Seven listed Nigerian insurance firms reported a 45 percent rise in their net assets base in 2024 indicating that the company has sufficient assets to cover liabilities, reducing the risk of insolvency.
This growth signals long-term sustainability, attracting investors looking for capital appreciation.
According to BusinessDay’s findings, AIICO Insurance, AXA Mansard Insurance, Cornerstone Insurance, NEM Insurance, Coronation Insurance, Linkage Assurance, and Consolidated Hallmark Holdings recorded an aggregate net asset value of N343.3 billion in 2024, a 45.2 percent increase from N236.4 billion in 2023.
AIICO Insurance tops the list with a net asset of N64.7 billion, followed closely by NEM Insurance with N59.8 billion, and AXA Mansard Insurance with N52.7 billion.
The rise in net assets reflects the insurance firms’ enhanced capacity to settle claims and expand their operations. Analysts note that a robust capital base is crucial in instilling confidence among policyholders and investors alike.
“The increase in net assets is a clear indicator that Nigerian insurance firms are on a path to sustainable growth,” Abiodun Adebayo, a financial analyst said. “With regulatory backing and corporate governance improvements, we expect more foreign and institutional investors to take an interest in the sector.”
Adebayo Olaniyi, a financial analyst in an insurance firm described the increase as a testament to the sector’s improved financial health.
“The rise in net assets indicates that insurance companies are strengthening their capital base. This, in turn, builds trust among investors and policyholders, ensuring stability in the industry,” Olaniyi stated.
For an insurance firm, net asset, which is also referred to as shareholders fund or book value represents the value of a company or entity’s assets after deducting all its liabilities, essentially reflecting its overall worth or equity.
The increase in net assets is expected to attract more investors, particularly foreign direct investment (FDI), into Nigeria’s insurance space. With a stronger financial standing, firms are positioned to expand their service offerings, underwrite larger risks, and enhance policyholder benefits.
In 2024, the NGX Insurance Share Index was among the top-performing sectors in the stock market, delivering strong returns for investors.
Insurance stocks surged from N391.38 in January to N718 by December 28, reflecting increased investor interest and driving up share prices.
However, this year, profit-taking has weighed on the stock market, leading to a decline in insurance shares from N710.08 in January to N689.68. This downturn has not been limited to the insurance sector, as banking, consumer goods, and other industries are also experiencing lower returns on their share prices.
Read also: Access Holdings, Universal Insurance top most actively traded stocks
Looking at last year’s performance, insurance firms cashed out as a BusinessDay survey of the seven firms collectively reported a double of their profit amounting to N104.8 billion in their after-tax profit compared to N58.6 billion reported in 2023.
The growth aligns with the National Insurance Commission’s (NAICOM) ongoing efforts to deepen insurance penetration in Nigeria. Recent regulatory policies aimed at recapitalisation and market expansion have played a crucial role in boosting insurers’ financial health.
According to a BusinessDay report, Insurance companies in Nigeria may be facing a new minimum capital requirement of over 650 percent if the insurance bill scales through at the National Assembly.
The new bill entitled, ‘Nigeria Insurance Industry Reform Bill 2024,’ which has scaled the second reading at the floor of the Senate, seeks to increase the minimum capital requirement of life insurance companies from the current N2 billion to N15 billion, and general business from N3 billion to N25 billion. Reinsurance business’ capital will move from N10 billion to N45 billion, according to the proposed bill seen by BusinessDay.
Analysis of individual firms
AIICO Insurance Plc
AIICO is a non-banking financial services provider for health, Life, motor, travel, health insurance, and investment needs.
At the end of 2024, the insurer’s net assets value grew to N64.7 billion from N51.9 billion, while total liabilities rose to N343.2 billion from N266.3 billion.
Retained earnings rose to N25.6 billion from N16.7 billion while after-tax profit grew to N14.9 billion from N13.8 billion.
AXA Mansard Insurance Plc
AXA Mansard’s net assets value grew to N52.7 billion from N41.4 billion, while total liabilities increased to N132.5 billion from N99.7 billion.
At the end of 2024, its retained earnings rose to N34.1 billion from N14.4 billion and after-tax profit grew to N14.3 billion from N10.9 billion.
Cornerstone Insurance Plc
Cornerstone Insurance offers motor vehicle insurance, travel insurance, aviation, marine, engineering, and assets, among others.
At the end of 2024, its net assets value grew to N54 billion from N34 billion, while total liabilities increased to N60.5 billion from N48.6 billion.
Retained earnings rose to N29.8 billion from N14.1 billion and after-tax profit grew to N23.4 billion from N15.4 billion.
Read also: Insurance brokers move to enhance value, exploit opportunities in AfCFTA
NEM Insurance Plc
NEM Insurance’s net assets value grew to N110.2 billion from N74.2 billion, while total liabilities increased to N50.5 billion from N35.6 billion.
NEM Insurance Plc is a Nigeria-based general insurance company engaged in providing non-life insurance services for corporate and individual customers.
The Company’s segments include General Accident, Fire, Marine, Motor, Oil and Gas, and Agriculture. The Company’s products include corporate, personal, and small and medium-sized enterprises (SMEs) products.
At the end of 2024, retained earnings rose to N37.4 billion from N21.8 billion while after-tax profit rose to N9.8 billion from N8 billion.
Coronation Insurance Plc
Coronation Insurance Plc is an insurance company in Nigeria licensed to underwrite all classes of life and non-life insurance for the personal, group, commercial and industrial sectors.
Net assets at the end of 2024 rose to N78.6 billion from N48 billion while total liabilities grew to N39.8 billion from N23.7 billion in 2023.
Retained earnings grew to N10.2 billion from a loss of N1.7 billion while its after-tax profit rose to 9.9 billion from N1.8 billion.
Linkage Assurance
Linkage Assurance saw its net total assets grow to N59.1 billion from N52.8 billion, while total liabilities increased to N21.8 billion from N19.8 billion.
Linkage Assurance provides insurance services, offering individual and group life insurance products and non-life insurance products such as motor and casualty insurance.
At the end of 2024, retained earnings grew to N4.1 billion from N1.5 billion while after-tax profit was N9.4 billion.
Consolidated Hallmark Holdings
Consolidated Hallmark Holdings Plc is the parent holding company of Consolidated Hallmark Insurance which is a general insurance company in Nigeria offering products for automotive, travel, fire, marine, home, personal, bonds, and special risk cover.
The company has taken a leadership role in the underwriting of key transactions in the aviation, oil and gas, marine cargo, and motor sectors.
At the end of 2024, its net assets grew to N56.3 billion from N26.2 billion while total liabilities rose to N20.5 billion from N13.3 billion.
Retained earnings grew to N21.6 billion from N3.4 billion while after-tax profit rose to N23.1 billion from N3.8 billion.
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