Non-Life Insurance companies were able to generate N39.2 billion gross premium income from the Motor insurance business they respectively wrote in their 2017 financial year.
These underwriters were able to recoup the income from the sale of Comprehensive Motor Insurance and Third Party Motor Insurance policies to about 3 million vehicles with valid insurance certificates across the country.
The N39.2 billion translates to about 12 per cent of the N365 billion premium income the insurance industry declared in their most recent financial year (2017).
Having ceded N2.5 billion for Reinsurance, insurance operators are now left with N36.6 billion Net Written Premium.
A data sourced from the Nigerian Insurers Association (NIA) shows that NEM Insurance PLC is the leader in this business, recording a gross premium income of N4.4 billion, followed by AXA Mansard Insurance PLC with a N3.08 billion while Leadway Assurance Company Limited came third with N3.07 billion gross premium income.
Mutual Benefits Assurance Plc came forth, having generated N2.7 billion from this business line, followed by Custodian and Allied Insurance LTD with N2.4 billion as gross premium, even as AIICO Insurance Plc came sixth recording N1.9 billion from Motor insurance business.
Cornerstone Insurance Plc came seventh with N1.74 billion, followed by Royal Exchange General Insurance Company Ltd with N1.64 billion income from this business while in the ninth position is Zenith Insurance Company Limited who recorded N1.56 billion gross premium income, followed by Staco Insurance Plc with N1.50 billion income even as Sovereign Trust Insurance Plc recorded N1.3 billion premium income from this class of business to occupy the 11th position.
While the industry was able to gain N39.2 billion from this class of insurance business, LEADERSHIP had earlier reported that insurance sector is losing about N46 billion expected premium income from non-insurance of 9.2 million vehicles on roads across the country.
According to the Nigerian Bureau of Statistics(NBS) report, estimated vehicle population in Nigeria as at the end of second quarter of 2018 was put at 11.7 million,
Of this number, it was learnt that only 2.5 million of them have valid and active motor insurance policy, thereby, leaving a whopping 9.2 million vehicles uninsured.
These uninsured vehicles, LEADERSHIP findings show, are either carrying fake insurance certificates or failed to renew their expired policy, hence, violating the Federal Roads Safety Corp(FRSC) Act which mandates all vehicles on Nigerian roads to carry at least third party motor insurance policy.
Third Party Vehicle Insurance comes at a fixed price of N5, 000 for privately used saloons and SUVs, while commercially used vehicles are charged N7, 500 and in some cases, N5,000. The law stipulates 10 per cent of the value of a vehicle as a premium for comprehensive Motor insurance coverage, but the industry is currently selling it for between 2.5 to 5 per cent of the cost of a vehicle.
To this end, insurance industry is losing about N46 billion to non-insurance of these vehicles.
The director Of Operations, NIA, Mr. Lanre Ojuola, said, the number of active Motor insurance policies registered on the Nigerian Insurance Industry Database(NIID) now stood at 2.5 million , even though, the total registered motor policies on the platform is over three million.
Section 38 of the National Insurance Act 2003, currently in use, states that 3rd Party Motor Insurance is required as part of the minimum amount of auto cover one must carry as a road user. Penalties for non-compliance can include a fine of up to N250,000 and/or one-year imprisonment
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