Agusto & Co. Limited, a pan‑African credit rating agency and business information provider, reported that Nigeria’s insurance industry’s gross premium for 2022 will exceed N700 billion, driven by increased economic activity. This finding appears in the firm’s 2023 insurance industry report, “The Nigerian Insurance Industry – Poised to Survive the Weak Macro Economy and an Election Year.” According to Agusto & Co., the industry’s estimated gross premium income maintained its double‑digit growth trend and crossed the N700 billion mark in FY 2022. The premium uplift resulted from several factors, including improved economic activity and stronger regulatory support.
The 2023 annual report offers a comprehensive review of Nigeria’s insurance landscape and near‑term expectations for the sector. It examines how the industry performed amid lingering macro‑economic headwinds and outlines the outlook for an election year. While FY 2021 performance was moderated by claim payouts linked to the violence that followed the #EndSARS protests, Agusto & Co. notes that such outflows were minimal in 2022 because the crisis was non‑recurring. Consequently, the industry’s estimated net claims for FY 2022 rose by a slower 13 percent relative to the previous year. Nevertheless, inflationary pressures continued to adversely affect claim settlements, underwriting costs, operating expenses, and profitability indices.
Agusto & Co. also highlighted that the country’s insecurity gaps, infrastructural shocks, and the aftermath of the #EndSARS protest underscored the benefits of insurance products, particularly fire and general accident policies. A notable development in 2022 was the increase in third‑party motor insurance policy rates announced by the National Insurance Commission (NAICOM) on 22 December 2022. NAICOM raised the new premium for private motors to N15,000, staff buses to N20,000, commercial trucks/general cartage to N100,000, commercial tricycles to N5,000, and commercial motorcycles to N3,000, up from a basic rate of N5,000. Additionally, NAICOM stipulated that the comprehensive motor insurance premium rate should not be less than five percent of the sum insured after all rebates or discounts. Although the policy attracted some criticism, Agusto & Co. believes it will cushion rising loss rates in the motor line and support a boost in gross premium income (GPI) in FY 2023.
The report further asserts that Nigeria’s political environment will shape the 2023 financial year for insurers. “The first half of 2023 will be characterised by electioneering activities, while the second half will bring a new administration and fresh ideas for fiscal and economic transformation,” it states. Possible election‑related violence poses a downside risk that could adversely affect insurers, especially if it becomes widespread across several states. Conversely, there will be opportunities to secure new public‑sector insurance contracts, particularly in the latter half of the year.
Overall, Agusto & Co. expects a modest industry performance in FY 2023, supported by a rising yield environment. Initiatives such as the bancassurance model—enabling insurers to partner with banks to deepen retail market reach—are also seen as bolstering the sector.
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