By Bisi Bamishe
The insurance sector has witnessed a slight boost in total assets which stood at N3.88 trillion in the third quarter of last year as against N2.81 trillion recorded in the corresponding period in 2023, representing 5.1 per cent.
The breakdown showed a total of N2.34 trillion of assets is attributable to Non-Life business, while the Life business accounted for N1.54 trillion at the end of the quarter under review.
According to NAICOM, the sector showed resilience amid macroeconomic challenges, sustaining the industry growth trajectory at 60.9 per cent, year on year, and 44.3 percent on a quarter-on-quarter basis, to close at about N1.17 in gross premium written.
In the same vein, Gross Premium Written in Q3 of the same period stood at N1.17 trillion, a remarkable occasion attributable to the consistent deepening policy of the Commission and market resilience.
The Commission further stated that the performance was majorly led by the non-life sector, recording a market share of 68.9 per cent for a total volume of N808.4billion while the life segment accounted for 31.1 per cent of the market premium aggregate.
Claims payment improved as NAICOM said it served as a driver for expansion in gross claims reported in Q3 2024, reaching N564.1 billion which is representative of about 48.1 per cent of the total premiums generated during the period.
“This underscores the need for accelerated premium growth and appropriate rate setting. The Life Insurance segment recorded an impressive claims settlement ratio of 81.6 per cent, while the Non-Life segment achieved 73.6 per cent. The ratio of net claims paid demonstrated strong performance across various business classes with motor insurance achieving an outstanding ratio of 92.3 per cent; followed by miscellaneous at 88.9 per cent; general accident and fire businesses recorded 86.3 percent and 75.1 per cent respectively.
“The Oil & Gas business, while lower at 63.7 per cent, showed significant progress compared to 43.1 per cent recorded in the corresponding period of the previous year. The improvement in the Oil & Gas in terms of the ratio of net claims paid despite recording some low retention during the same period signifies the potential of that business if only the existing capital gaps would be addressed.
“The insurance market demonstrated profitability during the period under review, achieving an overall net loss ratio average of 62.8 per cent. The Non-Life segment recorded a loss ratio of 66.7 per cent, while the Life business reported 57.4 per cent during the period, representing a significant improvement in the profitability position of the life segment with about seven points increase from 64.8 percent recorded in the corresponding prior period, highlighting an enhanced market performance and a positive outlook. Nonetheless, despite a rather good scenario of the market average, some eleven Insurers gave rise to the reported net loss ratio during the period under review,” NAICOM added.
