Listed insurers premium hits five year high of N172.62 billion in Q3
Listed insurers’ gross premium income has been rising steadily since 2014 despite operating in a difficult economic and political condition, as the industry continues to play catch-up to some sub-Saharan African countries.
The charts show the cumulative gross premium income (GPI) of 19 largest insurers listed on the floor of the bourse increased by 11.54 percent to N172.76 billion in September 2018 from N152.35 billion as at September 2017, according data compiled by Markets and Intelligence.
But the 11.54 percent growth in the period under review is lower than the 22.23 percent recorded in the third quarter of 2017 – the country existed recession in the third and fourth quarter of 2017- while it is higher than the 8.06 percent and 6.57 percent recorded in the 2016 and 2015 financial years.
A breakdown of the figure shows Aiico Insurance’s GPI was up 15.97 percent to N25.92 billion in September 2018, from N22.35 billion the previous year.
Source: Company Financials; M and I
AxA Mansard Insurance’s GPI grew by 25.74 percent to N24.711 billion in the period under review from N19.65 billion the previous year.
Source: Company Financials; M and I
Continental Reinsurance’s GPI has been increasing since 2014. Revenue was up 21.33 percent to N26 billion in the period under review as against N21.43 billion.
Source: Company Financials; M and I
Consolidated Hall Mark’s GPI was up 19.14 percent to N5.20 billion in September 2018 from N4.30 billion the previous year.
Source: Company Financials; M and I
Despite the improvement in revenue among listed insurers, the country’s insurance penetration as a percent of GDP is just 0.27 percent, a figure that is abysmally poor when compared with the figures of six Sub-Saharan countries, according to a 2016 insurance sector report by PricewaterhouseCoopers “African insurance industry poised for growth”
For instance, South Africa insurance penetration to the economy is 14.28 percent; Namibia; 6.87 percent, Mauritius; 6.40 percent, Morocco; 3.48 percent, Kenya 2.80 percent, and Tunisia 1.97 percent, according to PWC.
Source: Company Financials; M and I
South Africa insurance market has been buoyed by high literacy level, a burgeoning middle class that crave for consumption, and the introduction of innovative products that meets the needs of consumers.
Nigeria’s insurance industry is fraught with challenges such as high poverty rates, lack of innovation, lack of trust, poor risk management, which are major impediment to growth of the industry.
Source: Company Financials; M and I
An industry expert who didn’t want his name mentioned said that government has been lethargic in enforcing the compulsory insurance, which is why premium income has not been growing at a blazing speed.
Experts also added that for insurers operating in Nigeria to achieve exponential growth, they will have to find innovative and cost effective ways to increase penetration.