Q3 2024: Insurance Sector Premium Growth Up 61 % to N1.2trn
Ebere Nwoji
Despite high inflation rate and other economic woes plaguing businesses in the country, stakeholders in the Nigerian insurance industry have said that the sector has remained resilient having successfully raked in N1.2 trillion annual premium income as at the end of Q3 2024.
This indicates 61 per cent year-on-year growth when compared to N1.003 trillion premium achieved in the same period in 2023.
This was disclosed by the Chairman Nigeria Insurers Association (NIA), Mr. Kunle Ahmed in his report on Insurance Industry Performance for 2024.
Ahmed, while addressing the media at the NIA Secretariat in Lagos, said the 2024 performance of the insurance industry, revealed a complex landscape marked by significant growth in certain areas alongside persistent and emerging challenges.
He noted that while specific data for the entire year of 2024 is still being consolidated, the trends and available reports offer valuable insights.
“Available data up to the end of Q3 2024 indicated robust growth in gross premiums with a 61 per cent year-on-year increase in Q3 2024, reaching N1.2 trillion. This growth was largely driven by the non-life insurance sector, which constituted approximately 69 per cent of the total premium income. Within the non-life business, Fire, Oil & Gas insurance were significant contributors to the increased revenue. All non-life business products showed robust quarter-on-quarter growth,“ Ahmed said.
According to him, life insurance business also experienced substantial growth, with the report indicating a 45 per cent quarter-on-quarter increase in Q3 2024.
He observed that Group Life emerged as the largest premium-generating component within the life segment.
Ahmed said despite a rise in the net loss ratio in Q2 2024 compared to Q1 2024, the Nigerian insurance market remained profitable overall. The total assets reached N3.9 trillion by the end of September 2024, demonstrating a healthy expansion.
On the impact of Police Enforcement of 3rd-Party Motor Insurance, he said stricter enforcement of the Policy which commenced February 1, 2025,was generating significant effects on both the insurance industry and policyholders in Nigeria.
“The most immediate and significant impact is the substantial increase in the purchase of third-party motor insurance policies. This surge in demand directly translates to higher premium income and overall revenue growth for insurance companies. Available reports indicated a significant increase in the uptake, and this trend is expected to be amplified by continued enforcement in 2025 and beyond,” he said.
He however said the increase in uptake implies increase in the volume of claims and overall potential liabilities of insurance companies, adding that this would necessitate that insurance companies enhanced their claims processing efficiency and customer service capabilities to handle the increased workload and ensure policyholder satisfaction.
He added, “Stricter checks by the police make the use of fake or invalid insurance certificates riskier. This enforcement, coupled with the use of the Nigeria Insurance Industry Database (NIID), is expected to reduce the prevalence of fraudulent policies. As more genuine policies are purchased and recorded in the NIID, the overall quality and reliability of insurance industry data will likely improve. This can aid in better risk assessment and management for insurers.”
He said more importantly, the enforcement drive raises public awareness about the mandatory nature and benefits of third-party insurance, adding that timely and efficient payment of claim obligations would gradually lead to increased public trust in the insurance sector.
“Interestingly, the increased awareness and enforcement can create opportunities for insurers to develop more attractive and user-friendly third-party insurance products and leverage technology (Insurtech) to improve service delivery,” Ahmed added.
“For policyholders, the primary impact is a higher rate of compliance with the mandatory third-party motor insurance law to avoid potential penalties,” he said.
He further noted that stricter enforcement ensures that more victims of road accidents involving insured vehicles could receive the legally mandated financial compensation for bodily injury, death, or property damage (up to N3 million for property damage).
He said, “Genuine third-party insurance policies in Nigeria now include coverage under the ECOWAS Brown Card scheme, offering protection when driving in other West African countries. Compliant policyholders avoid the risk of facing fines (up to N250,000), vehicle impoundment, and potential imprisonment for driving without valid third-party insurance. Having valid insurance and adhering to the law can provide vehicle owners with a greater sense of security and peace of mind while driving.”
According to Ahmed, Policyholders need to be well-informed about the scope and benefits of their third-party insurance policies and how to verify their authenticity to avoid purchasing fake policies, adding that NAICOM advises verifying insurers on their website.
In terms of claims from the Third Party Motor Insurance policy, Ahmed said: “We are committed to a timely processing and payment of all valid claims. For policyholders, it ensures greater financial security for third-party liabilities and avoidance of penalties. Effective regulation, transparent enforcement, and continuous public education are essential for the successful implementation and long-term benefits of this initiative.”
