The total gross premium income reported in the Nigerian insurance industry remains stagnant at N520 billion in 2021 when compared to the figure in 2020 which was N592.3 billion.
This is according to the 2022 Insurance Industry report by Agusto and Co, a credit rating agency and provider of industry research and knowledge in Nigeria & Sub-Saharan Africa.
The report stated that this could be tied to the negative residues of the COVID-19 pandemic and the #EndSARS protests from 2020 which the industry had to grapple with.
Key highlight of the report
- Higher claims were paid to policyholders who suffered losses from looting and destruction that marred the #EndSARS protests in October 2020. As a result, the Industry’s gross premium income (GPI) remained stagnant at N520.1 billion (or $1.4 billion) when compared to the prior year.
- The Industry remains resilient with various initiatives by insurers to improve retail product penetration and boost GPI during the period.
- There was increased adoption of bancassurance to reduce the dependence on brokers and partnerships with Fintechs. The report however pointed out that enhanced bancassurance would allow insurance operators to leverage the more structured data and client base of the banking industry to deepen their reach in the retail market.
- The sharp switch to virtual channels, one of the many rapid changes witnessed during the pandemic induced lockdowns in 2020 was sustained in 2021 with individuals and corporates maintaining a significant online presence. While the trend is expected to continue, the report states that insurance companies can create targeted marketing campaigns aimed at re-orientating Nigerians to embrace insurance products with more people online.
What you should know
Nigeria insurance industry continued to witness rising claims after disruption in economic activities in 2020 following the lockdown and #EndSARS protest during the year
According to the Nigerian Insurers Association (NIA), insurance companies have paid out claims totalling about N9 billion to victims that suffered losses from the destruction that followed the #EndSARS protests.
In total, there were 99 claims settled on malicious damage, 8 on business interruption, 455 on burglary attack and 912 on fire and burnt sites. Similarly, the insurance companies settled 718 claims on vandalism; 93 cases on looting; 113 on theft, and 136 on loss of cash.