THE Nigerian insurance industry recorded 61 percent significant growth year-on-year in the third quarter (Q3) of 2024, hitting N1.2 trillion gross premium mark, while total assets reached N3.9 trillion.
The achievement recorded was disclosed by Mr Kunle Ahmed, Chairman of Nigerian Insurance Association (NIA) during a quarterly news conference on the performance of the industry in Lagos, recently.
Ahmed, who attributed this growth largely to the non-life insurance sector, said, “The 2024 performance of the insurance industry revealed a complex landscape marked by significant growth in certain areas alongside persistent and emerging challenges.
“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 the third quarter of 2024 indicated robust growth in gross premiums.
“The report from our regulator noted a 61 percent year-on-year increase in the third quarter of 2024, reaching N1.2 trillion. This growth was largely driven by the non-life insurance sector, which constituted approximately 69 percent of the total premium income.”
Ahmed highlighted that within the non-life business, fire, oil and gas insurance were significant contributors to the increased revenue and explained that all non-life business products showed robust quarter-on-quarter growth.
He stated the life insurance business also experienced substantial growth, with the report indicating a 45 percent quarter-on-quarter increase within the period under review.
According to him, the Group Life emerged as the largest premium-generating component within the life segment.
Giving more details, Ahmed further stated, “In spite a rise in the net loss ratio in the second quarter of 2024 compared to the first quarter of 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.”
Delving into the impact of the police enforcement on third-party motor insurance, Ahmed said the enforcement process had generated significant effects on the insurance industry and policyholders in Nigeria.
Ahmed said that the most immediate and significant impact was the substantial increase in the purchase of third-party motor insurance policies, explaining that the surge in demand directly translated to higher premium income and overall revenue growth for insurance companies.
Available reports, according to him, indicate a significant increase in the uptake, as the trend is expected to be amplified by continued enforcement in 2025 and beyond.
“The increase in uptake implies increase in the volume of claims and overall potential liabilities of insurance companies.
This will necessitate that insurance companies enhance their claims processing efficiency and customer service capabilities to handle the increased workload and ensure policyholder satisfaction.
“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.
“Overall, the stricter enforcement of third-party motor insurance in Nigeria is a crucial step towards ensuring financial protection for road accident victims and improving legal compliance.”
He pointed out that policyholders needed 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.
Ahmed said the National Insurance Commission (NAICOM) had always advised the populace on verifying insurers on their website.
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