Report: Insurers Raked in N413bn Gross Premium in 2019


Ebere Nwoji

The insurance industry in 2019 generated a total gross premium of N413.8 billion, according to statistics obtained from the latest edition of the insurance industry digest produced by the umbrella body of insurance underwriters, the Nigerian Insurers Association (NIA).

This represented an increase of N13.8 billion, compared with the N400 billion recorded in 2018.

The report showed that the industry has sustained the path of marginal growth in the past three years.

In 2018, it recorded 10 per cent growth in gross premium generation from N363 billion in 2017, to N400 billion in 2018.

Of the amount of gross premium realised by the industry in 2019, insurance brokers generated N220.89 billion. This represented a 53.37 per cent of the gross premium income recorded by the insurance industry.

The industry has over the years been struggling to meet its target of transforming from billion-naira premium income market to a trillion-naira market through the various market developmental programme.

For instance, the National Insurance Commission (NAICOM) has introduced a Market Development and Restructuring Initiative (MDRI).

NAICOM said through the initiative, it would deepen insurance penetration to ensure that insurance services through the agency system were brought to the doorstep of every Nigerian.

The NIA document also showed that insurance agents generated N107.83 billion, which was 26.05 per cent of the total gross premium.

Businesses from direct sales gave the industry N29.01 billion, representing 7.01 per cent.

Similarly, bancassurance yielded N30.37 billion, which was 7.34 per cent of the entire premium generated within the period.

Businesses through the e-channel stood at N1.50 billion, representing 0.36 per cent while businesses from other distribution channels yielded N24.25 billion, representing 5.86 per cent of the total gross premium.

The report also showed that non-life operators paid N29.33 billion as commission.

It gave a breakdown of what each underwriting firm generated in terms of gross premium, stating that the top leading firms were Leadway Assurance Limited, which garnered N87.52 billion gross premium; AIICO Insurance Plc – N25.98 billion; and FBNInsurance Limited – N23.03 billion.

In terms of claims settlement, the top three firms were: Leadway Assurance Limited, which paid N57.93 billion; AIICO Insurance Plc – N28.55 billion and African Alliance Insurance Plc – N8.75 billion.

In terms of general claims payment by the industry, the report stated that the industry in 2019 paid a total gross claims of N193.5 billion

Reinsurance treaties payment stood at N193.5 billion, Net Premium Income stood at N287.8 billion while total underwriting profit stood at N56.6 billion.

Also, profit before tax stood at N40.2 billion; profit after tax at N31.5 billion; shareholders’ fund at N378.3 billion and insurance sector total assets at N1.2 trillion

Similarly, management expenses for the period under review was N88.9 billion.

The above figures were generated by a total of 58 insurance and reinsurance firms operating in the country.

Insurance penetration for the period was put at 1.6 per cent, while contribution of the industry within the period still stood as low as 0.34 per cent

Also, number of employees in the industry during the period stood at 6,731 (male 60 per cent and female 40 per cent).

NAICOM recently extended the insurance sector recapitalisation deadline to December 31, 2020, from the June 2020 deadline it had stipulated previously.

The commission announced the shift in a circular signed by its Director, Policy and Regulation Directorate, Mr. Pius Agboola.