33.2 C
Saturday, April 1, 2023

Oil and Gas Premium Income Improves on Local Content Act 

Must read

- Advertisement -
- Advertisement -

The Oil and Gas premium of the largest insurers in Africa’s largest economy has improved significantly on the back of the Local Content Act of 2010.

Data gathered by MoneyCentral shows the six largest general insurance companies collectively grew Oil and Gas premium income by 11.20 percent to N14.60 billion in 2020.

Analysts at Afrinvest Securities expect this uptrend to continue, but they added that it is positive for this sub-group compared with peers globally, where death toll has significantly resulted in huge claims payout.

“Weak retention capacity of the Nigerian insurers would see more premiums ceded to reinsurers both home and abroad,” said analysts at Afrinvest Securities.

Section 49 of the Nigerian Content Act specifically stated that all operators, alliance partners and Nigerian indigenous engaged in any form of business, operations, or contract in the Nigerian oil and gas industry shall insure all insurable risks related to its oil and gas business, operations or contract within and through an insurance broker or brokerage firm or an insurer registered in Nigeria under the provision of Insurance Act 2003.

Mutual Benefit Plc realized N1.92 billion from oil and gas premium in 2020, according to a breakdown of revenue figures in the balance sheet.

NEM Insurance’s premium income from oil and gas business was up 21.91 percent to N3.56 billion in December 2020 from N2.92 billion the previous year.

The top 17 publicly listed Nigerian insurance companies reported aggregate revenue of N175.10 billion in the first six months of 2021, a year on year increase of about 21.85 percent, according to data gathered by MoneyCentral.

11 firms reported an uptick in revenue and the most notably were Custodian Investment, AIICO Insurance, AXA Mansard, Mutual Benefit, Cornerstone, Lasaco, Prestige Assurance, and Linkage.

Most of the composite ones were able to magnify both life and non-life premium income and there was an improvement in third party vehicle business.

AIICO Insurance saw an 18.44 percent increase in gross premium income to N34.43 billion as at June 2021, while the Life segment, which makes up 71.50 percent of gross premium income, grew by 9.32 percent to N24.62 billion as at June 2021. Life segment was up 52.81 percent to N9.49 billion in the period under review from N6.21 billion the previous year.

Custodian Investment’s gross premium income grew by 22.18 percent to N32.93 billion as at June 2021, and revenue at the Life segment was up spiked by 40.28 percent to N16.85 billion as at June 2021 while Non-Life segment rose by 7.90 percent to N16.25 billion in the period under review from N15.06 billion the previous year.

AXA Mansard’s gross premium income was up 14.03 percent to N25.92 billion as at June 2021 while the Non-Life segment’s revenue was up 33.13 percent to N17.80 billion while Life business rose by 4.31 percent to N5.32 billion.

Mutual Benefit Assurance’s gross premium income spiked by 43.40 percent to N13.50 billion as at June 2021 while Non-Life segment was up 83.05 percent to N9.61 billion as at June 2021. Life business grew by 16.93 percent to N5.72 billion as at June 2021.

- Advertisement -
- Advertisement -

More articles


Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.

- Advertisement -

Latest article