… as Insurance companies’ customers claim N318.2 billion
The total assets of the insurance industry stood at N2.33 trillion in the fourth quarter of 2022, says a report, Statistics Department Quarterly Report of the Insurance Market.
According to the report, the figure represents positive growth that signifies expansion at the rate of 2.4 percent, quarter-on-quarter, and at 4.4 percent year-on-year.
The report, in a bulletin of the Insurance Market Performance, was made available by the National Insurance Commission (NAICOM) on Thursday in Lagos.
The report said the market size distribution in terms of the total assets recorded with respect to life insurance stood at 1.22 trillion, while the non-life insurance businesses during the period stood at 1.12 trillion.
It noted that the result was relatively at a lower momentum compared to the prior period when the progression rate was recorded at about nine percent year-on-year.
It also attributed the downturn to the wave of recapitalisation drive recorded in that period.
“However, the outlook of the market growth in terms of assets remains positive, with the increasing measures of market deepening and development and recapitalisation drive still ongoing.
“Also, regulatory insurance laws provisions enshrined in the Insurance Bill, being reviewed and digitisation of the supervisory wide processes would lead to the realisation of the vast potential in the insurance industry.
According to the report, statistics of the insurance market performance for the quarter under review revealed consistent growth in terms of premium generation and quality improvements in essential indicators including claims settlement and profitability.
It said: “It is obvious that the market could be ruled as sound and stable, whilst the stance of the market deepening remains optimistic in spite of operational and macro-economic challenges.”
The insured made claims of N318.2 billion on insurance companies in the last quarter of 2022.
In a related development, the National Insurance Commission (NAICOM), regulator of the industry stated in Lagos on Thursday that the claims represented a 31.2 percent Quarter-on-Quarter growth from the previous quarter.
It attributed the growth to rising awareness, market expansion and consumer confidence.
It stated that net claims paid amounted to N244.3 billion, growing at about 18 percent Quarter-on-
Quarter during the same period.
NAICOM noted that the non-life insurance segment indicated that motor insurance led the result of claims settlement vis-a-vis gross claims at 92.3 percent, signifying a nine-point improvement as against its prior position.
According to the commission, fire insurance is the least with 46.3 percent, which is the only class below average proportion.
The commission reported that all other portfolios recorded a proportion above the average of paid claims, against gross claims reported.
They are General accident insurance at 80.7 percent; Oil and Gas at 51.6 percent, Marine and Aviation with 74.4 percent, and miscellaneous insurance with 86.1 percent.
It stated that life insurance reported two points lower in comparison to the 95 percent of net claims paid, compared to total claims reported in the corresponding period of 2021.
“The data revealed an impressive development with regard to claims settlement in non-life business with a record of 63.7 percent compared to the previous period of 46.9 percent.
“It, therefore, indicates that despite operational challenges, the claims settlement experience of insurers is improving,’’ it stated.
NAICOM added that the market recorded about 47.2 percent net loss ratio during the period under review, suggesting a workable, cost-effective and profitable business in the industry.
It attributed the performance mostly to the life business sustaining its positive course at 46.5 percent net loss ratio in the current period while the non-life portfolio recorded about 48.1 percent during the same period.
“Comparatively, the market recorded an aggregate market average of 54.5 percent of net loss ratio in the previous period, hence depictive of an improved aggregate market desirability and profitability during the current period.
“Six companies with net loss ratios above 100 percent were majorly responsible for the average industry loss registered for the period,’’ the regulator stated.
