Nigeria’s insurance industry appears to be experiencing its strongest growth phase in years. Premium income is rising, insurers are reporting stronger balance sheets, and the sector is becoming increasingly attractive to investors.
But beneath the impressive financial figures lies a persistent challenge: insurance penetration remains below one percent, raising questions about whether the industry’s growth is translating into broader financial protection for ordinary Nigerians.
According to data from the National Insurance Commission (NAICOM), Nigeria’s insurance industry recorded Gross Premium Written (GPW) of N2.301 billion in the fourth quarter of 2025, the highest quarterly performance recorded by the sector.
The growth was largely driven by the non-life insurance segment, which accounted for 68.4 percent of the total premium market. Within the segment, oil and gas insurance remained the largest contributor, accounting for 30.3 percent of non-life premiums, followed by fire insurance at 20.4 percent and motor insurance at 16.1 percent.
The industry’s expanding financial strength was further highlighted at the Nigerian Insurers Association’s 55th Annual General Meeting, where Kunle Ahmed, immediate past chairman of the association, disclosed that the sector’s Gross Premium Income surpassed N2.3 trillion in 2025.
He also revealed that total industry assets increased by 7.4 percent to N4.8 trillion from N4.5 trillion recorded in 2024.
The positive momentum has continued into 2026, with several insurance companies recording higher insurance revenue during the first quarter.
AXA Mansard Insurance reported insurance revenue of N48.46 billion in Q1 2026, compared with N40.33 billion in the same period of 2025. AIICO Insurance recorded N36.67 billion, up from N32.81 billion, while Coronation Insurance increased its insurance revenue to N20.92 billion from N15.76 billion during the same period.
Other insurers, including NEM Insurance, Cornerstone Insurance and Mutual Benefits Assurance, have also reported growth.
However, industry analysts argue that the increase in premium income and profitability does not necessarily mean insurance has become deeply embedded in the daily lives of Nigerians.
For Chima Nwachukwu, author, founder and convener of the ABSF Insurance Storytellers Conference and Film Showcase, the industry’s recent revenue expansion has largely been driven by regulatory enforcement rather than widespread voluntary adoption.
“Much of the recent revenue growth has been driven by regulatory enforcement rather than by widespread voluntary adoption,” Nwachukwu told Business A.M.
He explained that compulsory insurance categories, including Motor Third Party Insurance, Group Life Insurance, Builders’ Liability and other statutory covers, continue to contribute significantly to industry earnings because many individuals and organisations purchase them due to legal requirements rather than a personal appreciation of insurance value.
According to him, improved regulatory monitoring by NAICOM, particularly in ensuring compliance among Ministries, Departments and Agencies (MDAs), has strengthened premium collection and reduced revenue leakages.
“Improved monitoring has ensured that insurance premiums due to underwriters are increasingly remitted, reducing leakages that existed in previous years. This has positively impacted industry revenues. However, improved collection from existing institutional customers should not be mistaken for broader insurance inclusion,” he said.
Beyond regulation, Nwachukwu noted that Nigeria’s local content policies have also contributed significantly to the industry’s growth by enabling local insurers to participate in larger risks within sectors such as oil and gas, aviation and infrastructure.
While describing this as a major achievement, he cautioned that corporate insurance growth alone cannot close Nigeria’s protection gap.
“Premium volume and insurance penetration are not the same thing,” he said, while also noting that regulation has expanded premium income. It has not yet expanded public conviction.
The trust challenge
Despite the industry’s financial progress, Nwachukwu believes the biggest challenge remains convincing Nigerians that insurance is a valuable financial tool rather than simply a compulsory expense.
“While insurance companies are growing stronger financially, insurance itself has not yet become part of the everyday culture of Nigerians,” he said.
He pointed to Nigeria’s large informal economy as evidence of the disconnect between industry growth and public participation.
“These are the people who power Nigeria’s economy every day, yet they remain largely outside the insurance ecosystem,” he noted.
For millions of traders, farmers, artisans and small business owners, insurance remains unfamiliar or is often viewed with suspicion because of concerns around claims settlement, affordability and a lack of understanding of how insurance products work.
Although NAICOM and other industry stakeholders have continued to introduce initiatives aimed at improving awareness and educating Nigerians about insurance, experts believe the sector must adopt new strategies to build confidence among potential customers.
According to Nwachukwu, one of the most effective ways to change public perception is through storytelling.
“People buy according to what they believe. And beliefs are shaped by stories. This is where I believe the next chapter of Nigeria’s insurance journey must begin,” he said.
He argued that real-life examples of insurance impact could help reshape how Nigerians perceive the industry.
“A paid claim is a story, ” Nwachukwu said, adding “ A farmer whose harvest was restored after disaster is a story. A widow whose children remained in school because life insurance fulfilled its promise is a story. An entrepreneur whose business reopened after fire is a story. Statistics inform. Stories transform.”
Digital platforms as the next frontier
Beyond changing public perception, Nwachukwu said technology provides another opportunity for insurers to expand access.
He noted that millions of Nigerians already interact daily with digital financial platforms, including mobile banking applications, fintech services, agency banking networks and telecommunications platforms.
According to him, insurance must become integrated into these existing ecosystems through embedded insurance models.
“Insurance should no longer wait behind office desks. It should travel wherever Nigerians transact,” he said.
He explained that integrating insurance into banking, mobile payments, e-commerce, agriculture, healthcare and telecommunications services could reduce distribution costs and make insurance products easier to access.
However, he warned that digital transformation alone cannot solve the industry’s biggest challenge.
“The greatest challenge is trust,” he said.
He stressed that insurers must prioritise trust-building because long-term industry growth depends not only on financial performance but also on public confidence.
“When Nigerians trust insurance, insurance penetration will no longer struggle to rise. And when trust becomes the industry’s strongest asset, financial performance and national inclusion will finally walk hand in hand,” he said.
Nwachukwu also called for insurance education to begin early, arguing that introducing risk management and protection concepts in schools would help future generations view insurance as naturally as savings.
