Nigeria Insurance Premiums Hit N2.3trn, Grows by 47.3%
By Patience Ikpeme
Nigeria’s insurance industry recorded strong growth and improved stability in the fourth quarter of 2025, with new figures showing a sharp rise in premium income, assets, and overall market activity.
According to the Bulletin of the Insurance Market Performance for the period, the industry closed the quarter with a gross premium written of N2.3 trillion. This represents a 36 per cent increase compared to the previous quarter and a 47.3 per cent rise when compared with the same period in 2024. The growth rate far exceeded Nigeria’s overall economic growth of 3.9 per cent, showing that the insurance sector is expanding much faster than the wider economy.
The report also showed that the total asset base of the industry rose by 7.4 per cent within the quarter to reach N4.79 trillion, an indication of stronger financial capacity among insurance firms.
A breakdown of the premium income revealed that the non-life segment continued to dominate the market, accounting for 68.4 per cent of total premiums, while the life segment contributed 31.6 per cent. Within the non-life business, oil and gas insurance remained the largest contributor, generating over N476 billion and accounting for more than 30 per cent of that segment. Fire insurance followed with over N321 billion, while motor insurance contributed about N252.8 billion.
In the life segment, annuity business stood out as the major driver, contributing 44.3 per cent of premiums. Individual life policies accounted for 36.2 per cent, while group life made up 19.5 per cent.
The report further showed that the industry retained a significant portion of its risks, with an overall retention ratio of 68.1 per cent. Life insurance operators retained as much as 94.1 per cent of their business, while non-life firms retained 60.3 per cent. However, some specialised areas such as aviation and oil and gas recorded lower retention levels, indicating continued reliance on foreign reinsurance support.
On claims, insurance companies reported total claims of N724.7 billion during the quarter, representing about 31.5 per cent of the total premiums generated. The non-life segment recorded a claims settlement rate of 75.5 per cent, while life insurance firms settled 65.5 per cent of claims. Motor insurance had the highest settlement rate at 88.5 per cent, suggesting quicker response to policyholders in that category.
Despite the generally positive performance, concerns remain about profitability among some operators. The average net loss ratio across the market stood at 43.6 per cent, with non-life insurance recording a higher ratio of 49.3 per cent compared to 31.4 per cent for life business. Notably, 14 underwriting firms reported loss ratios of 100 per cent or more, indicating that their claims costs exceeded their premium income.
The report also pointed to a high level of concentration in the life insurance segment, where the top three companies controlled 55 per cent of the market, and the top ten accounted for nearly 90 per cent. In contrast, the non-life segment showed a more even distribution, with the top three firms holding about one-third of the market. Smaller companies in both segments contributed less than one per cent of total premiums, reflecting limited market share at the lower end.
Meanwhile, earlier data from the National Insurance Commission showed that the industry had already experienced strong growth in 2024, laying the foundation for the 2025 performance.
The commission’s 2024 Annual Statistical Market Report revealed that the industry grew by 49.4 per cent during the year, with gross written premium reaching N1.56 trillion. The non-life segment remained dominant, contributing 68 per cent of total premiums, while life insurance accounted for 32 per cent.
Total industry assets rose by 31.7 per cent in 2024 to N3.96 trillion, with non-life business holding the larger share of 60.5 per cent. Life insurance accounted for the remaining 39.5 per cent.
Claims payment also increased significantly during the year, rising by 50.9 per cent to N926.1 billion. Non-life insurance made up the larger portion of claims at N635.5 billion, while life business accounted for N290.7 billion. The increase in claims has been linked to improved awareness among policyholders and stricter regulatory measures to ensure prompt settlement.
The commission also introduced several reforms aimed at improving efficiency and transparency within the industry. These include the deployment of digital tools such as Microsoft Office 365, an electronic documentation system, and enterprise resource planning platforms.
In terms of regulation, one troubled operator had its licence withdrawn, while five new companies were approved to operate, a move aimed at strengthening competition and stability. In addition, the National Assembly passed the Nigerian Insurance Industry Reform Bill, which is expected to update existing laws and support long-term growth in the sector.
Collaboration with other government agencies, especially in specialised areas like aviation, was also expanded to build local capacity and reduce dependence on foreign markets.
Further analysis of the 2024 data showed that oil and gas insurance remained the largest contributor within the non-life segment, while fire insurance recorded the fastest growth over a five-year period. In the life segment, individual policies accounted for the largest share, followed by group life and annuity products.
Overall, the Nigerian insurance industry is showing strong momentum, with rising premium income, growing assets, and improved claims activity pointing to increasing public confidence. However, issues such as uneven profitability and market concentration remain key challenges that regulators and industry players will need to address as the sector continues to expand.
