The commitment by life insurance operators to honour obligations with policyholders has witnessed a 22.36 per cent surge in gross claims payment within a period of one year. The increase, which was revealed by the Nigerian Insurers Association (NIA) in its annual report, also affected the management expenses of the operators, which surged from N23.08 billion in 2015 to 26.74 billion in 2016, representing an increase of 15.84 per cent. According to the report, a total of N126.70 billion was generated as gross premium for 2016 compared with N134.07 billion in 2015, representing a decrease of 5.50 per cent.
The gross premium includes contributions from Individual Life and Group Life premium with inclusion of various amount collected on deposit administration schemes/secured funds from 2012 to 2016. Also, management expenses include underwriting expenses, salaries, rents and others, excluding commission to agents. Within the same period, the operators steadily grew their liabilities to N476.44 billion from N341.61 billion. The details covered the period between 2014 and 2016. According to the report, the liabilities include Insurance Fund, Investment, Borrowing, Trade Payable, Share Capital, Reserves, Share Premium and other liabilities. A breakdown shows that while the liabilities peaked at N341.61 in 2014, it increased by N90 billion to N430.72 billion in 2015 before the year under review.
The report, which also revealed a 10.62 per cent increase in assets of the underwriters from N341.02 billion to N476.46 billion between 2014 and 2016, showed Insurance Funds’ liabilities increased from N129.14 billion in 2014, N208.25 billion in 2015 to N234.89 billion in 2016. Also, the Investment liabilities grew from N97.01 billion in 2014 to N101.62 billion in 2015 and N120.12 billion in 2016. Borrowing in 2014 was N1.46 billion in 2014, N2.29 billion in 2015 and N2.76 billion in 2016.
The trend continued with Trade Payable peaking at N4.37 billion in 2014, N6.02 billion in 2015 and N6.04 billion in 2016. Share Capital was N55.88 billion 2014, N61.73 billion in 2015 and N59.21 billion in 2016. While liabilities on Reserves was N9.99 billion in 2014, N12.11 billion in 2015 and N21.73 billion in 2016, that of Share Premium was N14,34 billion in 2014, N42.29 billion in 2015 and N52.65 billion in 2016. Other liabilities were put at N22.44 billion in 2014, N20.65 billion in 2015 and N22.56 billion in 2016. Besides the report on liabilities within the period, NIA’s data had also revealed that the industry operators borrowed […]