Nigeria plans to take the worth of its insurance industry from $2.2bn to more than $6.7bn by 2017 by improving the reputation of the industry, says Insurance Commissioner, Fola Daniel.
“Our people don’t trust insurance. We’ve done a lot of housekeeping to make sure companies respect the rules,” he said in an interview in Dubai.
The value of insurance contracts should rise to about $6.4bn or N1trillion in 2017, roughly 3 per cent of the Gross Domestic Product (GDP). Presently, it is less than 1 per cent of the GDP, he said. He also expects that penetration should increase to 22.5 per cent of the insurable population in four years from its present level of 10 per cent.
Compulsory motor-vehicle insurance, which make up the bulk of contracts at present, is expected to remain at 10 per cent in 2017 , while life insurance is expected to take up 7 per cent of the market. General business insurance and petroleum companies’ insurance would take up 3 per cent and 2.5 per cent respectively, he said.
Oil and gas companies are still insured by foreign insurers as the capacity of local insurers is limited, Fola said.
Nigeria is Africa’s largest oil producer with 1.9million barrels per day. It is also its most populous country.
The Bloomberg Nigerian Stock Exchange insurance index, a measure of the 10 most liquid insurers on the Lagos-based exchange, has appreciated by 11 per cent this year, which is faster than the All-Share index at 5.8 per cent. Continental Reinsurance Plc and Aiico Insurance Plc were up 4.9 per cent and 3.9 per cent respectively today.