Insurance Sector Grew by 6.07% in Q2 –NBS

• Insurance Sector Grew by 6.07% in Q2 –NBS

The insurance industry, which accounts for 16.02 per cent of the financial sector, grew by 6.07 per cent in the second quarter of 2018 financial period, according to figures from the National Bureau of Statistics.

The NBS said, “The finance and insurance sector consists of two sub-sectors, the financial institutions and insurance, which account for 83.98 per cent and 16.02 per cent of the sector respectively in real terms in Q2 2018.

“As a whole, the sector grew at 3.49 per cent in nominal terms (year on year), with the growth rate of financial institutions as 3.01 per cent and 6.07 per cent growth rate recorded for insurance. The overall rate was lower than that in Q2 2017 by –14.19 per cent points, and lower by -10.34 per cent points than the preceding quarter.

“Quarter-on-quarter growth was –1.94 per cent. The sector’s contribution to the overall nominal GDP was 3.42 per cent in Q2 2018, lower than the 3.75 per cent in the previous year and lower from the contribution of 3.76 per cent it made in the preceding quarter by -0.33 per cent points and -0.34 per cent points respectively.”

Again driven by the financial institutions activity, the growth of the sector in real terms totalled 1.28 per cent, lower by –9.18 per cent points from the rate recorded in 2017 second quarter and down by –12.03 per cent points from the rate recorded in the preceding quarter.

The NBS stated, “Quarter-on-quarter growth in real terms stood at –3.80 per cent. The contribution of finance and insurance to real GDP totalled 3.31 per cent, lower slightly than the contribution of 3.32 per cent recorded in the second quarter of 2017, and lower than 3.55 per cent recorded in the preceding quarter.”

The NBS revealed that the nation’s Gross Domestic Product growth rate for the second quarter of this year declined from 1.95 per cent in the first quarter to 1.5 per cent.

Commenting on the slow pace of the country’s GDP performance in the second quarter of the year, the President, Chartered Insurance Institute of Nigeria, Mr Richard Borokini, said with the drop in the second quarter, the projection set for the end of the year might not be realised.

He said since election period was approaching, investors were taking their time to watch the political development “because whatever happens politically will also affect the economy.

He added, “Hopefully, if the right direction is achieved politically, things would improve. The trend may not significantly change as we progress to the end of the year.”