Insurers pay N347bn claims despite N10.9bn premium decline

By Rosemary Iwunze

Claims paid by insurance companies  rose by 0.1 per cent, year-on-year, YoY  to N346.87 billion in the first half of 2026, H1’26, from N346.59 billion in the corresponding period of 2025.

The rise in claims payment was in spite of a 1.8 per cent YoY decline in Gross Premium Written, GPW, raising concerns over pressure on underwriting margins in the industry.

Analysis of the H1’26 financial statements of 18 insurance companies listed on the Nigerian Exchange Limited, NGX, showed that aggregate GPW fell to N579.25 billion, from N590.2 billion  in the corresponding period of 2025.

The companies are AIICO Insurance,  Axa Mansard,   Consolidated Hallmark Insurance, Cornerstone Insurance, Coronation  Insurance, Custodian Investment, Guinea Insurance, International Energy Insurance,  Lasaco Assurance, Linkage Assurance, Mutual Benefits, Nem Insurance,  Prestige Insurance,  Regency Assurance,  Sovereign Trust Insurance, SUNU Assurances, Universal, as well as Veritas Kapital Assurance.                        

Experts are of the opinion that the figures indicate that while insurers generated less premium income during the period under review, their claims obligations continued to rise, albeit marginally.

Speaking on the development, Managing Director of Boof Insurance Brokers, Mr. Olumide Fatogun stated that the figures also suggest that a larger proportion of premium income was absorbed by claims during the period.  Although the increase in the claims-to-premium ratio appears marginal, it could become significant for insurers if claims continue to grow while premium income remains subdued.

He said: “There is a need for insurers to sustain premium growth while maintaining disciplined underwriting and claims management. This becomes particularly important as the industry moves into the post-recapitalisation era, with stronger capital requirements expected to translate into greater capacity to underwrite risks and improve policyholders’ confidence in insurance.”

According to NAICOM, about N1.079 trillion has been mobilised through the recapitalisation exercise, comprising fresh capital and existing funds that strengthened the financial position of operators.

But as the industry enters the post-recapitalisation era, questions are increasingly being raised about whether the new capital will translate into better underwriting capacity, faster claims settlement, greater domestic retention of risks and, ultimately, wider insurance coverage.