There are indications that the insurance sector has shaken off the impact of COVID-19 on its performance recording 15.7 percent Year-on-Year, YoY, growth in contribution to gross domestic product, GDP, in the second quarter of 2021, Q2’21.

The industry’s revenue has recorded significant uptick YoY in the first half of the year, H1’21, as Vanguard’s findings from the financial performance of 17 insurance companies recently submitted to the Nigerian Exchange Group show a 23.2 per cent rise in Gross Premium Written, GPW, to N217.3 billion H1’21, from N176.4 billion in the corresponding period of 2020.

Profit after tax declined by 5.1 per cent to N16.8 billion in H1’21 from N17.7 billion recorded in the corresponding period of 2020.

Vanguard findings from the National Bureau of Statistics, NBS, indicated that the industry emerged from a sector GDP contraction of -4.58 per cent in the first quarter of 2021, Q1’21, while it grew by 15.68 per cent in Q2’21, as against a huge plunge of -29.53 per cent recorded in Q2’20, in the midst of COVID-19 lockdowns and other accompanying macro-economic headwinds.

An NBS analysis of the sector had stated: “Insurance under Financial and Insurance Sector grew by 15.68 per cent in Q2’2021 from -4.58 per cent in Q1’2021 and 29.53% in Q2 2020.

“The Finance and Insurance Sector consists of the two subsectors, Financial Institutions and Insurance, which accounted for 87.92% and 12.08% of the sector respectively in real terms in Q2 2021. As a whole the financial and insurance services sector grew at -1.86 per cent in nominal terms (year on year), with financial institutions growing at -3.93 per cent while insurance recorded a growth rate of 16.41%.

“The overall rate was lower than that in Q2 2020 by –22.68 per cent points and by -4.01 per cent points than the preceding quarter.

“Quarter-on-quarter growth was -3.45 per cent. The sector’s contribution to the aggregate nominal GDP was 3.21 per cent in Q2’2021, lower than the 3.76 per cent it represented a year earlier, and the contribution of 3.25 per cent it made in the preceding quarter.

“Growth in this sector in real terms totaled –2.48 per cent, lower by –20.97 per cent points from the rate recorded in the second quarter of 2020 and -2.02 per cent points from the rate recorded in the preceding quarter.

“For the first half of 2021, growth in financial and insurance services stood at -1.47 per cent year on year, compared to 19.63 per cent year on year for 2020.”

Speaking on the industry performance, Managing Director of FBN Insurance Brokers, Mr. Olumide Ibidapo, said that it has been a fair performance considering the challenging economic environment.

He stated: “If you look at Q1 of the 2021, the industry witnessed a contraction of more than four per cent. In Q2 2021, we are now having a growth of more than 15 per cent which to me is a good performance even though 2020 was a lockdown year. So any major performance in 2021 will reflect this positive growth. So looking at the industry as a whole, it has been a fair performance considering the challenging economic environment that we are operating in.”

On the outlook for the remaining part of the year, Ibidapo said: “It has been a tough journey most especially looking at the event of 2020 and the outcome of the EndSARS crisis and lockdown of the economy. Insurance-wise, majority of the claims lodged following the EndSARS event are being settled to a greater extent and billions of naira have been settled in claims by the insurance industry. The outlook is looking good. Second half of the year will be positive.”