Nigeria’ Insurance Industry Premium To Rise Above N700bn In 2023 – Report


Agusto & Co. Limited, a pan-African credit rating agency and business information provider has reported that Nigeria’s insurance industry gross premium will rise above N700bn recorded in 2022 as economic activities progresses after the 2023 election.

It stated this in its 2023 insurance industry report titled ‘The Nigerian insurance industry – Poised to survive the weak macro economy and an election year’.

According to Agusto & Co, “The Nigerian insurance industry’s estimated gross premium income maintained its double-digit growth trend and crossed the N700bn mark in FY 2022. The uptick in the industry’s premium was driven by several factors including improved economic activities and stronger regulatory support.”

The 2023 annual report showed a comprehensive review of the insurance landscape in Nigeria and the near-term expectation for the industry.

It also contained a review of how the Nigeria’s insurance industry had fared amid the lingering macroeconomic headwinds and outlook for the industry in an election year.

While the industry’s performance in FY 2021 was moderated by the payout of claims emanating from the violence that trailed the #EndSARS protest, it stated, such outflows were minimal in 2022 given the non-recurring nature of the crisis.

Consequently, the Nigerian insurance industry’s estimated net claims for FY 2022 rose by a slower 13 per cent relative to the previous year, it said.

Notwithstanding, inflationary pressures continued to adversely impact claims settlements, underwriting costs, operating expenses and also moderate profitability indices.

Agusto & Co. also recognised that the country’s insecurity gaps, infrastructural shocks and aftermath of the #EndSARS protest had emphasised the benefits of insurance products, particularly fire and general accident policies.

It stated, “One of the most notable highlights of the industry in 2022 was the increase in third-party motor insurance policy rates by the National Insurance Commission, the apex regulator, 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. These policies previously had a basic rate of N5,000.”

In addition to the new premium rates, it added, NAICOM announced that the comprehensive motor insurance policy premium rate should not be less than five per cent of the sum insured after all rebates or discounts.

Although the policy had received some criticisms, Agusto & Co. stated that it would cushion the rising loss rates from the associated business line and support a boost in GPI in FY 2023.

It added that Nigeria’s political environment would define the financial year 2023 for insurance operators.

The report said, “The first half of 2023 would be characterised by electioneering activities while the second half would bring a new administration and fresh ideas for fiscal and economic transformation.

“Possible election violence poses a downside risk that could adversely impact insurance operators, especially if it is a widespread occurrence across several states.

“However, there will also be opportunities to secure new insurance contracts from the public sector, especially in the second half of 2023.”

The report said, “Overall, Agusto & Co. expects a modest performance by the industry in FY 2023, supported by the rising yield environment. Initiatives such as the bancassurance model which would enable insurance operators to partner with the banking industry to deepen their reach in the retail market will also bolster the Industry in our view.”


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