Nigeria insurance marketplace trends by A.M. Best Co : Economic evolution as well as the need for issue energy infrastructure projects has been fuelled past times Nigeria’s petroleum as well as gas industry, resulting inwards the country’s insurance marketplace becoming the largest inwards West Africa, according to a novel study from A.M. Best Co.
“Africa’s Diverse Insurance Markets Offer Growth Opportunities, Untapped Demand”
In the study entitled, “Africa’s Diverse Insurance Markets Offer Growth Opportunities, Untapped Demand”, A.M. Best notes full insurance premium inwards Nigeria reached USD 1.6 billion inwards 2011, although insurance penetration is pocket-size at 0.6%. The study states the Pension Reform Act, which makes pension insurance compulsory for companies employing to a greater extent than than 5 people, is probable to displace farther increment inwards life premiums. A.M. Best considers the evolution of the life portfolio inwards Nigeria equally positive for insurers’ diversification, although management teams may ask to demonstrate their skills inwards these novel areas.
Carlos Wong-Fupuy, Senior Director, Analytics, said: “Nigeria’s non-life sector accounted for 74% of full premium inwards 2011, alongside drivers including the enforcement of compulsory lines of draw of piece of occupation organization such equally motor third-party liability, professional person indemnity, world as well as full general liability. Motor risks brand upward to a greater extent than than a quarter of non-life premium inwards Nigeria. This reflects the country’s petroleum as well as gas risks, which lawsuit inwards real volatile increment inwards gross premiums written as well as depression retentivity ratios.”
The study notes the insurance market has experienced consolidation driven primarily past times higher working capital missive of the alphabet requirements. The fiscal crisis too contributed to merger as well as acquisition activity, equally the Central Bank of Nigeria passed a directive ordering all deposit coin banks to divest their non-banking interests or degree a belongings fellowship structure. However, the study states Nigeria’s insurance market remains crowded.
Source: Business Wire