Kayode Tokede
Listed insurance companies on the Nigerian Exchange Limited (NGX) delivered a mixed performance in the first quarter of 2026 as industry-wide insurance revenue declined by 9.9 per cent, even as stronger investment income, improved efficiency and prudent cost management helped boost profitability.
An analysis of the unaudited results of 13 quoted insurance firms showed that aggregate insurance revenue fell to N228.07 billion in the first three months of 2026 from N253.01 billion recorded in the corresponding period of 2025.
The development highlights the persistent challenge of low insurance penetration in Africa’s largest economy, despite ongoing reforms aimed at deepening market participation, strengthening operators and expanding the industry’s contribution to economic growth.
The companies reviewed include: NEM Insurance Plc, AIICO Insurance Plc, AXA Mansard Insurance Plc, Consolidated Hallmark Holdings Plc, International Energy Insurance Plc, Lasaco Assurance Plc, Prestige Assurance Plc, Sovereign Trust Insurance Plc, and other listed underwriters.
A breakdown of the results revealed that several operators witnessed significant declines in insurance revenue during the period under review.
Among the most affected was Consolidated Hallmark Holdings Plc, which reported one of the sharpest contractions in premium income. The company posted insurance revenue of N11.69 billion in the first quarter of 2026, representing a decline of nearly 73 per cent from N43.30 billion reported in the corresponding period of 2025.
International Energy Insurance Plc also recorded a steep decline, with insurance revenue dropping by almost 61 per cent to N615.78 million from N1.56 billion a year earlier.
Similarly, NEM Insurance Plc, one of the industry’s leading players, reported insurance revenue of N37.24 billion, down about 19 per cent from N46.06 billion recorded in the first quarter of 2025.
Lasaco Assurance, Prestige Assurance and Sovereign Trust Insurance also posted declines in insurance revenue, reflecting the challenging operating environment and intense competition within the sector.
Despite the pressure on top-line earnings, many insurers demonstrated resilience through improved operational efficiency and disciplined cost management.
Consolidated Hallmark Holdings emerged as one of the strongest performers in terms of profitability. The company grew profit before tax by an impressive 159.4 per cent to N21.1 billion, compared with N8.15 billion in the corresponding period of last year.
The remarkable performance enabled the company to account for more than 37 per cent of the sector’s combined profit before tax during the quarter.
Overall, the 13 listed insurers generated N56.8 billion in profit before tax in the first quarter of 2026, representing nearly 14 percent growth over N49.99 billion reported in the corresponding period of 2025.
The improvement in earnings underscores the ability of many operators to navigate revenue pressures through stronger investment returns, improved underwriting discipline and tighter expense management.
Beyond Consolidated Hallmark Holdings, Linkage Assurance Plc delivered one of the most impressive earnings performances in the sector.
The company reported profit before tax of N6.6 billion, representing a remarkable 689 percent increase from N833.2 million reported in the corresponding period of 2025.
While several insurers struggled with revenue growth, several operators recorded encouraging increases in premium income.
Coronation Insurance Plc increased insurance revenue by 32.7 per cent to N20.9 billion from N15.8 billion recorded a year earlier.
AIICO Insurance Plc sustained its growth trajectory, posting insurance revenue of N36.67 billion, representing an increase of nearly 12 per cent from N32.81 billion reported in the first quarter of 2025.
AXA Mansard Insurance Plc also maintained strong momentum, growing insurance revenue by 20.1 per cent to N48.5 billion from N40.33 billion in the corresponding period of the previous year.
Industry analysts noted that the mixed performance reflects an insurance sector in transition as operators adjust to changing market dynamics, regulatory reforms, and evolving customer expectations.
The sector’s performance comes against the backdrop of broader growth in Nigeria’s financial services industry.
Data released by the National Bureau of Statistics (NBS) showed that the financial institutions sub-sector remained one of the strongest contributors to economic activity in the first quarter of 2026.
According to the NBS, the sector contributed N1.75 trillion to Gross Domestic Product (GDP) during the period, compared with N1.61 trillion in the corresponding quarter of 2025, representing growth of approximately 8.4 per cent.
The insurance sub-sector also maintained a positive growth trajectory, contributing N180.95 billion to GDP, up from N164.58 billion recorded in the first quarter of 2025.
The increase of about 9.9 per cent reflects gradual improvements in underwriting activities, premium generation and market expansion efforts across the industry.
Market analysts believe the insurance industry is entering a potentially transformative phase as regulatory reforms gather momentum.
Particular attention is focused on the ongoing recapitalization program, which is expected to reshape the industry’s competitive structure and accelerate consolidation among operators.
Analysts at CardinalStone said the reforms could fundamentally alter the industry’s landscape, especially for smaller firms struggling with capital adequacy requirements.
According to the investment house, the recapitalization directive is likely to increase pressure on relatively small operators in an already fragmented market.
The firm noted that mergers and acquisitions may become more prevalent as undercapitalised insurers seek strategic partnerships to meet new regulatory thresholds.
CardinalStone added that insurers would be required to comply with the revised capital requirements within 12 months of the legislation’s implementation. However, further guidance from regulators is expected on qualifying capital, implementation timelines, and transitional arrangements.
For investors, the sector remains increasingly attractive as reforms, stronger governance standards, and improved capitalization lay the foundation for a more resilient and competitive insurance industry.
While low market penetration continues to constrain premium growth, analysts believe the combination of regulatory reforms, consolidation opportunities and growing awareness of insurance products could unlock substantial long-term value in the sector.
