies as well as the growing confidence in the insurance system by the general public aided the sector’s growth.
The association stated that the performance was also aided by better regulatory supervision on the account of the release of guidelines for risk-based supervision; anti-money laundering and combating financial terrorism guidelines; and the adoption of the full International Financial Reporting Standards for the 2012 accounts.
It said the enforcement of the provision of Section 50(1) and (2)… on premium payment and the regulation on premium collection and remittance had begun to yield the desired results, particularly in terms of curtailing large volume of premium debt in the balance sheets of member companies.
Between 2001 and 2005, according to NIA, the growth rate of premium from life insurance business stood at 24.5 per cent, 29 per cent, 22.4 per cent, 20.4 per cent and 6.1 per cent, respectively.
The growth rate also rose from -1.5 per cent, 23.8 per cent and 85.8 per cent in 2006, 2007 and 2008.
The figure fell from 16.9 per cent to 15.9 per cent between 2009 and 2010, thus revealing an average growth rate of 24.3 per cent in the 10-year period.
According to the NIA, the sector recorded an average growth rate of 22.1 per cent between 2001 and 2010 in the non-life business.
The data revealed that between 2001 and 2002, the average growth rate of the non-life business rose from 26.2 per cent to 35.6 per cent, but fell in 2003, 2004, 2005 and 2006 to 26.9 per cent, 25 per cent, 10.7 per cent and 7.4 per cent in that order.
The growth rate of the non-life business, however, rose from 24.9 per cent in 2007 to 44.1 per cent in 2008, but fell again to 19.6 per cent and 0.9 per cent in 2009 and 2010.
The Chairman, NIA, Mr. Gus Wiggle, said the association was committed to deepening insurance in the country by sustaining the sector’s growth.
"The association is appreciative of the efforts of the National Insurance Commission in promoting microinsurance to deepen insurance penetration in Nigeria. Our administration will take up the challenge by encouraging member companies to institute corporate structures that will ensure the success of the initiative," Wiggle said.
Source Punch
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