The 58 insurance industry in the country underwrote estimated N520 billion risk businesses in the last financial year, even as the sector targets N1.5 trillion gross premium income in the next three years, LEADERSHIP can now reveal.
Although, only a pocket of insurance firms have so far submitted their 2020 financial results to the insurance industry regulator, that is, the National Insurance Commission(NAICOM) as at the time of writing this report, the regulatory body estimated that the premium income for the industry would hit N520 billion by the time all underwriters submit their annual reports.
NAICOM, according to findings, based its projections on the 2020 quarterly and half year reports previously submitted to it by insurers as well as reports from its officers on the field.
With the industry able to pull N520 billion annual gross premium in 2020, this translates N30 billion premium growth from the N490 billion recorded in the 2019 financial year end, despite the effect of Covid-19 pandemic on the nation’s economy which prevented some previously insured from renewing their insurance policies.
As the economy continues to open up post Covid-19 as well as increasing insurance awareness as a result of the twin risks of EndSARS destruction and the pandemic which financially affected uninsured businesses, NAICOM expects the annual premium to jump sporadically between 2021 and 2023 financial years, hence able to hit N1.5 trillion in the next three years.
Speaking on this, at the annual seminar organised for insurance journalists in Lagos recently, the commissioner for insurance/CEO, NAICOM, Mr. Sunday Thomas, said, the commission is optimistic of this target given the industry restructuring and reforms that have taken place in the last one year of his administration.
He stated that the target would be heavily driven through digitalisation of insurance services, strong collaboration with federal government’s ministries, departments and agencies(MDAs), state governments as well as relevant regulatory and enforcement agencies to grow insurance industry and increase its contribution to the nation’s Gross Domestic Product(GDP).
Similarly, the head, corporate communications and market development, NAICOM, Mr. Salami Rasaaq, in a paper entitled: ‘Market Development Drives of NAICOM: Initiatives and Prospects,’
stated that, the entire insurance industry’s annual premium in 2020 was N520 billion, with penetration of less than one per cent, while insurance density is less than three per cent.
Stating that NAICOM was embarking on a market development drive that will enable it achieve N1.5 trillion annual premium income for the insurance sector, he said, the regulatory body also targets 10 per cent insurance penetration and 10 per cent insurance density by 2023.
He equally disclosed that the total number of individuals with insurance policies in 2020 reached 1.03 million while that of corporate organisations totaled 891,128, bringing the total insurance policyholders in 2020 to 1.9 million.
NAICOM will work around four strategic themes which are: increasing insurance awareness and education, partnership with stakeholders, focusing on high impact media productions, as well as social/digital transformation of the commission.
Explaining that the strategies would serve as a guideline to achieving the growth projection in the next two years, he pointed out that, through partnership with the government and stakeholders, the commission would improve awareness at all levels of business as well as promoting micro-insurance and Takaful insurance by enforcing compulsory insurances across the country.
To realise the gross premium income target, he said, the commission would launch thought leadership series as well as stakeholders’ forum and town hall meetings, even as it planned to build a massive media campaign to spread the gospel of insurance.
The projection, he stressed, would be achieved through working with small and medium cohorts across geo-political zones; building trust among the insured leading to more referrals; building confidence in the sector by reducing incidences of fake insurance and implementing penalty for non payment of claims as well as working with digital companies with access to data and information for wider reach and impact.
Earlier, the head, Information Technology(IT), NAICOM, Mr. Abiodun Aribike, promised that insurance processes and services would be fully automated going forward with the launch of the NAICOM portal.
The portal, he said, when fully launched, would be a warehouse of data as policies sold in the industry would be documented on the platform, promising that, the new platform would curb the invasion of racketeers in insurance industry.