A.M.BestTV: Insurance Market Optimism Swells in Nigeria

OLDWICK, N.J.--()--In this final of five “First Monday” episodes for August 2015, A.M. Best Associate Director, Analytics Deniese Imoukhuede explains how fluctuating oil prices are hampering Nigeria’s insurance market amid significant growth potential given shifting demographics. Click on http://www.ambest.com/v.asp?v=fmnigeria815 to view the video program.

“First Monday” is A.M. Best’s monthly program featuring commentary by the company's leading analysts.

Fluctuating oil prices have been a drag on Nigeria’s economic expansion. This has created a difficult operating environment for the country’s insurance market. However, significant potentials still exist for insurers, since Nigeria has the largest economy in Africa, with an estimated gross domestic product of $574 billion. Additionally, oil production continues to play a heavy role in Nigeria, since more than 90% of its exports are derived from the trade of petroleum.

“Nigeria’s insurance industry has grown significantly over the past decade, boosted by economic expansion,” said Imoukhuede. “Given that the country’s economy is dependent upon commodity pricing, the current low levels of oil pricing are having and continue to have an impact on Nigeria’s economy, since the government is reliant on these oil revenues for 70% of its annual budget.”

Imoukhuede believes Nigeria’s economy is still a positive for the insurance industry, since the country’s economy is still predicted to grow, although at a slower rate; however, Imoukhuede said investors should be cautious since there are a lot of uncertainties within the Nigerian market.

Recent episodes of A.M.BestTV include:

  • Investment Allocations Changing ‘On the Margin’: Vice Presidents Jim Gillard and Ken Johnson discuss how insurers have increased their overall risk and reduced liquidity in their investment portfolios to earn extra or preserve yields: http://www.ambest.com/v.asp?v=fminvestments815.
  • Mergers and Acquisitions Pick Up Speed in the Middle East: Senior Financial Analyst Salman Siddiqui discusses how the Middle East is ripe for mergers and acquisitions as insurers look to broaden their profiles and maintain market positions: http://www.ambest.com/v.asp?v=fmmiddleeast815.
  • Homeowners Insurers Tap Predictive Analytics: Senior Financial Analyst Maurice Thomas discusses how U.S. homeowners insurers are increasingly harnessing advanced predictive models to smooth operating volatility in their line of business: http://www.ambest.com/v.asp?v=fmhomeowners815.
  • ‘First Monday’: Rated U.S. Captives Show Some Stress in 2014: Assistant Vice President Steven Chirico said that despite U.S. captive insurers continuing to outperform the commercial insurance sector, industry results are showing some decay: http://www.ambest.com/v.asp?v=fmcaptives815.

A.M.BestTV covers exclusive A.M. Best information and reports, targeted topics and key developments in the (re)insurance industry every Monday, Wednesday and Friday. Sign up for alerts of episodes at http://www.ambest.com/multimedia/ambtvsignup.html. View A.M.BestTV episodes at http://www.ambest.tv.

A.M. Best Company is the world’s oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com.

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Contacts

A.M. Best
Lee McDonald
Group Vice President, Publication and News Services
908-439-2200, ext. 5561
lee.mcdonald@ambest.com

Contacts

A.M. Best
Lee McDonald
Group Vice President, Publication and News Services
908-439-2200, ext. 5561
lee.mcdonald@ambest.com