Daily Independent (Lagos)
Sola Alabadan
30 June 2009
analysis
Lagos — Nigerian Insurance companies generated a premium income of N164 billion for the financial year ended December 31, 2008. This represents a growth of 63.5 per cent over N100.6 billion recorded in 2007.
Chairman of the Nigerian Insurers Association (NIA), Wole Oshin, who disclosed this during the 38th Annual General Meeting (AGM) of the association in Lagos, also informed that insurance companies in the country paid claims amounting to N53.3 billion in 2008 as against N35.2 billion paid during the previous year. NIA is the umbrella body of all the 57 insurance companies operating in the country.
The sector also increased its total capitalisation to N670 billion from less than N200 billion in 2007.
Considering the impressive results recorded during the last operating year, the NIA boss stated that the sector is well positioned to deliver on its promise following its successful recapitalisation exercise.
Consequently, Oshin said that the current figures are expected to be surpassed in 2009 as companies continue to device strategies to overcome the ravaging effects of the global economic meltdown.
On the impressive claims pay out, he said this further attests to the ability of the insurance companies to pay all genuine claims promptly and expeditiously.
A further breakdown of the industry's results show that out of the total premium figure, fire insurance contributed N16.98 billion; Motor Insurance accounted for N41.23 billion, while General Accident insurance contributed N40.87 billion.
The result also reveals that Marine and Aviation insurance recorded N39.63 billion, while life insurance added N25.81 billion.
The NIA Chairman further hinged his optimism in the coming year on the cordial relationship between the NIA and the National Insurance Commission, which he said would lead to full implementation and compliance with various provisions of the Insurance Act 2003.
According to him, the two bodies are working together to ensure that issues relating to Local Content on Oil and Gas, Compulsory Insurances of Public Buildings and Buildings Under Construction as well as enforcement of Third Party Motor Insurance cover are implemented.
Oshin also expressed hopes that the implementation of the FSS 2020 report will have positive impacts on the insurance industry, stressing that the report will make significant impact on the performance of the industry and increase its contribution to the Gross Domestic Product (GDP).
"The association is fully represented in the FSS 2020 Committee on insurance and is expected that the Committee report will provide the blue print that will make Nigeria the safest and fastest growing financial system in the emerging market, he noted.
Again as part of effort to address the many challenges of ethical practice and instill discipline in the industry, Oshin reported that his administration has initiated industry market agreement which has already been signed by all member companies. He further expressed optimism that this would be implemented within the shortest time possible.
Reacting to the industry's financial performance during the out gone year, Justus Uranta, managing director, Niger Insurance Plc, said the industry is growing from strength to strength going by increasing level of income, claims profile, as well as improved service delivery. He said that the industry is only hoping for the better, which he noted would benefit the insurance consumers, the Nigerian public and the economy at large.
Within a period of three years, insurance companies in the country have paid a total of N65 billion in claims, with another N53 billion for last year the figure now stands at N118 billion.
The operators are hoping with the total claims paid during the period under the review, this will go a long way to correct the erroneous impression that insurance companies don't usually pay claims when the need arises.
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