Published On: Wed, Jun 15th, 2016

Insurance industry contributes 0.5% to GDP despite growth potentials

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The executive director, Leadway Assurance, Adetola Adegbayi has said that Nigeria insurance industry has been recording slow growth despite enormous potentials.

According her, Nigeria’s insurance penetration (IP) remains at under 0.5 percent based on rebased Gross Domestic Product (GDP) despite absolute growth in premium which stood at N252.1 billion in 2012 at N160 to a US$1 at rebased GDP of US$451billion-0.349 percent.

She stated that insurance industry recorded N285 billion premium in 2013 at N167 to a $1 with a rebased GDP of 521.8 billion showing 0.3e7 percent IP and N302 billion in 2014 at N191 to a $1 indicating 0.278 IP, which shows the industry growth being at variance with economic expansion and possibly flat when inflation adjusted.

Adegbayi while speaking at an investiture ceremony of 10th President of Institute of Loss Adjusters of Nigeria (ILAN) noted that out of the industry 80 million customer potential, an estimation of about 55 million to 60 million are meant to be on low income leaving just about 20 million to 25 million for middle income to upper middle income to wealthy group (Estimated to be about 2-5 million).

According to her, So the core Insurable Band would at least be about 10 million, yet estimated policy sales is between 2.5 million 3 million, 25 percent to 30 percent of potential middle to upper middle income market.

She also pointed that current insurance density (Premium Per Capita) is less than $9 compared with whole of Africa at $66.

Adegbayi challenged the ILAN to rise to the challenge of engaging in activities that will ensure the general welfare and public well being of insurance Loss Adjusters and take necessary actions for the advancement of education in the field of Loss Adjusting in the country.

She said the Institute help the industry to establish CAUSE of LOSS, investigate complex or contentious claims and assess the validity of the claim and recommend appropriate payment.

 

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