Insurance In Nigeria Contributed Only $1bn To GDP In Contrast To South Africa’s $50bn In 2020

National Insurance Corporation of Nigeria

Reflecting on the contribution of insurance to the Nigerian economy, stakeholders contrasted the $1 billion contributions made to the GDP in Nigeria by insurance firms to the $50 billion made by South African insurance companies to the South African GDP.

Despite the $100 billion potential of Nigerian insurance companies, firms still fall short of hitting that figure, with experts in the field noting that insurance could become one of Nigeria’s biggest sources of internally-generated revenue (IGR) if done well.

This was disclosed in a webinar with the theme ‘Why Insurance is Important for the Growth of Nigeria’s Digital Economy’.

Present at the webinar were: the CEO of Thrive Agric., Adia Sowho; CEO of VerifyMe Nigeria, Esigie Aguele; Chief Digital Officer of AXA Mansard, Bayo Adesanya; and Thrive Agric’s co-founder Tunji Andrews, who facilitated the event.

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Describing the current state of insurance in Nigeria, Aguele said, “For a population of 200 million people, we only contributed $1 billion to Gross Domestic Product (GDP) last year. South Africa, which has a third of Nigeria’s population, has a penetration of 17 percent and a GDP contribution of $50 billion. Stakeholders must put in efforts to ensure that insurance is available to more people to grow the digital economy.

“For a company like VerifyMe, we have the technology and APIs, but there needs to be strong regulation to close the credibility gap in the insurance market and drive compliance, even with the one per cent who are insured. For instance, we need regulation to ensure that the right ID is matched to the right product. For vehicle insurance, we have to ensure that all motorists have proper insurance and driver’s licenses.

“This will expedite the adoption of data-as-a-product solutions that use ticketing scores to set insurance premiums. These are some of the mandatory regulations that can be put in place while we continue to work on the economic issues that will change cultural perceptions to grow the market much bigger.”

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