July 15, 2025 – Nigeria’s listed insurance companies are experiencing their most profitable period in over a decade, with market capitalization climbing by approximately N78 billion to N571 billion by July 11, 2025, according to data from the Nigerian Exchange (NGX). This unprecedented growth, driven by rising interest rates, regulatory enforcement, and digital innovation, signals a transformative moment for the sector. Here’s why this surge matters for Nigeria’s economy and investors, supported by recent financial achievements of key players.
- Economic Impact and Sector Resilience
The insurance sector’s total assets grew 24.9% year-on-year to N4.2 trillion in Q1 2025, up from N3.3 trillion in Q1 2024, reflecting robust financial health despite Nigeria’s economic challenges. The sector’s gross written premiums (GWP) reached N1.56 trillion (approximately $1.02 billion) in 2024, a 56% increase from 2023, outpacing many other industries in Nigeria’s fragile economy. This growth underscores the sector’s ability to thrive amid macroeconomic pressures, such as inflation and currency volatility, bolstered by high returns on fixed-income securities in a high-interest-rate environment. - Standout Performers
- AXA Mansard Plc: Leading the pack with a market capitalization of N115.2 billion, AXA Mansard’s share price hit N12.80, close to its 52-week high of N13.18, with a week-on-week market value increase of N25.47 billion. Its profit before tax soared to N73.6 billion in 2024, up from N11.3 billion five years prior, showcasing its dominance in profitability and asset size.
- NEM Insurance Plc: Ranked second with a market value of N110.36 billion, NEM’s share price reached N22, a 52-week high, gaining N20.07 billion week-on-week. Its shareholders’ equity grew to N68.94 billion in Q1 2025, with a profit after tax of N15.1 billion in 2024 and N4.4 billion in Q1 2025.
- Heirs Insurance Group (HIG): Unlisted but rapidly growing, HIG reported a 70% GWP increase to N61 billion in 2024 from N35.8 billion in 2023, with total assets rising 66% to N92.9 billion. The group paid N10.4 billion in claims, up 149% from N4.18 billion in 2023, reinforcing customer trust.
- Universal Insurance Plc: This non-life insurer achieved a GWP of N8.07 billion in Q1 2025, doubling its target, with shareholders’ funds rising to N16.4 billion from N13.25 billion in 2024. Its asset base exceeds N20 billion, reflecting strong recapitalization.
- LASACO Assurance Plc: Ranked seventh among NGX insurers, LASACO’s share price hit N3.20, driven by improved investor confidence.
- Drivers of Success
- High-Interest Rates: Nigeria’s elevated interest rate environment has boosted returns on fixed-income securities, where insurers allocate significant capital, driving profitability beyond traditional underwriting.
- Digital Innovation: Companies like Heirs Insurance are leading with AI-powered chatbots (e.g., Prince), USSD codes (*1100#), and digital experience centers, making insurance accessible and appealing to tech-savvy Nigerians. A study covering 2013–2023 found that innovation and competition are key drivers of profitability, with digital tools attracting and retaining customers.
- Regulatory Push: The Nigerian Senate’s revised capital requirements (N25 billion for non-life, N15 billion for life, N35 billion for reinsurance) have strengthened risk management and industry resilience, encouraging mergers and acquisitions among undercapitalized firms.
- Investor Confidence: The NGX insurance index gained 3.75% in a single week, contributing to a 4.26% rise in the NGX All-Share Index, with market capitalization reaching N79.803 trillion. This reflects growing investor interest in insurance stocks, which have historically been undervalued compared to banks.
- Why It Matters
- Economic Diversification: The insurance sector’s growth reduces Nigeria’s reliance on oil and banking, strengthening the broader financial services ecosystem. Despite its gains, the sector’s N571 billion market value remains a fraction of banking’s, indicating room for expansion.
- Job Creation and Financial Inclusion: Digital platforms and advocacy initiatives, like HIG’s Essay Championship for insurance literacy, are expanding access, particularly among young and underserved Nigerians.
- Challenges Ahead: The sector faces competition from banks raising fresh capital under the Central Bank of Nigeria’s recapitalization drive, which could encroach on insurance revenue streams. Additionally, no insurance firm is listed on the NGX30, signaling limited representation among Nigeria’s top companies.
- Looking Forward
The insurance sector’s performance in 2025, with a projected profit bump in Q1 FY26 due to high-margin products and operational efficiencies, suggests continued growth. However, sustaining this momentum requires addressing regulatory compliance, managing risks, and further embracing technology to compete with fintechs and banks. Posts on X highlight optimism, with @Nairametrics noting the sector’s “best run in years” and @MarketforcesA reporting the N571 billion market value milestone.
For more details, visit Nairametrics or NGX for market updates, or check the Nigerian Insurers Association for industry reports.