Insurance companies’ gross written premium rose to N520bn as of the end of 2020, while their assets hit N2.02tn as the sector undergoes recapitalisation, NIKE POPOOLA reports
The Nigerian insurance industry’s asset rose by N401bn to N2.02tn as of the end of 2020 from N1.62tn as of the end of 2019.
Statistics obtained on Sunday from the Central Bank of Nigeria on ‘Insurance sector (general and life) consolidated balance sheet)’ showed these.
The National Insurance Commission also disclosed in its report on ‘Market Development Drives of NAICOM’ that as of the end of 2020, the sector generated a gross written premium of N520bn.
Other statistics showed that as of the end of 2020, policies held by individual Nigerians were 1,034,383; corporate and non-individual policies were 891,128; total policies written were 1,925,511; while the insurance penetration during the period under review was 0.72 per cent.
In 2019, NAICOM mandated new capitals for the insurance and reinsurance firms.
It mandated that 50 per cent of the minimum paid-up capital for insurance and 60 per cent for reinsurance must be met by 31 December 2020.
Life and general insurance companies were asked to shore up their existing minimum paid-up capital from N2bn and N3bn to N4bn and N5bn respectively by the end of December 2020, and meet the final minimum paid-up capital requirements of N8bn and N10bn respectively by the end of September 2021.
Composite companies and reinsurance firms were asked to shore up from existing minimum paid-up capital of N5bn and N10bn to N9bn and N12bn by the end of December 2020 and to N18bn and N20bn respectively by the end of September 2021.
However, the December deadline failed to be implemented as some dissatisfied companies, using their shareholders, dragged the regulator to court.
The operators also urged NAICOM to amend its paid up capital requirement to consider other assets aside from cash, which the regulator did not grant.
In December 2020, the House of Representatives asked NAICOM to suspend the December 31, 2020 deadline, while two legal actions in Abuja and Lagos, instituted against the regulator, were still pending in courts.
This, coupled with the court actions, led the commission to suspend the first phase of the recapitalisation, leaving the second phase scheduled to end by September 2021.
However, some underwriters had declared on their own that they met the requirements before the first phase of the recapitalisation was suspended.