By Favour Pius
Nigeria’s insurance industry is showing renewed strength despite economic headwinds; with total assets climbing to N4.78 trillion in the fourth quarter of 2025, even as operators warn that deep-rooted structural challenges continue to limit the sector’s full potential.
Data released by the National Insurance Commission (NAICOM) indicate that the industry recorded a 7.4 per cent quarter-on-quarter increase from N4.46 trillion, driven largely by oil and gas underwriting in the non-life segment and sustained growth in annuity funds within life business.
The figures, which come at a time of high inflation, foreign exchange volatility and weak consumer purchasing power, reinforce the sector’s resilience, but also expose widening imbalances in market structure and penetration.
Non-life business accounted for N2.60 trillion of the total assets, while life insurance contributed N2.19 trillion, reflecting a near-even split in the industry’s asset base.
The Chairman of the Nigerian Insurers Association (NIA), Kunle Ahmed, said the asset growth reflects improved underwriting discipline and stronger investment strategies by operators, but stressed that the industry must move beyond balance sheet expansion to achieve real impact.
Ahmed noted that while the sector has demonstrated resilience, low penetration remains a major concern, urging stakeholders to prioritise retail market expansion, enforcement of compulsory insurance and public awareness.
“The growth we are seeing is encouraging, but it is not enough to deepen insurance inclusion. The industry must intensify efforts to build trust, innovate around products and reach underserved segments of the economy,” he said.
Operators say the growth trajectory underscores improved balance sheet strength and investment performance, but caution that it is yet to translate into broad-based inclusion or significant impact on the real economy.
NAICOM, in its report, maintained that the sector has remained stable across key performance indicators, including premium generation, claims settlement and profitability, describing the industry as a critical component of Nigeria’s ambition to build a $1 trillion economy.
However, a closer look at the market reveals significant concentration, particularly in the life segment, where the top three underwriters control about 55 per cent of premiums, while the top 10 firms account for nearly 90 per cent of the market.
In contrast, the non-life segment appears more competitive, with the top three players holding 33.3 per cent and the leading 10 accounting for 66.6 per cent of premiums.
Less than one per cent of total premiums is generated by the bottom 10 operators across both segments, highlighting ongoing operational inefficiencies and regulatory pressures confronting smaller firms.
Analysts warn that while concentration is not yet at systemic risk levels, it could stifle innovation and limit market expansion if weaker players continue to struggle.
On the revenue front, the industry posted strong growth in gross premiums, which rose to N2.3 trillion in the period under review, representing a 36 per cent increase quarter-on-quarter and 47.3 per cent year-on-year.
The life segment generated N727.4 billion, with annuity business contributing 44.3 per cent, reflecting rising demand for retirement-focused financial products amid economic uncertainty.
In non-life business, oil and gas remained the dominant driver, contributing N476.6 billion or 30.3 per cent of premiums, followed by fire insurance at N321.1 billion and motor insurance at N252.8 billion.
Stakeholders say the dominance of oil and gas underscores the industry’s continued reliance on corporate risks, with limited diversification into retail and microinsurance segments.
Ahmed added that unlocking the sector’s full potential would require sustained regulatory support, improved enforcement and strategic collaboration among operators.
As regulators push for deeper reforms, including recapitalisation and market discipline, operators insist that sustained growth will depend on improving consumer confidence, strengthening distribution channels and aligning products with the realities of Nigeria’s largely informal economy.
For now, the latest figures present a picture of an industry that is financially stronger, but still grappling with the fundamental challenge of relevance in a rapidly evolving economic landscape.
