X-raying Insurance Sector Stellar Growth
The insurance sector has in the past three years witnessed continuous growth due to several factors that have repositioned the industry as the fastest growing part of the finance services sector of the economy. Ebere Nwoji reports.
For the insurance sector, 2023,2024 and 2025 have been years of high growth record despite economic headwinds.
This consistent growth started in 2023 when the sector, despite all odds, achieved a record- breaking advancement and realised its dream of transforming from billion Naira market to trillion-naira market.
In 2022, the insurance industry was able to achieve its 14 year-long dream of trillion Naira premium income ascension given to it by NAICOM in 2009 by growing its annual premium from N726.2 billion, a 16-18 per cent year on year growth to an all -time high of N1.003 trillion.
Since the year 2023, the industry has been growing its premiums in high margins.
For instance, after the 2023 growth, in 2024, the sector delivered another record-breaking performance growing its premium by 49.4 per cent to close the year at N1.558 trillion in gross written premium.
In Q1 2024, premium grew by 51 per cent from N311 billion in Q1 2023 to N470.7 billion in Q1 2024. In second quarter 2024, the sector grew its gross premium from N551.4 billion in Q1 2023 to N813.1 billion. The sector’s total premium for 2024 stood at N1.562 trillion showing 56 per cent growth from the 2023 figure.
In Q1, 2025 the industry premium stood at N769.2 billion showing 63.4 per cent year-on-year growth. In Q2 2025, the sector recorded N1.21trillion premium a 49.3 per cent increase from the figure it recorded in the corresponding period in 2024. These results were contained in the Bulletin -of -the – Insurance- Market Performance published by NAICOM.
Sector’s Performance
A breakdown of the sector’s performance showed that major growth drivers in the non-life segment of the market were oil & gas and fire insurances, which contributed 27.3 per cent and 24.1 per cent respectively. Motor insurance contributed N114.8 billion, general accident generated N59.1 billion, marine N69.1 billion.
Net motor insurance premium stood at N100.3 billion, fire N75.3 billion, general accident 39.0 billion marine 33.5 while oil and gas stood at N54.6 billion. In terms of market performance percentages, motor insurance polled 66.5 per cent, fire polled 46.9 per cent, general accident 6.7 per cent, marine 30.9 per cent oil and gas 25.5 per cent. In the latest report of the industry’s performance in 2024 released by NAICOM on Monday,
Sustained Growth
Going by the regulator’s market performance review across the insurance sector, 2024 was described as one of the strongest growth years for the industry in recent history, reinforcing insurance as one of the fastest-expanding segments within Nigeria’s financial services industry.
NAICOM in areport said despite inflationary pressures, exchange rate volatility, and broader macroeconomic uncertainty, the sector maintained consistent upward momentum across all key performance indicators, including premiums, claims, assets, and retained earnings. As usual, the report said the industry in 2024 witnessed a non-Life Insurance Dominated Market Structure.
According to the report, non-life insurance segment remained the backbone of the industry, accounting for N1.060 trillion, representing 68 per cent of total gross premiums written in 2024.
Life insurance
The life insurance segment contributed N498.2 billion, or 32 per cent, reflecting the industry’s long-standing structural composition, where general insurance lines continue to dominate due to compulsory insurance classes and high-value commercial risks.
The report said within the non-life portfolio, oil and gas insurance emerged as the leading contributor, accounting for 33.7 per cent of total non-life premiums, followed by fire, motor, marine and aviation, general accident, and miscellaneous insurance classes.
Claims paid
Claims paid by the industry during the year (2024) rose by 50.9 per cent reflecting market expansion. The report also showed a significant increase in claims payments across the industry, which rose by 50.9 per cent year-on-year in 2024.
Non-life claims stood at N635.5 billion (68.6 per cent) and life insurance claims totalled N290.7 billion.
According to NAICOM, the rise in claims reflects both increased underwriting activity and expanded risk exposure, particularly in energy, transportation, and corporate insurance segments.
However, the Commission noted that claims levels remained within sustainable thresholds, reflecting strong underwriting discipline and improved risk management practices across the industry.
Total assets of the insurance sector rose by 31.7 per cent, reaching N3.957 trillion in 2024, underscoring continued financial strengthening and capital accumulation within the industry.
Non-life insurers held N2.395 trillion (60.5 per cent) and life insurers accounted for N1.562 trillion (39.5 per cent).
NAICOM stated that this structure reflects a stable and maturing market with improving balance sheet resilience across underwriting firms.
Growth Trajectory
NAICOM said between 2020 and 2024, the insurance industry recorded consistent double-digit growth, with no negative annual performance during the period. Gross written premium grew from N514.6 billion (2020) to N1.558 trillion (2024) — a 202.9 per cent increase. Non-life insurance expanded by 275.1 per cent. Life insurance grew by 114.9 per cent. Fire insurance recorded the highest five-year growth at 397.9 per cent, followed by Oil & Gas (288.7 per cent), Marine & Aviation (287.3 per cent), and Motor insurance (238.1 per cent).
NAICOM attributed this sustained performance to improved regulatory oversight, product diversification, and gradual expansion in insurance adoption across corporate and retail markets. The commission said life insurance recorded a 21.5 per cent growth rate in 2024, supported by rising demand for long-term savings, retirement planning, and group life schemes. Analysing market composition under life insurance, NAICOM said individual life policies took 45 per cent share, group life policies 30.6 per cent, annuity products 24.4 per cent. The commission noted there was steady expansion in life insurance uptake, though observation was made at low penetration levels compared to global averages.
Despite this growth, NAICOM acknowledged that insurance penetration in Nigeria remains low relative to the size of the economy. However, the commission expressed optimism that continued reforms, compulsory insurance enforcement, digital transformation, and public awareness campaigns would further deepen market penetration in the coming years.
In the year 2025, the commission said gross premium income of the industry stood at N2.302 trillion. This is in line with stakeholders’ prediction. They predicted that insurance premium this year would surpass N2 trillion. NAICOM in its Bulletin of Insurance Industry for Q4 2025 released yesterday recently said the sector’s statistics for the Q4 2025 showed an impressive quarter on quarter market performance, as the aforementioned premium quantum showed about 36 per cent and 47 .3 per cent growth rate on year on year basis.
According to the Commission, within the period under review, the industry statistics also indicated an increased market retention capacity compared to the prior period, increased industry size and improved business quality and profitability as well as exceptional performance reflective of the ongoing regulatory measures aimed at further deepening the market.
The commission said the industry’s impressive performance was largely influenced by the Oil and Gas business in the non-life and the growing annuity funds in the life segments of the market respectively.
“Indeed, the industry’s performance during the period has recorded many folds higher compared to the national output (3.9 percent underscoring its increasing relevance and structural importance in Nigeria’s financial ecosystem,” the commission said.
The commission described this as a commendable progress attributing it to increasing public confidence in the insurance market.
Performance Breakdown
Giving a breakdown of the performance, the commission said the non-life insurance segment continued to lead the market, contributing 68.4 per cent performance to the total premium pool, following its pattern in the corresponding quarter of 2024 while the life insurance business accounted for 31.6 percent during the period.
It further said Oil and Gas business remained leading portfolio, representing 30.3 percent of all the non-life premiums generated.
“The Fire Insurance followed with a notable position of 20.4 percent share while motor insurance accounted for 16.1 percent as miscellaneous, general accident, marine and aviation businesses also contributed 11.9 percent, 9.5 percent 8.7 percent and 3.2 percent respectively,” NAICOM said.
According to the Commission, on the other hand, the life insurance segment was led by annuity funds in contrast to the behaviour reported in the prior quarter, contributing about 44.3 per cent of all premiums recorded in the business.
It noted that Individual life business accounted for 36.2 per cent while group life contributed for 19.5 percent during the quarter under review.
It further said notwithstanding the events within the financial services sector, underwriters exhibited undoubted certainty and confidence as reflected in the robust retention levels across the market.
Claims Ratio
“During the period, the life insurance section recorded a notable claims settlement ratio of 65.5 percent while the non-life segment achieved a settlement rate of 75.5 percent of total claims reported during the period under review.
“The ratio of net claims paid compared to gross claims reported during the period has demonstrated some strong performance across various business classes,” it said.
In the non-life business, statistics showed that motor insurance recorded an outstanding ratio of 88.5 percent, followed by miscellaneous at 83.1 percent while general accident stood at 81.2 percent .Similarly, aviation, fire, marine and Oil and Gas insurance businesses also reported 80.5 percent 75.0, 68.1, and 61.0 percent claims ratios respectively during the period.
Responsible factors
According to industry analysts the positive performance of the insurance sector over the past three years (2023-2025) was the result of a powerful combination of regulatory enforcement, economic shifts, and strategic industry responses. While the growth in premiums is the headline figure, the key drivers lie beneath the surface, addressing long-standing challenges that have held the sector back.
The following are key factors that aides the sector’s recent growth: First is the recapitalisation Mandate (The “Big Push”). The passage of the Nigerian Insurance Industry Reform Act (NIIRA) 2025 and the impending June 2026 recapitalisation deadline are the most significant drivers.
It increased Financial Strength bringing the new minimum capital requirements from N3 billion to N15 billion for Non-Life and from N2 billion to N10 billion for Life companies and from N10 billion to N35 billion for reinsurers forcing firms to raise an estimated N600 billion in fresh capital.
The development also led to consolidation, forcing smaller, under-capitalised firms to merge or be acquired, leading to a market of larger, more resilient players capable of underwriting big-ticket risks.
Boosting Investor Confidence: The reform has attracted significant investor attention, reflected in the 41 percent rise in market capitalisation to N1.2 trillion in 2024.
Rebuilding Trust
A major barrier to insurance patronage has been lack of trust due to operators’ poor attitude to claims payment. But now, prompt payment of claims has become a key competitive metric and a strategic focus for the industry.
For instance, net claims paid surged by 53 per cent in 2024 to N622 billion, demonstrating a clear commitment to honouring obligations.
Also, there was stricter enforcement of compulsory insurance, as government agencies began to rigorously enforce policies that were previously widely ignored, dramatically widening the market base. For instance, in motor insurance, a strict enforcement blitz by the Nigeria Police Force on Third-Party Motor Insurance in early 2025 led to a massive surge in policy uptake.
Added to the above are digitalisation and product innovation, which are strong contributory factors as insurers are leveraging technology to reach new customers and improve service delivery.
