insurance company business plan in nigeria

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How to set up Insurance and Re-Insurance Business in Nigeria

It is 2021, and a lot of us have established goals on what we want to achieve this year, one of such goal could be setting up an Insurance or Re-Insurance business. If you are planning to set up an Insurance business in Nigeria, then there are some things you need to know.

First on the list is that you need to know the agency know as NAICOM. The National Insurance Commission (NAICOM)    was established in 1997 by the National Insurance Commission Act 1997 with responsibility for ensuring the effective administration, supervision, regulation and control of insurance business in Nigeria and protection of insurance policyholders, beneficiaries and third parties to insurance contracts.

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All new insurance companies that seek to do business in Nigeria must be registered with NAICOM, and the process of setting up such a company passes through four stages.

Stage 1: Preliminary Stage

a) Submission of Letter of Intent from the Promoter(s).

b) Request the Promoter( s) to provide the following:

• Profile of the Directors/current CV of the proposed CEO stating minimum qualification in accordance with Section 31 of Insurance Regulation 2003.
• A Sworn Declaration of Non-Disqualification of the proposed Directors in accordance with Section 2(1) of the Insurance Act 2003 shall be submitted.
• Proposed Company name.
• Draft Memorandum and Articles of Association (MemArt) of the Proposed Company.
• Evidence of Financial Soundness of the Shareholders supported by Sworn Affidavit confirming such.
• Evidence of Confirmation (Clean Bill of Health) from the Primary Regulator and Approval to the Promoter/Joint Venture Partners by the Regulator (where necessary).
• Holding Company Structure and Funding – if Company is a Part of Holding Company.
• The Class of Insurance (whether General, Life and/or Reinsurance Insurance Business) to be transacted. The Class of Insurance will determine the paid-up capital required for the business.

c) Invitation Letter to the Promoters for Pre-qualification Interview.

Stage 2: Application Stage

a) Submission of Completed Registration Application Form along with the following:

• Certificate of Incorporation of a Limited Liability Company.
• Certified True Copy of the Memorandum and Articles of Association of the Company.
• Final Memorandum of Articles of Association.
• Particulars of Directors (Form CO7).
• Allotment of Shares (Form C02)
• Situation of Registered Office (Form C06)
• Background of the Company.
• Organizational Structure of the Company.
• Vision, Mission and Objectives of the Company.
• A Description of the Proposed Geographical
• Area(s) of Operation
• Information Technology (IT) Tools and its relevance to the business.
• Underwriting and Marketing Procedures and Processes
• Investment, Accounting, Management Information System (MIS) Reporting etc.
• Complaint and Grievance Management Systems and Procedures.
• Evidence of Payment of Non-refundable Application Fee.
• Issuance of Letter of Authorisation to CBN on Statutory Deposit.

Stage 3: Verification Stage

• Evidence of compliance with Minimum Paid-Up Capital Requirements : N10.0 Billion (General), N8.0 Billion (Life), N18.0 Billion (Composite), N20.0 Billion (Reinsurance)
• Evidence of Minimum Deposit with the Central Bank of Nigeria (Le. 50% of Paid Up Share Capital).
• Details and Employment/Career History of the Proposed CEO, Senior Management, Secretary and Heads of Departments.
• Good Corporate Governance Framework for Insurance & Reinsurance
• Copy of the CEO’S Appointment Letter and his Acceptance Letter.
• Copy of the CEO’S resignation of appointment in the former place of employment and the Acceptance of same.
• A Declaration by the CEO/Director that the business shall be transacted in accordance with Sound Insurance Principles.
• A Sworn Affidavit by each Director, Manager and Company Secretary that he/she is not disqualified under the Provisions of Section 12(1) of the Insurance Act 2003 from being a Director, Chief Executive, Manager or Company Secretary (details to be stated in the Affidavit) together with recent Passport Photographs.
• Completed Personal History form of Directors and other Principal Officers
• Proposal forms
• Policy documents
• Cover notes / Certificates
• Claims forms
• Table of premium rates and their basis
• Evidence of adequate and valid reinsurance/retrocession arrangement of the Company.
• Statement as to the method of distributing profits as between policyholders and shareholders in the case of life business (Where Applicable)
• An Actuary statement or report as to the calculation of premium Rates and Non- forfeiture values (in case of life), terms and conditions to be offered and other related issues.
• The reinsurance business intended to be transacted and sample of Cover Notes and/or contract wordings.

Stage 4: Registration Stage

• Pre-Registration Interview
• Publication of Applicant to Members of Public.
• Notification of Success or Otherwise After 21 Days of Publication.
• Issuance of Letter of Success
• Evidence of Payment of Registration Fee
• Issuance of Certificate Registration

To get your goal of setting up an Insurance business going, you might want to visit the nearest NAICOM office to you. According to information on its website, there are 5 offices of NAICOM;

• Abuja (Head office) located at Plot 1239, Ladoke Akintola Boulevard, Gark II, Abuja ( [email protected] )
• Kano Zonal Office located at No 162, Farm Centre Road, Kano State
• Port Harcourt Zonal Office located at No 23 Onne Road, G.R.A Phase 2 Via Airtel Office Port Harcourt, Rivers State
• Lagos Office located at NIC Alagbon Street, Off Ikoyi Road, Victoria Island Lagos
• Enugu Office located at C1 Presidential Road, P.O. Box 2304, Enugu, Enugu State

By, Nnamdi M.

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Business Insurance in Nigeria – Types, Costs, Benefits, and More

• Reading time: 29 mins read
• Post category: Nigeria Tips / Small Business Nigeria

Home » Nigeria Tips » Business Insurance in Nigeria – Types, Costs, Benefits, and More

Are you in charge of a business in Nigeria? Whether you run a small shop in your neighbourhood or a big company, protecting your business from things that could go wrong is important. Just like you need locks and alarms to protect your house, you need business insurance to protect your business. In this piece, we’ll look at the world of business insurance in Nigeria, focusing on those who have only finished high school. We’ll show you the basics, the different kinds of insurance you can get, and how it can help your business. So, let’s learn more about this important topic and find out how business insurance in Nigeria can protect your hard work and give you peace of mind.

Table of Contents

How much does insurance cost for a business in Nigeria?

Retail, service, and other types of small businesses:

• General liability insurance starts at ₦50,000 per year and goes up to ₦200,000 per year.
• Prices range from ₦30,000 to ₦150,000 per year for property insurance.
• Professional liability insurance costs between ₦100,000 and ₦300,000 per year.
• Workers’ comp insurance costs between ₦50,000 and ₦150,000 per year.

Medium-sized businesses (in industry, technology, etc.):

• General liability insurance costs between ₦200,000 and ₦500,000 per year.
• Prices range from ₦150,000 to ₦500,000 per year for property insurance.
• Professional liability insurance costs between ₦300,000 and ₦700,000 per year.
• Workers’ comp insurance costs between ₦150,000 and ₦400,000 per year.

Large corporations and high-risk industries:

• General liability insurance starts at ₦500,000 annually and goes up for big businesses and fields with many risks.
• Property insurance starts at ₦500,000 per year and goes up from there.
• Professional liability insurance costs more than ₦700,000 annually and starts at that amount.
• Workers’ comp insurance starts at ₦400,000 annually and goes up from there.

It is important to remember that these numbers are only estimates and can change based on how each business is run. To get an accurate estimate of costs, it is best to call insurance companies, give them detailed information about the business, and ask for customized quotes.

It is important to remember that business insurance prices are sometimes different and can change based on each person’s needs. Remember that it is essential not to skimp on the coverage your business needs. Not having enough insurance can lead to considerable financial risks if something unexpected happens or you’re sued.

Read Also: What Is the Cost of Accounting Services for Businesses in Nigeria?

Types of Business Insurance in Nigeria

Different kinds of insurance in Nigeria can help you protect your business and keep your hard work safe from risks. Let’s talk about some popular types of business insurance that you should know about:

Insurance for property

Your business property is worth a lot, so it’s vital to keep it safe. Property insurance includes buildings, equipment, and inventory. It helps you get your money back if something happens to your property, like a fire, theft, or natural disaster. In addition, when you have property insurance, you don’t have to worry about your belongings.

Liability insurance

Accidents happen, and if someone gets hurt or their property gets damaged because of your business, you could be held responsible. Liability insurance protects you from legal lawsuits and other obligations. Liability insurance comes in different forms, like general liability and professional liability. Public liability covers claims from people who get hurt on your property, like customers or guests. On the other hand, professional responsibility covers claims that come up because of the professional services or advice you give. Liability insurance protects your business from legal steps that could cost a lot of money.

Business Interruption Insurance

Unexpected problems can significantly affect how your business works and how much money you make. This is where insurance for business disruptions comes in. This kind of insurance covers lost income when your business can’t run because of things like fire, theft, or natural disasters. It can help you pay regular costs and keep your business going when times are hard.

Insurance for employees

Your workers are the most crucial part of your business, so it is vital that they’re happy and healthy. Insurance for your staff, like workers’ compensation and group health insurance, protects them if they get hurt or sick while working for you. Workers’ compensation pays for medical care and lost wages for employees who get hurt on the job. Group health insurance covers your employees and their families for medical care. When you take care of your workers’ insurance needs, it not only helps them but also makes the workplace healthier and more productive.

Remember that each type of insurance serves a different purpose, and the coverage you choose will depend on the needs and risks of your business. However, getting the proper insurance can protect your business from the unexpected and focus on growing and doing well in Nigeria’s fast-paced business world.

Advantages of Business Insurance in Nigeria

If you own a business in Nigeria, why is it vital to have business insurance? So, let’s talk about how it can help you and your business:

Financial security in case of unexpected events

There are many unknowns in life; the same is true for your business. Business insurance protects your money in case something terrible happens to your business. Whether it is a fire that damages your property, a customer who sues you for damages, or a natural disaster that stops your business from running, insurance can help cover the costs and keep your business from losing money. In addition, it enables you to get better and get back on your feet faster.

Keeping business risks to a minimum

Some risks come with running a business. You can reduce these dangers with business insurance. By giving the insurance business some possible risks, you can protect yourself from significant financial losses. In addition, insurance can cover the costs of a loss so that your business doesn’t have to take on the whole thing. This helps keep your business’s finances stable.

Business owners can have peace of mind and trust

When you have insurance, you don’t have to worry as much. You can focus on running and building your business instead of constantly worrying about “what ifs.” Knowing you have a safety net can give you more security and freedom to make decisions. It makes you feel safe because you know you’ve done something to protect your business and its future.

Stakeholders will have more faith and believe in you

Customers, sellers, and business partners will be more likely to trust you and believe in your business if you have business insurance. It shows that you are a trustworthy business owner who takes your responsibilities carefully. In addition, insurance can make it easier for clients and business partners to work with you since they know you have plans to deal with the unexpected.

Factors to Consider when Choosing an Insurance Provider

When choosing an insurance company in Nigeria for your business, there are some essential things you should think about. By thinking about these things, you can make an educated choice and find the best insurance company for your needs. Here are some important things to think about:

Reputation and Stability of Finances

Choosing an insurance company with a good name and strong finances is important. Look for insurance companies that have been around for a long time and have a good reputation for reliability. Check with the relevant regulatory bodies to see if the business is registered. You can be sure that your insurance company will do what it says it will do if you need to make a claim if it has a good reputation and is financially stable.

Different kinds of coverage

Check to see what kinds of benefits the insurance company offers. Consider your business’s unique needs and ensure the insurance company has policies that meet those needs. Look for flexible coverage choices so you can make the insurance fit the needs of your business.

Customer Service and Support

Consider how good the insurance company is at customer service and support. A good insurance company should have a helpful and easy-to-reach customer service team. They should be able to answer your questions, help you with things about your coverage, and show you how to file a claim. Good customer service makes sure that your relationship with the insurance company goes smoothly and is a good one.

Costs of Premiums and Ways to Pay

Find out how much the insurance plans’ premiums will cost. Compare different insurance companies’ prices to ensure you get a good deal. Also, find out what payment choices are available. For example, some insurance companies have open payment plans that let you pay your premiums over the year. This makes it easier on your finances.

Claims Process and Settlement

Learn how the insurance company handles cases. Find out how easy and quick the process is if you need to make a claim. Check to see if the payment process is transparent, and make sure that the insurance company is known for paying claims quickly and fairly. You need an insurance company that will be there for you when you need it most.

Business Insurance in Nigeria: Challenges and Things to Think About

When getting insurance for your business in Nigeria, there are a few things you should know and think about. These things can affect how you protect your business and make choices. Let’s look at some of the problems and things you might have to think about:

Cost of premiums and ability to pay

One problem is how much insurance costs. When figuring out how much your payment will be, insurance companies look at the size of your business, your industry, and your risks. Therefore, it is vital to find a mix between getting enough coverage and being able to pay for it. Compare insurance quotes from different companies to find the best plan for your business.

Limited awareness and understanding of insurance

Many business owners know and understand very little about insurance. Learning about the different kinds of news and what they cover is very important. Talk to people who work in the insurance business. They can explain the terms and conditions in plain English. If you know how insurance works, you can make intelligent choices and make sure your business is well protected.

How to file a claim and possible delays

It can be hard to deal with insurance cases sometimes. There may be specific paperwork and research steps that need to be done. It is essential to learn about how your insurance company handles cases. Keep all important papers in order and easy to find. Know that settling a claim could take a while, and there could be delays. During the claims process, being patient and working together is important.

How important it is to have enough coverage and review policies

Your business must have enough insurance. Check your insurance policy to ensure it covers your business’s risks. Review your policy often to ensure it still meets your business’s goals. Your insurance needs may change as your business grows or changes. Stay on top of your coverage and make changes as needed to avoid holes in your security.

Legal requirements must be met

Insurance coverage must meet specific legal standards for businesses in Nigeria. Depending on the size and type of your business, some kinds of insurance, like worker’s comp, may be required. Learn about these law requirements to follow them and avoid fines.

How to Get Insurance for Your Business in Nigeria

If you want to get business insurance in Nigeria, you should be careful and thoughtful about how you go about it. Here are some tips to help you understand insurance and make wise choices:

1. Check the risks your business faces

Start by making a list of the possible risks your business could face. Then, think about things that could go wrong, like theft, fire, lawsuits, or natural disasters. By knowing your risks, you can figure out what kinds of insurance you need and make sure you’re well covered.

2. Find out about insurance companies and compare them

Research the different insurance companies in Nigeria. Look for companies with a good name, are financially stable, and offer many kinds of coverage. Compare the prices, benefits, and customer reviews of various providers to find the one that best fits the needs of your business.

3. Ask for Help

Insurance can be hard to understand, so you should talk to insurance pros or brokers. They can help you determine what kind of insurance you need, walk you through the process, and suggest good coverage. Their knowledge can help you make smart choices and pick the best insurance company.

4. Read and understand the terms of the policy

Before buying insurance, carefully read and understand the terms and conditions of the policy. Pay attention to the coverage limits, exclusions, deductibles, and other important information. Be bold and ask questions if there’s something you need help understanding. When making a claim, there will be no shocks if you understand the policy well.

5. Maintain the correct paperwork

Keep all necessary paperwork in order and easy to find. This includes records of your business’s assets, financial statements, contracts, and any other papers the insurance company may need during the underwriting process or in case of a claim. Proper paperwork makes the insurance process easier and ensures you have all the necessary information.

6. Check your coverage and make changes

Review your insurance coverage often to ensure it fits your business’s changing needs. Your insurance needs may change as your business grows or as you add new goods or services. Keep your insurance company updated on any significant changes to your business so you don’t lose coverage.

7. Keep a good relationship with the company that gives you insurance

Build a good bond with the company that offers you insurance. Openly talk to each other, tell any problems that could lead to a claim immediately, and answer questions as soon as possible. Having a good relationship with your insurance company builds trust and makes filing a claim easier when needed.

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What Factors Affect the Cost of Business Insurance in Nigeria?

When getting business insurance in Nigeria, it is normal to wonder how much you can expect to pay on average. The price of business insurance depends on several things that are unique to your company. Several things go into figuring out how much business insurance costs in Nigeria. Knowing these things can help you determine how much insurance will cost for your business. Here are some of the most important things that affect how much business insurance costs:

1. Size and Type of Business

The insurance cost can vary a lot depending on the size of your business and the type of business you run. Larger companies with more assets and workers usually pay more for insurance because they are more likely to face risks. Also, some businesses, like construction or manufacturing, may be seen as higher risk, which can make insurance costs go up.

2. Making money and running a business

The insurance cost can also be affected by how much your business makes and what it does. For example, companies that make more money usually need higher coverage levels, so their premiums increase. In the same way, if your business does high-risk things or works in more than one place, it can lead to higher insurance costs because it is more likely to be sued.

3. Evaluation of the risk and history of claims

Insurance companies examine your business’s risk to determine how much insurance will cost. They look at how many claims have been made in the past, what safety steps have been put in place, and how risk is managed. Insurance rates may be higher for a business with a history of many claims or lousy risk management. This is because the business is seen as a higher risk.

4. Type and Amount of Coverage

The insurance cost is also affected by the type of coverage you choose and the amount of coverage you get. For example, the cost of the premium can go up if you get more coverage, like security against natural disasters or cyber risks. In the same way, bigger coverage limits give you more protection but may cause your premiums to go up.

5. Deductibles and Terms of the Policy

How much you pay for insurance depends on how much you pay as a deductible. If you have a higher deductible, you will have to pay more of the original costs of a claim. This can lower your premium. The insurance cost can also be affected by how long the coverage is in effect and by any add-ons or riders.

6. The insurance company and the state of the market

Different insurance companies may charge different premiums for coverage that is the same. It is essential to get prices from multiple carriers and compare them to find the best deal. Also, market conditions like the profitability of the insurance business as whole and economic factors can affect premium rates.

How to Cut Costs of Business Insurance in Nigeria

Many Nigerian business owners must figure out how to handle business insurance costs. Even though insurance is vital to protect your business, there are ways to lower your insurance costs. Here are some ways to cut down on the cost of business insurance:

Implement risk management practices

Taking steps to reduce risks in your business can lower your insurance costs. This means putting safety measures like fire alarms, security systems, and employee training programs in place. In addition, insurance companies often give savings to businesses that show they know how to handle risks well.

Review and change your coverage often

Review your insurance policy often to ensure it meets your business’s needs. As your business evolves, your insurance needs may change. Get rid of any coverage you no longer need, and think about changing the limits of your coverage to match the present value of your assets. Keeping your coverage up to date helps you avoid paying too much for benefits you don’t need.

Shop around and look at different prices

Don’t go with the first insurance price. Instead, shop around for insurance and get quotes from multiple companies. This lets you compare different types of coverage and premiums. Before choosing, consider the company’s image, financial stability, and customer service.

Bundle your insurance with the same company

Think about getting multiple types of insurance, like general liability and property insurance, from the same company. You often get a discount when you buy multiple plans from the same company. This could save you money and make it easier to handle your insurance.

Make deductibles higher

A deductible is the amount you agree to pay out of your pocket before your insurance coverage kicks in. Your insurance rate can go down if you raise your deductible. But ensure you can quickly pay the bigger deductible if you need to file a claim.

Keep a good record of claims

If you have made a lot of insurance claims in the past, your prices might go up. To keep your insurance costs low, put safety at the top of your business’s list of priorities and use risk management practices to keep accidents and incidents to a minimum. This helps keep your claims past clean and shows insurers that your business is responsible and low-risk.

Get help from a professional

Talk to insurance professionals or brokers who can help you find affordable insurance coverage. They can help you find your way around the insurance market, understand policy terms, and find ways for your business to save money.

Frequently Asked Questions about Business Insurance in Nigeria

What is insurance for a business.

Business insurance is a type of coverage that saves your company from financial losses caused by risks or events that were not expected. It gives you money to compensate for damages, fines, and losses that may happen while your business runs.

Why do I need protection for my business?

Insurance for your business is vital because it protects it from possible threats and liabilities. It helps pay for things like accidents, property loss, lawsuits, and other things you can’t plan for. Having insurance can help you get back on your feet and keep running your business without putting an immense financial strain on you.

What types of business insurance are available in Nigeria?

There are different kinds of business insurance in Nigeria, such as general liability insurance, property insurance, professional liability insurance, workers’ compensation insurance, and business loss insurance. Each kind of insurance covers a different set of risks and responsibilities.

How much does insurance for a business cost?

The cost of business insurance depends on the size of your business, the industry you work in, the amount of coverage you choose, and the level of risk your business activities pose. Get quotes from several insurance companies to get a good idea of how much it will cost for your business.

Is it required to have business insurance in Nigeria?

Some types of insurance, like workers’ compensation, are required for some businesses. Still, Nigeria’s general need for business insurance depends on your business and how big it is. But ensuring your business has enough insurance to protect it from possible dangers and liabilities is very important.

How do I choose the right business insurance provider?

When picking an insurance company, you should consider its reputation, financial stability, customer service, options for coverage, and prices. It is a good idea to look into different companies, compare quotes, and ask trusted sources for suggestions. Talking to insurance agents or pros can also help you make a good choice.

How do I make a claim on my insurance?

Most of the time, you must inform your insurance company about a claim after the event as soon as possible. First, give all the information and proof you need about the claim, such as incident reports, photos, or witness comments. Then, follow the steps your insurance company gives you for making a claim, and help with any necessary investigations or reviews.

What factors should I consider when reviewing my insurance coverage?

When reviewing your insurance coverage, you should consider how your business is run, assets, income, and the general risk landscape. Then, check to see if your current coverage is enough to protect your business from possible risks. Also, you should look over the policy’s terms, exclusions, deductibles, and monthly costs.

Can I change my insurance policy while it is still in effect?

Sometimes, you can change your insurance policy while you’re still covered. It is best to talk to your insurance company to determine how they handle changes mid-term. Remember that any changes could cause your monthly costs to go up or down.

What happens if I don’t have business insurance?

Without business insurance, you could be held personally responsible for any financial losses, damages, or lawsuits your company causes. This could cost you a lot of money and even threaten your business’s future.

In Nigeria, business insurance is one of the most important ways to protect your business. It gives you money and peace of mind if something wrong happens or you take a chance. Even though the cost of business insurance depends on things like the size of your business, the industry it is in, the coverage it needs, and the risks it faces, there are steps you can take to lower the cost. Using risk management practices, reviewing and updating coverage regularly, getting quotes from different companies, and asking a professional for help are all excellent ways to control insurance costs.

By knowing the different types of business insurance, the benefits they offer, and the things that affect how much insurance costs, you can make smart decisions to protect your business. Finding a good mix between saving money and getting enough coverage to protect your business from possible risks and liabilities is vital.

Remember to put safety first in your business, record cases well, and review your insurance needs often. By doing this, you can avoid the problems and things to think about with business insurance in Nigeria and get the coverage you need at a fair price.

Buying insurance for your business is an investment in its long-term security and resilience. It gives you a safety net and lets you focus on your main business without worrying about losing money. So, do what you must to get the right business insurance and protect your critical assets.

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Top 10 Insurance Companies in Nigeria for Entrepreneurs

Given society’s constant threat to lives and property, one would look for measures to secure these lives and property. Entrepreneurs look for businesses that could lessen the impact of such an accident.

In Nigeria, the businesses that help mitigate these effects are known as insurance companies.

This post will tell you the leading insurance companies in Nigeria and how they can support business owners. It would help if you are familiar with the definition of an insurance company as you read this article. 

Table of Contents

What is an Insurance Company?

An insurance company is a type of financial firm that offers insurance protection to individuals and companies in return for insurance costs. Insurance firms provide insurance products to shield policyholders against potential financial losses brought on by unanticipated events. These unforeseen circumstances include;  accidents, diseases, or natural disasters, including life insurance, health insurance, car insurance, and homeowners insurance.

Insurance firms evaluate the risks involved in covering a person or a company, and they base the premiums that will be charged on the possibility that a loss will happen. When a policyholder suffers a loss covered by their insurance policy, they can submit a claim with the insurance provider to obtain monetary compensation.

Factors to Consider When Choosing an Insurance Company in Nigeria

You should consider some factors before choosing an insurance company in Nigeria. It is a good idea to carefully consider these factors to ensure you get the coverage and protection you need. They include:

It is important to choose an insurance company in Nigeria with a good market reputation . This can be determined by researching the company’s financial stability, customer service record, and claims handling history.

Coverage options

It is important to choose an insurance company in Nigeria that offers coverage options that meet your specific needs. Consider the types of insurance products available, and the exclusions and limitations of each policy.

Insurance premiums can vary significantly from one insurance company to another, so comparing quotes from multiple companies is important to ensure you are getting the best value for your money.

Claims process

It is important to choose an insurance company in Nigeria with a simple and efficient process. Consider the company’s reputation for handling claims promptly and fairly.

Customer service

Good customer service is important when choosing an insurance company in Nigeria. Consider the company’s reputation for responding to customer inquiries and concerns in a timely and helpful manner.

Financial stability

It is important to choose an insurance company in Nigeria that is financially stable and able to pay claims in a timely manner.

Top 10 Insurance Companies in Nigeria

Leadway Assurance Company

With roots dating back to 1970, LEADWAY Assurance provides life and pensions and general business insurance services. The business also provides portfolio management, bonds, miscellaneous financial losses, secured credit. It also provide related financial services to private individuals and corporate clients.

Most of their operations have been digitized to increase efficacy, and they are active on numerous social media platforms.

What they offer:

• Life insurance
• Medical protection
• Car insurance
• Coverage for real estate
• Protection against liability
• Insurance for travel
• Retirement plans

AIICO Insurance

The insurance, pension, and asset management group, AIICO Insurance Plc, was founded in 1963. It ranks among the top insurance companies in Nigeria. General insurance and special risks, life insurance and annuities, health insurance, asset management, and pension management are some of its main areas of focus. It provides a variety of insurance services and products for companies.

• Vehicle insurance
• Health insurance
• Property insurance
• Travel insurance
• Marine insurance
• Aviation insurance

Custodian and Allied Insurance

Custodian and Allied Insurance is a top insurance company in Nigeria. They provide a range of insurance products and services tailored to meet individuals’ and companies’ needs.

• Investment Plus Plan
• Immediate annuity plan
• Tuition protection plan
• Auto insurance plan
• Travel insurance plan
• Capital plan

Nigerian Agricultural Insurance Corporation (NAIC)

NAIC is a government-owned insurance company that provides insurance coverage specifically for the agricultural sector in Nigeria. Its main goal is to promote the development of the agricultural sector in Nigeria by providing insurance protection to stakeholders in the agricultural industry.

These insurance products protect against various risks and hazards affecting agricultural production, such as natural disasters, pests and diseases, and market fluctuations.

• Crop insurance
• Livestock insurance
• Aquaculture insurance
• Agribusiness insurance
• Technical support

Cornerstone Insurance Plc

Cornerstone Insurance

In Nigeria, Cornerstone Insurance Company is one of the top insurance companies that offer insurance services to individuals and entrepreneurs. The company was established on July 26, 1991, as a private limited liability corporation.

In the end, it changed its legal status to public limited liability, and in 1997 it was traded on the Nigerian Stock Exchange (NSE). Cornerstone Insurance has stayed committed to its mission since its founding, serving its clients’ needs first.

• Motor insurance plan
• Gadget protection plan
• Investment plan
• School fee guarantee plan
• Goods in transit plan
• Home insurance plan
• Life insurance plan
• Annuity plan
• Marine insurance plan

Read Also: How to Improve and Manage Personal Finance as a Nigerian

AXA Mansard Insurance

AXA Mansard is a corporation that belongs to the AXA Group. It is known to be one of the top insurance companies in Nigeria for entrepreneurs and individuals. Both asset management and insurance are top industries for AXA Group.

In over 60 countries, the network of firms provides services to 107 million customers. The company offers people and businesses in the nation solutions for both life insurance and non-life insurance.

• Lifesaving plan
• Instant plan
• Health plan
• Retirement savings plan
• General (business/tourism) protection plan
• Student protection plan
• Autoflex plan
• Equity income plan
• Auto classic plan
• Money market plan
• Easy care plan

Read Also: Top Banks in Nigeria for Entrepreneurs

Universal Insurance

Universal Insurance is a top insurance company in Nigeria that offers a range of insurance products and services for businesses and individuals.

• Motor insurance
• Liability insurance
• Pension and annuity products
• Agricultural insurance
• Group insurance

Goldlink Insurance Plc

One of the top insurance companies in Nigeria for entrepreneurs is the Goldlink Insurance Company. It was established on April 15, 1992, as a private limited liability company. On May 11, 2007, it underwent a conversion to become a public liability company.

It experienced an introduction to the stock exchange market on February 12, 2008, and was listed on the NSE. The general and life business operations of Goldlink Insurance Plc are both authorized.

• Group life insurance plan
• School Safety Plan
• Compulsory Insurance Plan
• Liability Policies Plan
• Marine and Aviation Plan
• Motor Insurance Plan
• General Accident Plan
• Individual Life Insurance Plan
• Oil and Gas Plan
• Engineering Insurance
• Reinsurance plan

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Royal Exchange General Insurance

This company is a top insurance company in Nigeria that provides a range of insurance products and services for businesses and individuals. Royal Exchange provides insurance products such as,  liability insurance, property insurance, and motor insurance.

• Oil and gas insurance
• General accident insurance
• Engineering insurance
• Industrial All Risks Insurance
• Fire and special perils insurance

Lasaco Assurance Plc

One of Nigeria’s top insurance companies is Lasaco Assurance Plc. According to the 1968 Companies Decree, it was incorporated on December 20, 1979. Individuals and organizations can take advantage of the variety of insurance services offered by this company.

• Aviation insurance plan
• Money insurance
• Householder’s insurance Plan
• Fire and Special insurance Plan
• Professional indemnity insurance
• Bond insurance plan
• Personal accident plan

Many insurance companies in Nigeria offer a range of insurance products and services to individuals and businesses. It is important to highlight the importance of insurance in protecting individuals and businesses against financial loss due to unexpected events.

Insurance can help provide peace of mind and financial security in the face of unforeseen circumstances, and it is an important part of a well-rounded financial plan.

It is important for individuals and businesses to know what they should insure and to find the best coverage at the most affordable price.

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Insurance in nigeria: regulation and compliance.

Last Updated on July 18, 2023

Introduction

Insurance in Nigeria plays a pivotal role in securing assets and providing financial safety nets for individuals and businesses alike.

It protects against unexpected financial losses, ensuring economic stability. Yet, the system can falter without robust regulation and compliance.

Regulation in Nigeria’s insurance industry provides a framework. It maintains standards, ensuring every player operates within defined parameters.

This results in a fair, stable, and competitive market. Compliance, on the other hand, helps to uphold these standards. Insurers adhere to established rules, avoiding malpractices that could compromise the industry’s integrity.

The importance of regulation and compliance cannot be overstated. They enhance trust among stakeholders, creating a conducive environment for growth.

They ensure the industry remains viable, transparent, and effective. Together, regulation and compliance protect the interests of policyholders, fostering a dependable insurance industry.

Summarily, these components act as the bedrock of insurance in Nigeria, ensuring its effectiveness and longevity.

Overview of Insurance Regulation in Nigeria

The regulatory body (naicom) and its role.

• NAICOM, the National Insurance Commission, is the regulatory body responsible for overseeing the insurance industry in Nigeria.
• NAICOM’s role is to ensure the effective regulation, supervision, and development of the insurance industry.
• It also protects the interests of policyholders and promotes the growth and stability of insurance companies.
• NAICOM enforces the laws, regulations, and guidelines that govern insurance operations in Nigeria.

Key regulations and laws governing insurance in Nigeria

• The Insurance Act of 2003 is the primary legislation that governs the insurance industry in Nigeria.
• It provides a legal framework for the registration, licensing, and operation of insurance companies.
• The Insurance Act also defines the rights and obligations of insurers, policyholders, and intermediaries.
• Another key regulation is the Insurance Regulation 2010, which supplements the provisions of the Insurance Act.
• This regulation covers various aspects of insurance business, including solvency requirements, investments, and reporting obligations.
• Other regulations, guidelines, and circulars may also be issued by NAICOM to address specific issues in the insurance industry.
• These additional regulations may cover areas such as microinsurance, takaful (Islamic insurance), or bancassurance.

Basically, the insurance industry in Nigeria is heavily regulated to protect the interests of policyholders and ensure the stability of insurance companies.

NAICOM, as the regulatory body, plays a crucial role in enforcing the regulations and promoting compliance within the industry.

Read: Nigeria’s Insurance Market: Opportunities and Risks

Objectives and Benefits of Insurance Regulation

A well-regulated insurance industry is crucial for protecting policyholders and ensuring the stability and growth of insurance companies.

Ensuring fair practices and protection for policyholders

• Insurance regulation mandates transparency and accountability to prevent unfair practices.
• It ensures that policyholders receive the coverage they paid for, without deceptive terms or hidden clauses.
• Regulations also establish mechanisms for addressing policyholder grievances and disputes.

Maintaining financial stability of insurance companies

• Regulation requires insurers to maintain sufficient financial reserves to cover potential claims.
• Guidelines on solvency and capital adequacy prevent insolvency and protect policyholders’ claims.
• Monitoring and supervision by regulatory bodies prevent excessive risk-taking and financial mismanagement.

Promoting market confidence and trust

• Insurance regulation builds trust among consumers, encouraging them to participate in the market.
• Regulatory oversight ensures that insurers fulfill their obligations and honor their commitments.
• Enforcement actions against fraudulent practices improve the industry’s reputation and credibility.

Facilitating industry growth and development

• Insurance regulation supports the growth of the insurance industry by fostering a stable business environment.
• Regulatory frameworks attract local and foreign investors, stimulating competition and innovation.
• Regular assessments of market conditions help identify emerging risks and adapt regulations accordingly.

Overall, effective insurance regulation plays a crucial role in balancing the interests of insurers and policyholders. It ensures fairness, stability, trust, and growth within the insurance market, benefiting the economy as a whole.

Read: Understanding Insurance: A Basic Guide for Nigerians

Compliance Requirements for Insurance Companies

Insurance companies operating in Nigeria are subject to various compliance requirements.

These regulations aim to ensure the stability and credibility of the insurance industry, protect policyholders’ interests, and promote fair competition among insurance providers.

In this section, we will explore the key compliance requirements that insurance companies in Nigeria must adhere to.

Registration and licensing process

Before engaging in insurance business in Nigeria, companies must undergo a registration and licensing process.

This involves submitting an application to the regulatory body, the National Insurance Commission (NAICOM).

The application must include relevant documents and information, such as the company’s incorporation details, business plan, and management structure.

The NAICOM assesses the application based on specific criteria, including the financial strength of the company, its proposed product offerings, and the qualifications of its management team.

Once satisfied with the application, the NAICOM grants the license, allowing the company to operate as an insurance provider in Nigeria.

Capitalization requirements

Insurance companies are required to meet minimum capitalization requirements to ensure their financial stability and ability to meet policyholder obligations.

The NAICOM sets these requirements based on the type of insurance business the company intends to undertake.

For example, a life insurance company is required to have a higher minimum capital compared to a non-life insurance company.

The purpose of these requirements is to prevent undercapitalized insurance companies from entering the market and potentially compromising policyholders’ claims settlement.

Solvency and financial reporting obligations

Insurance companies in Nigeria must regularly demonstrate their solvency and financial stability. They are required to maintain adequate reserves to cover potential claims and unexpected losses.

The NAICOM establishes guidelines for financial reporting, including the preparation and submission of audited financial statements.

These financial statements provide transparency and ensure that insurance companies accurately reflect their financial positions.

They also enable the regulator to assess the company’s compliance with solvency ratios, which measure the company’s ability to meet its financial obligations.

Compliance with underwriting and claims procedures

Insurance companies must comply with underwriting and claims procedures to ensure fair and transparent practices.

The NAICOM sets guidelines for underwriting policies, including risk assessment and pricing methodologies. Insurers are required to adhere to these guidelines to prevent unfair discrimination in premium determination.

Similarly, insurance companies must implement clear and efficient claims procedures.

This includes promptly processing and settling valid claims, providing policyholders with fair compensation, and adopting a proactive approach to resolving any disputes that arise during the claims settlement process.

Compliance with ethical standards and market conduct rules

Insurance companies are expected to maintain high ethical standards and comply with market conduct rules. These rules aim to promote fair competition, protect consumers, and prevent fraudulent practices in the insurance industry.

Insurance providers must conduct their business with utmost professionalism, integrity, and transparency.

They are expected to respect the confidentiality of customer information, avoid misleading advertisements, and provide accurate and comprehensive information about their products and services.

In general, insurance companies operating in Nigeria must comply with various regulations to ensure the stability and credibility of the industry.

These requirements cover areas such as registration and licensing, capitalization, solvency, underwriting and claims procedures, as well as ethical standards and market conduct.

By adhering to these compliance requirements, insurance companies can build trust, protect policyholders’ interests, and contribute to the growth of the Nigerian insurance sector.

Read: Financial Literacy: The Role of Insurance in Nigeria

Supervision and Enforcement of Insurance Regulations

Naicom’s role in supervision and oversight.

• NAICOM ( National Insurance Commission ) is responsible for supervising and overseeing insurance activities in Nigeria.
• NAICOM ensures compliance with insurance regulations to protect the interests of policyholders.
• The commission sets standards and guidelines for insurance companies and monitors their operations.
• NAICOM also reviews and approves insurance products and policies before they are offered to the public.

Monitoring compliance through inspections and audits

• In order to ensure compliance, NAICOM conducts regular inspections and audits of insurance companies.
• These inspections involve a review of the company’s financial records, operations, and compliance with regulations.
• NAICOM also assesses the company’s risk management practices and the adequacy of their capital reserves.
• The goal of these inspections is to identify any deficiencies or non-compliance issues and take appropriate action.

Imposition of penalties for non-compliance

• If NAICOM identifies any non-compliance issues during inspections or audits, it has the authority to impose penalties.
• The penalties can include fines, suspension, revocation of operating licenses, or other disciplinary actions.
• By imposing penalties, NAICOM aims to ensure that insurance companies comply with regulations and protect policyholders.
• The severity of the penalty depends on the nature and extent of the non-compliance.

Mechanisms for resolving disputes and complaints

• NAICOM provides mechanisms for policyholders and other stakeholders to resolve disputes and complaints.
• These mechanisms include a dedicated complaints resolution department within NAICOM.
• Policyholders can file complaints with NAICOM if they feel their insurance company is not fulfilling its obligations.
• NAICOM investigates the complaints and mediates between the parties to resolve the dispute.

In fact, NAICOM plays a crucial role in supervising and enforcing insurance regulations in Nigeria.

Through inspections, audits, and the imposition of penalties, NAICOM ensures compliance and protects the interests of policyholders.

In addition, the commission provides mechanisms for resolving disputes and complaints, further contributing to a fair and transparent insurance industry.

Read: Insights on High Yield Investments in Nigeria’s Market

Challenges in Insurance Regulation and Compliance in Nigeria

Inadequate enforcement and resources.

• Insufficient funding hampers the capacity of regulatory bodies to effectively enforce insurance regulations.
• Lack of human resources and technical expertise further weaken the enforcement of compliance measures.
• Inadequate monitoring mechanisms make it difficult to detect and deter non-compliance by insurance companies.
• The absence of strong penalties for violations undermines the effectiveness of regulatory efforts.

Lack of industry awareness and education

• Many stakeholders in the insurance industry, including policyholders, have limited knowledge about regulatory requirements.
• Insufficient awareness of compliance obligations leads to unintentional violations and regulatory non-compliance.
• The absence of a comprehensive education campaign inhibits the development of a compliant insurance ecosystem.
• There is a need for targeted initiatives to educate insurance companies, intermediaries, and consumers about compliance practices.

Complexity of regulatory requirements

• The current regulatory framework in Nigeria contains multiple, complex and often overlapping requirements.
• The intricacy of compliance obligations creates challenges for insurance companies, especially smaller players.
• The complexity also increases the risk of misunderstandings and misinterpretation of regulatory provisions.
• Simplifying and streamlining regulatory requirements can enhance compliance and reduce the burden on insurers.

Need for constant updates to keep pace with changing dynamics

• The insurance industry is constantly evolving, with new products, technologies, and risks emerging.
• Regulatory frameworks must adapt to address novel challenges and keep pace with industry developments.
• Regular updates to regulations are necessary to ensure they remain relevant and effective.
• Collaboration between regulatory bodies and industry stakeholders is vital for identifying the need for updates.

In a nutshell, the regulation and compliance of the insurance industry in Nigeria face several challenges.

Inadequate enforcement, a lack of industry awareness and education, the complexity of regulatory requirements, and the need for constant updates all pose obstacles to achieving effective regulation and compliance.

To overcome these challenges, it is crucial for regulatory bodies to receive adequate funding and resources to enforce insurance regulations.

Furthermore, awareness campaigns and educational initiatives should be implemented to enhance industry knowledge about compliance obligations.

Simplifying regulatory requirements and keeping them up-to-date with changing dynamics will also contribute to a more compliant and robust insurance sector in Nigeria.

A recap of the importance of regulation and compliance in the Nigerian insurance industry is necessary to understand its significance. It ensures fair market practices, protects policyholders, and enhances the industry’s reputation.

Without effective regulation and compliance, the industry can face numerous challenges, including unethical practices, fraud, and financial instability.

To build a robust insurance sector in Nigeria, stakeholders must actively support and strengthen the regulatory framework.

This requires collaboration between industry players, regulators, and government agencies. It is essential to promote transparency, accountability, and adherence to regulatory standards to foster trust in the insurance industry.

Stakeholders, including insurance companies, brokers, reinsurers, and consumers, should actively participate in the regulatory process.

They should provide feedback, suggestions, and insights to improve the regulatory framework and ensure its relevance in a rapidly evolving market.

What’s more, stakeholders should prioritize investment in technology and human resources to enhance regulatory compliance.

Embracing digitalization can streamline processes, facilitate data analysis, and detect fraudulent activities more effectively.

Adequate training and education for industry professionals are also crucial to promote compliance and ethical practices.

Ultimately, regulation and compliance play a vital role in the Nigerian insurance industry.

They protect the interests of policyholders, foster market stability, and drive sustainable growth.

It is the responsibility of all stakeholders to support and strengthen the regulatory framework to ensure a robust and trusted insurance sector in Nigeria.

Nigeria’s Insurance Market: Opportunities and Risks

• How Insurance Affects Personal Finance in Nigeria

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SME Insurance Plans in Nigeria You Should Know

SMEs in Nigeria are major economic drivers, but many business owners often do not have plans in place for a worst-case scenario. Fire, floods or some other unforeseen problem could arise in the course of doing business. When they do, the protection of a safety insurance net might make the difference between the survival and death of the SMEs in question.

The Nigerian Insurance industry is a massive industry covering accidents from fire, auto, oil, gas, and so on. They also provide insurance plans that cover for SMEs because these are the backbone of the Nigerian economy. There are various things to consider when choosing the best SMEs Insurance Plans for your business needs. That’s why we are breaking down the types of Insurance policies available to your SMEs in Nigeria to help make the right call:

1. Fire And Special Perils Insurance Plan

This is a crucial SME Insurance Plan in Nigeria because it increases the chances of survival for SMEs. This insurance plan covers your business against damage and losses resulting from fire, lightning, explosion or storms. But it also protects your business from losses arising from floods, riots, strikes, and other enumerated special perils that may occur in your line of business.

If you recall, earlier this year, Nigeria had witnessed various fire incidents with most of these fires affecting business premises and markets. This insurance will protect your business against loss or damage as a result of rain, flood and storm because, under this plan, your insurer will pay back all your losses, giving you the capital you need to revive your SME.

An example of this plan is the Mansard insurance scheme for SMEs in Nigeria. The service was made available under the MTN ‘Y’ello Biz’, and the insurance package covers registered SMEs against fire, flood and other risks.

2. Professional Liability Insurance Plan

This insurance plan protects a professional business owner from claims or legal liabilities from their clients. It covers a professional SMEs business against negligence claims due to harm that results from mistakes or failure to perform and each industry has its own set of concerns that will be addressed in a customized policy written for a business.

Claims can arise as a result of error, negligence or omission during the course of carrying out your professional duties; and that’s why this plan is essential. This type of insurance is useful if your small business involves selling professional skills or knowledge so if you run your small business as a doctor; lawyer, accountant, or other such professions, having this insurance cover will protect you against damages or claims brought by a client in a court of law within Nigeria. The policy also covers financial losses or legal costs; AIICO Insurance and Zenith Insurance offer online consultations for this.

3. Product Liability Insurance Plan

Unlike the professional liability insurance policy which is tailored to an SME owner’s professional duties, the product liability insurance plan for SMEs in Nigeria works to protect small businesses from liabilities, claims or damages that may arise from the use of its products. 

OIAS offers this SME insurance plan in Nigeria and under this type of policy, financial coverage is provided for the SMEs owner, tailored specifically to his or her specific type of product. Product liability insurance is important, especially for SMEs in Nigeria that manufactures products for sale on the general market. 

4. Business Interruption Insurance Plan

SMEs in Nigeria get interrupted by various events, whether natural disasters or a byproduct of bad governmental policies. The result is that these businesses suffer from income lost while their operations are interrupted and this type of insurance will compensate your business for its lost income at such times. This policy applies to companies that require a physical location to do business, such as retail stores. It takes care of all the costs related to material damage. It also replaces business income lost as a result of fire outbreak, lightning, explosions, or some other specified events which disrupt business operations. 

Depending on the insurer, this SME Insurance Plan in Nigeria can sometimes cover profits that would have been earned had business operations not been disrupted, operating costs based on previous statements of costs and employee wages. SMEs in Nigeria currently that have this policy will undoubtedly recover faster from the coronavirus lockdown losses because they would receive the settlement from their claims.

5. Commercial Property Insurance Plan

Whether your SME owns or leases its space, property insurance is necessary because it covers all your business equipment, signage, inventory and furniture in the event of a fire, storm or theft. The extent of the protection given by this SME insurance plan depends on the terms of each particular policy and this is why you should go through your contract very carefully. If the property you want to be covered isn’t protected, don’t be afraid to insist it be included or to look for a new insurer.

Also, as a result of this pandemic, many SMEs in Nigeria are operating out of the CEO’s homes. If you’re operating your business out of your home, ask your insurer for additional insurance to cover your equipment and inventory in the event of a problem. Combined All Risks Insurance Brokers (CARIB) Nigeria Ltd offers this policy.

6. Goods-In-Transit Insurance Plan 

If you are running an SME in Nigeria focused on hauling of goods from one city to the next, then you might want to consider protecting your goods when on the road with this kind of insurance plan. Due to the poor states of our roads, an astonishing number of accidents take place each day and almost always involves lorries and cargo trucks spilling over their contents on the streets.

The goods-in-transit insurance plan covers your goods from such perils on the load so that even if you lose the goods in transit, you wouldn’t lose your money’s worth as well. It also protects your goods against fire, theft or accidental damage while the goods are being loaded or unloaded, or whilst temporarily housed within the general course of transit. 

7. Burglary Insurance Plan

This is usually combined with fire and special perils insurance but covers the contents of your SMEs business against loss or damage caused by theft from your business premises. There must be forcible entry and/or exit for the insurance company to be liable though and even though money-related items are generally excluded here, you can still add or list them under this burglary policy. 

Doing business in Nigeria is often adversely affected by the activities of thieves. If a break-in occurs on your business and your equipment is stolen, your business insurance policy will cover the cost of replacing the stolen property and sometimes this is all you need to keep your business from going bankrupt.

Finally, when you take out any of these SME Insurance Plans In Nigeria for your business, you’ll be protecting your assets and inventory towards unforeseen circumstances. Understand the underlying conditions of any SME insurance contract you are planning to sign because this will help you understand how much risk your business is exposed to. It will also ensure that you have a hassle-free claim experience in the unfortunate event of any loss.

Samuel Moore

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Is Business Insurance Really Necessary?

As a business owner, you find yourself taking care of a multitude of challenges to keep your business running smoothly. A sound knowledge of business insurance can be of great help in growing and protecting your business. You don’t want your business to be affected by natural disasters beyond your immediate control such as floods, earthquakes or storms. Similarly, protection against criminal activities, civil unrest and terrorism are also of utmost importance and this is where a comprehensive business insurance plan comes into play.

In Nigeria, it is obligatory by law to have insurance cover for certain types of businesses. Let us discuss these in more detail:

Builder’s liability insurance

This is a type of business insurance that must be purchased by builders and contractors planning to     construct any building with 2 or more floors. This will cover you for any personal injury, death of a worker, damage to public property and any other potential risks that come with construction. Failing to acquire a builder’s liability insurance could land you up to 3 years in prison and up to N250,000 in penalties.

Occupier’s liability insurance

If you are the owner of a building that is not used by you solely for residential purpose, you are required to have an occupier’s liability insurance as per federal law. Buildings such as rental houses, hotels, cinemas, shopping malls and any other place used by general public come under this bracket. Occupiers and owners of such buildings are protected in case of damage to property or personal injury due to floods, earthquakes or any other natural disasters. Failing to comply can cost you up to N100,000 in fines and 1 year in prison.

Employer’s liability insurance

This is a type of business insurance that is compulsory for business owners with 4 or more employees. The law in Nigeria requires you to have an insurance plan that would give compensation to the employees in case of injury, illness, disability or death while in service. Employees and their families have a right to claim compensation from the business owner if such an event occurs. Failing to provide this type of business insurance can result in penalty of up to N250,000.

Motor vehicle liability insurance

According to section 3 of the vehicles (3rd party insurance) ordinance, “No person shall use or cause or permit any other person to use a motor vehicle on a road unless a liability which he may thereby incur in respect of damage to the property of third parties is insured with an insurer”. Motor vehicle liability insurance will provide compensation for any injury, property loss or death caused to a third party. All private and public vehicles are required to have this insurance by law and there is a penalty of up to N250, 000 and one year in prison for non-compliance. So, if you are a business owner that require motor vehicles to run the business, it is imperative that you should have a business insurance policy in place.

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Business Insurance – How to get business insurance in Nigeria

January 13, 2021 by Get Insurance Today

Before we delve into Business Insurance, let’s talk about what business entails. Being an entrepreneur can be daunting. From getting business ideas for a solution to getting enough funds, and the right people that believe in your business can sometimes be overwhelming.

Starting your own business (either small or big) is a big, scary step in the unknown no doubt. It comes with lots of risks – the risk of losing your capital, interest, and profit. We explained how to get insurance for your small business and commercial insurance here.

You’re also at risk of employing the wrong employee and losing clients, business deals, and investors.

These are some of the reasons why you should get an insurance policy to cover these events.

What is Business Insurance?

This is a type of insurance that protects a business from losses that may occur. For instance, an interior design company in Lagos Nigeria would need business insurance to cover for possible damages to a client’s property in the line of duty.

Some companies have had it rough as a result of lawsuits that were granted by the Courts. This is why business insurance is essential.

Types of Business Insurance

1. business property insurance.

This insurance  prevents you from losing your business properties. If you own office equipment, tools, a computer, or a property you should consider getting insurance for them to cover for losses and damages.

2. General Liability Insurance

Every business needs a policy that protects them from losses resulting from injury or damage to a third party’s property. A General Liability insurance policy guides against these forms of losses. It is highly recommended for personal use.

3. Professional Liability Insurance

Professional liability insurance is referred to as Errors and Omissions Insurance. It covers third-party claims arising from the negligence of the business.

This form of business insurance policy applies to businesses like professional firms – law firms, accounting firms, consulting firms, and so on.

4. Business Interruption Insurance

This insurance protects you and your company from going under when a catastrophic event occurs.

Circumstances like these make business operations be put on hold and interpreted for days. During this time, your business will experience low revenue. This is because your staff won’t be able to operate in the office. A business interruption insurance policy covers losses like this.

5. Directors’ & Officers’ Liability Insurance

Directors’ & officers’ liability insurance protects individuals who serve as directors and officers for your company against lawsuits brought against them due to their management of the company.

6. Workers Compensation Insurance

Workers’ compensation insurance is a type of business insurance policy that protects your employees if they get injured on the job. This will save you money on paying for their medical bills. It also covers the costs acquired as a result of their absence from work for recovery.

7. Employment Practices Liability

This type of business insurance covers your business from claims of harassment, discrimination, wrongful termination, and any other forms of claims from employees.

How to Get Business Insurance in Nigeria

1. pick the type of business insurance you need.

When you were registering your company at the C.A.C., there were certain protections you got from choosing a business structure like an LLC. However, even the scope of that protection is limiting; this insurance fills in the gaps to make sure both your assets and your business assets are safe. We have listed the 7 types of business insurance you can choose from above.

2. Assess Your Risks

Think about what kind of accidents, natural disasters, or lawsuits could end your business. Only you know best what they may be.

3. Find a Reputable, Licensed Insurance Agent

Insurance agents can help you find business insurance policies that match your needs. They receive their commissions from insurance companies . They get a commission when they sell these policies. Therefore it’s essential to find a licensed agent interested in meeting your needs as much as theirs.

Unfortunately, the possibility of finding such selfless Insurance agents in Nigeria is quite slim. You’re welcome to try your luck.

4. Compare Prices

To ensure that you get the best value for your money, you need to compare the prices of various Insurance companies.

Prices and benefits can vary significantly, hence, you should compare rates, terms, and benefits for insurance offers.

Getting business insurance in the wake of the current economic disruptions cannot be over-emphasized. From the COVID-19 pandemic to other business-threatening events that have plunged into so many businesses – As a business owner, you should be working towards getting business insurance today

Related Posts:

• How To Get Travel Insurance In Nigeria
• How To Get Health Insurance in Nigeria
• 5 ways to get the cheapest life insurance
• How To Get Cheap And Affordable Insurance
• How To Get NHIS & Check NHIS Status
• An Overview of The Insurance Business in Nigeria

About Get Insurance Today

Get Insurance is a digital asset that provides information of a general nature on insurance so that you are well informed about the kinds of insurance coverage that is available and what to consider in choosing an insurance cover that will be suitable, affordable and efficient in mitigating loss, damage or another unforeseen event. We are a company incorporated and operating from the British Virgin Island and our focus is on providing insurance information for African countries.

The information provided on this website is to help you know what to expect or questions/options to consider when seeking an insurance cover that will be the right fit for you, your family and business.

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In the beginning

Industrial And General Insurance Plc (IGI) was first incorporated as a private limited liability company on 31 October 1991 and later re-registered as a public limited liability company in 2007. It commenced business in January 1992 as a composite insurer to transact the business of Life and General insurance, including Pensions and Special Risks. Backed by a strong capital base, first-class professionals and deployment of modern technology, the company quickly established a reputation for exceptional competence and became the preferred insurer for individual and corporate clients seeking premium insurance and related financial services.

Within few years of its existence, the company recorded landmark achievements which underscored its high potentials as a market leader and frontline player in the nation’s insurance industry. IGI made history in 1996 as the first private insurance company in Nigeria to post N1 billion premium income, that is four years after it began operations. In 2004, the company consolidated its leadership position in the industry with a premium income in excess of N4 billion. This was the highest, at the time, by any private insurance company in Nigeria in terms of the volume of business.

Unique Expertise

From inception, IGI demonstrated exceptional skill and expertise in the underwriting of specialised risks in oil and energy, marine, aviation, engineering and industrial risks management. The reputation earned the company national recognition in 1996 when it was appointed by the Federal Government as the leading member of a consortium of insurance companies to handle the insurance programme of the Nigerian National Petroleum Corporation (NNPC), the government-owned oil exploration and refining company. On account of its remarkable performance, the IGI-led consortium was reappointed for 1997 and 1998. IGI also participated actively in the insurance programmes of foreign oil companies operating in Nigeria.

Proudly African

In 2005, IGI launched the African Expansion Programme which marked the beginning of the company’s foray into the African insurance market. This initiative led to the acquisition of 60% majority shareholding in the National Insurance Corporation (NIC), Uganda, after a competitive international bidding exercise. This ground-breaking feat was followed by similar investments in Sonarwa and The Gamstar, the largest insurance companies in Rwanda and the Gambia respectively, where IGI has the controlling shares. Until recently when it undertook strategic restructuring of its assets, IGI had diversified investment interests in telecommunications services, banking, engineering services and healthcare delivery services, among others.

The Visionary Founder

The success story of IGI was grounded in the lofty ambition of the founder, Mr. Remi Olowude (1951-2014), a distinguished insurance professional reputed for revolutionising the insurance industry in Nigeria. His career vision was “to preside over a dynamic, merit-driven and globally focused institution that provides quality service and is engaged in the pursuit of excellence through strategic deployment of technology and human capital resources for optimal attainment of organizational goals.” Olowude pursued his dream with doggedness and precision. He began with the establishment of IGI which instantly became the preferred choice in the nation’s industry. Olowude’s brilliance, courage, entrepreneurial acumen and innovative management style attracted some eminent Nigerian statesmen who teamed up with him as founding members of the Board of Directors. They include: former Head of State, General Dr. Yakubu Gowon (Chairman); former Director-General, Nigerian Stock Exchange, Apostle Hayford Alile; the late frontline businessman and lawyer, Chief Gaffar K. Animashawun; the late former Governor of the Central Bank of Nigeria, Mr. Ola Vincent, and the past Attorney-General of the defunct Western Region of Nigeria, Dr. Lateef Adegbite, also of blessed memory. Before he passed away on 27 September 2014, Olowude was the Executive Vice Chairman of IGI Plc.

Today, Olowude’s vision of Africa’s economic integration has crystalized with IGI pioneering Nigerian insurance and banking investments in Uganda, Rwanda, Ghana and The Gambia. Besides flying Nigeria’s flag in East Africa, the company operates an extensive branch network across Nigeria as well as representative offices in the United Kingdom.

IGI has gained the confidence of discerning individual and corporate clients who value premium risk and benefit-related services. Our cutting edge processes and exceptional response time help us to meet the growing needs of clients in diverse sectors, including banking, oil and energy, manufacturing, engineering, marine and aviation as well as government establishments. Our strategy is to continue to maintain our competitive advantage and build on our blue-chip clientele year on year.

We continually invest in and deploy the latest in Information Technology. This we do to stay ahead of competition in our response time and in the provision of first-rate services tailored to meet the specific requirements of our clientele. The IGI website,  www.iginigeria.com , is structured to facilitate online quotation and payment, policy administration, policy queries and brokers’ portfolio management to guarantee seamless operations and processes. We shall continue to re-engineer our core functions with top-of-the-range IT packages to ensure greater efficiency in service delivery.

Corporate Social Investment

IGI has a rich tradition of good Corporate Citizenship deriving from the company’s consistent sponsorship and promotion of sports, support for government and non-governmental organisations, educational institutions. It also supports causes which promote the values of good citizenship, youth development and healthy living. As a corporate culture and policy, we always align our development and growth with our obligations to communities where we do business. In particular, IGI has carved a niche as Nigeria’s leading sports sponsor and promoter in the insurance industry. The company provides opportunities for talented youths to hone their skills in football, athletics and other games. It is in recognition of its role in sports development that IGI was appointed the Official Insurer of all the national football teams in Nigeria, which include the Super Eagles, Flying Eagles, Under-23, Under-17 and the Falcons.

Our Mission

Core values.

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Top 8 Insurance Companies in Nigeria and Addresses (2024)

Are you looking for the new list of top insurance companies in Nigeria that pay high on car, life, property, business, health, travel ?

If YES, then this is the only article you need to read today.

The insurance industry in Nigeria has grown rapidly and massively in recent times with the emergence of reliable companies.

Therefore, the number of citizens enlightened about insurance has grown over the years.

Although we are only experiencing this now, insurance has existed in Nigeria since the 1960s.

Citizens have always sought ways to protect themselves against fire outbreaks, terminal illness, or death, and later incorporated their businesses and other valuables, too.

According to the National Insurance Commission (NAICOM), there are about 63 insurance companies  operating today in  Nigeria.

This means a lot of options to choose from.

Getting started…

What is Insurance?

Insurance coverage can be defined as a contract in the form of a financial protection policy.

This policy covers the monetary risks of an individual because of unpredictable contingencies.

The insured is the policyholder, whereas the insurer is the insurance-providing company.

The insurers provide financial coverage or reimbursement most times to the policyholder.

The policyholder pays a known fee—an insurance premium—to a professional insurer for the assumption of the risk of an enormous loss, and a promise to pay in the event of such a loss.

The insurer assures it shall cover the policyholder’s losses subject to certain terms and conditions.

Premium payment decides the assured sum for insurance coverage or policy limit.

Features of Insurance Coverage

• Insurance coverage can be provided for medical expenses, vehicle damage, property loss/damage, depending on the insurance type.
• Insurance coverage does not mitigate the magnitude of loss one may face. It only assures that the loss is shared and distributed among multiple people.
• Premium, policy limit, and deductible are the key components of an insurance coverage policy.
• Clients of an insurance company pool in their risks. Hence, they pay the premiums together. So, when one or a few incur a financial loss, the claimed money is given out of this accumulated fund. This makes each client bear a nominal fee.

Benefits of Insurance Coverage

• Insurance coverage provides monetary reimbursement during financial crises and also helps in checking the mental stress arising out of it.
• Insurance coverage provides a feeling of assurance to the policyholders.
• Insurance policy safeguards against unforeseen events and consequential loss.
• Insurance policies help inculcate saving habits among individuals.
• Insurance policies not only equivalently spreads the risks but also promote trade and commerce by utilizing the fund.

There are different insurance policies in Nigeria which you can subscribe to depending on your specific needs.

Types of Insurance in Nigeria

Here are the main insurance policies in Nigeria:

1. Personal Insurance

The personal insurance includes insurance for human life which may suffer a loss because of death, accident, and disease.

Therefore, personal insurance is further sub-classified into life insurance, personal accident insurance, and health insurance.

Personal insurance differs from other insurance in the sense that, here, the subject of insurance is the life of a human being.

The insurer will pay the fixed amount of insurance at the time of death or at the expiry of a certain period.

At present, personal insurance enjoys maximum scope because life is the most important property of an individual.

Every person requires insurance.

This insurance protects the family at the premature death or gives an adequate amount at the old age when earning capacities are reduced.

Under personal insurance, a payment is made at the accident.

The insurance is not only a protection but is a sort of investment because a certain sum is returnable to the insured at the death or the expiry of a period.

2. Property Insurance

Under the property insurance property of person/persons is insured against a certain specified risk.

The property of an individual and of the society is insured against loss of fire and marine perils, the crop is insured against an unexpected decline in deduction, unexpected death of the animals engaged in business, break-down of machines and theft of the property and goods.

3. Fire Insurance

Fire insurance covers the risk of fire.

In the absence of fire insurance, the fire waste will increase not only to the individual but to the society as well.

With the help of fire insurance, the losses arising due to fire are compensated, and the society is not losing much.

The individual is preferred from such losses and his property or business or industry will remain approximately in the same position in which it was before the loss.

The fire insurance does not protect only losses, but it provides certain consequential losses.

Also, war risk, turmoil, riots, etc. can be insured under this insurance, too.

4. Marine Insurance

Marine insurance provides protection against the loss of marine perils.

The marine perils are; collision with a rock or ship, attacks by enemies, fire, and captured by pirates.

These perils cause damage, destruction or disappearance of the ship and cargo and non-payment of freight.

So, marine insurance insures ship, cargo and freight.

5. Liability Insurance

The general insurance also includes liability insurance whereby the insured is liable to pay for the damage of property or to compensate for losing persona; injury or death.

This insurance is seen as fidelity insurance, automobile insurance, and machine insurance, etc.

6. Social Insurance

The social insurance is to protect the weaker sections of the society who cannot pay the premium for adequate insurance.

Pension plans, disability benefits, unemployment benefits, sickness insurance, and industrial insurance are the various forms of social insurance.

7. Guarantee Insurance

The guarantee insurance covers the loss arising because of dishonesty, disappearance, and disloyalty of the employees or the second party.

The party must be a party to the contract.

His failure causes loss to the first party.

For example, in export insurance, the insurer will compensate for the loss at the failure of the importers to pay the amount of debt.

Top 8 Insurance Companies in Nigeria

These are the registered insurance companies that presently provide the best financial coverage to Nigerians.

8. Coronation Insurance Plc.

Coronation Insurance Plc. are a leading Nigerian insurance group offering a diverse range of products and services covering life, general and special risk businesses, licensed to underwrite all classes of insurance, such as fire and special perils, goods-in-transit, all risk insurance, etc.

This company offer superior customer service, innovative product solutions, excellent financial advice to help grow your business and achieve your goals.

Product and Services

• Asset Management
• Registrars and Data Management Services
• Investment Banking
• Securities Trading and Brokerage Services
• 9-12 Amodu Ojikutu Street, off Saka Tinubu Street, Victoria Island, Lagos, Nigeria
• +23412774500, +2347099821284
• [email protected]

7. Consolidated Hallmark Insurance Plc.

Consolidated Hallmark Insurance (CHI) Plc is a leading general business insurance company determined to change the way Nigerians see insurance.

The company’s primary aim is to deliver exceptional service to customers.

You are covered from motor insurance to gadget insurance, home insurance to business insurance and everything in between.

• Motor 3rd Party
• Travel Insurance
• Marine Insurance
• Oil and Gas
• Motor Comprehensive
• Machinery Breakdown
• Contractors-All-Risk
• Motor 3rd Party Fire and Theft
• Money Insurance
• Plant-All-Risk
• Home Insurance
• All Risks Insurance
• Bonds Insurance
• Burglary Insurance
• Consequential Loss
• Personal Accident
• Fire and Special Perils
• Professional Indemnity
• Combined Fire and Burglary
• Goods-In-Transit
• 266, Ikorodu Road, Obanikoro, Lagos.
• [email protected]
• +234 1 2912543, +234 1 2912532

6. Cornerstone Insurance Plc.

Cornerstone Insurance Plc. was incorporated on 26 th July, 1991 as a private limited liability company and became a Public Limited Liability, quoted on the Nigerian Stock Exchange in 1997.

The organization was established to conduct insurance business in a professional, ethical and customer-focused manner and has remained committed to these values over the years.

The company is licensed and re-certified by the National Insurance Commission (NAICOM) to do both general and life businesses.

The classes of insurance business currently undertaken include:

• Motor Vehicle
• Engineering All Risks
• Asset Protection
• Liability to Third Party
• Credit Life
• Mortgage Protection
• Term Assurance
• Wealth Creation Products
• Takaful (Islamic Insurance)

Cornerstone remains committed to both their core values of integrity, empathy, professionalism, innovation, and team spirit and continued mission of delivering value beyond expectations through needs-based products and quality service

Cornerstone Insurance Plc. Is the first insurance company in Nigeria to provide customers with an online platform for insurance transactions.

Services provided are technology driven by innovative insurance applications.

These services are accessible with ease through the internet and/or mobile technology.

Head Office

• 21, Water Corporation Drive, off Ligali Ayorinde Street, Victoria Island, Lagos, Nigeria
• [email protected] (Sales Enquiries and Support)
• [email protected] (Corporate Enquiries, Feedbacks and Complaints)
• [email protected] (Claims Lodgment, Enquiries and Complaints)

Telephone Numbers:

• 07086216957 (Sales Enquiries and Support)
• 01-2806500 and 0700 267 63778663 (Corporate Enquiries, Feedbacks and Complaints)

5. Custodian and Allied Insurance

Custodian Investment Plc. is a leading Nigerian Investment Group with operations in the other financial services sector of the economy.

Custodian Investment Plc. is managed by a Board comprising thoroughbred professionals with proven track records in their various fields of endeavour, who bring deep insights derived from several years of fruitful and eventful years of experience to bear on the direction of the company.

Currently, with group-wide assets under management (AUM) over $1.1 billion, the company remains committed to continuous improvement of its businesses, structures, systems and processes in order to keep ahead of the challenges of new growth, improving business prospects, transparency, and governance.

• General Insurance

Auto Insurance

• Home Shield
• Fire Insurance
• Life Insurance
• Savings and Investment
• Endowment Plan
• Protection Plan
• 16A, Commercial Avenue, Sabo, Yaba, Lagos
• (+234)12774000-9
• [email protected]

4. NEM Insurance Plc.

NEM Insurance Plc. started the insurance business in Nigeria in 1948 through the agency of Edward Turner and Co.

The company, which has contributed immensely towards the growth of the insurance industry in Nigeria, has expanded its operations into the West African subregion.

The company’s mission is to build a customer satisfying insurance institution that is passionate about adding value to the interests of all stakeholders.

Corporate Products

• Motor Insurance (Corporate)
• Aviation Insurance
• Engineering Insurance
• Computer and Electronics Policy
• Fidelity Guarantee
• Group Personal Accident

Personal Products

• Goods In Transit
• Fire and Special Perils Insurance
• Motor Insurance
• Home Protection
• Enhanced Motor Third Party

SME Products

• Product Liability
• Cash In Transit
• Agricultural Insurance
• 199, Ikorodu Road, Obanikoro, Lagos
• [email protected]
• 234-1-4489560, 234-1-4489570

3. Leadway Assurance Company

Leadway Assurance Company Limited is one of Nigeria’s foremost insurance service companies, with a reputation for service efficiency and customer reliability.

For over 45 years, Leadway has honored its underwriting commitments and has earned its reputation of excellence in claims handling.

The evolution of Leadway since 1970 has mirrored the dramatic expansion of indigenous insurance service providers, with Leadway remaining in the forefront as an insurer of repute.

The reputation enjoyed today by Leadway has been attained by the continuing pursuit of improvements to maintain competitive advantage.

All aspects of the business are approached with discipline; the recruitment of staff, the development of products, the advancement of technologies and the personal service offered to each client.

Personal Insurance

• Health and Life
• Savings and Investments
• Annuities and Pension
• Property Insurance

Business Insurance

• Accident Policies
• SME Insurance
• Comprehensive
• Third Party (Scratch Card)
• Third Party
• Third Party (Auto Base)
• [email protected]
• (+234) 01-2700700

2. AXA Mansard Insurance

AXA Mansard Insurance Plc. was incorporated in 1989 as a private limited liability company and is registered as a composite company with the National Insurance Commission of Nigeria (NAICOM).

Products range from life to property and casualty for individuals, commercial solutions for SMEs and corporate organizations.

AXA Mansard Insurance Plc. is rated B+ by A.M. Best (2016) for Financial Strength.

The company is also certified ISO 9001:2008, compliant by the Standard Organization of Nigeria (SON) for quality management systems.

AXA Mansard Insurance has a 24hour dedicated customer interface team which handles the resolution of customer enquiries and complaints.

• Health Insurance
• Partnerships
• Plot 1412, Ahmadu Bello Way, Victoria Island, Lagos, Nigeria

Phone Number

• 0700AXAMANSARD
• *987# (USSD Code)
• [email protected]
• [email protected]
• [email protected]
• [email protected]

1. AIICO Insurance Plc.

Established in 1963, AIICO Insurance Plc. is a financial services group with market-leading positions in its key business lines: Insurance, Health Maintenance and Asset Management.

As an insurance company, AIICO’s goal is to be the insurer of choice and the leading insurance company in Nigeria – providing life insurance and retirement services as well as risk underwriting to a substantial and diversified client base, which includes corporations, financial institutions, governments and individuals in Nigeria.

AIICO is the market leader in retail life insurance, retirement services and non-life insurance in Nigeria.

Their leading insurance asset management and health management businesses complement the core insurance franchise.

AIICO also owns valuable financial and strategic assets, including a controlling stake in Multishield Limited, and a 19% stake in Healthcare International Limited, and AIICO Capital Limited.

• Annuity Plan
• Auto Insurance Plan
• Investment Plan
• Personal Accident Plan
• Home Insurance Plan
• Travel Insurance Plan
• Pure Risk Plan
• Manufacturing Insurance
• Agric. Insurance
• General Business Plan
• Plot PC 12, Churchgate Street, Victoria Island, Lagos
• 01 279 2930, 0700 2442 6682 28
• [email protected]

8 Best Insurance Companies in Nigeria

List of top insurance companies in Nigeria to join today.

• AIICO Insurance Plc.
• AXA Mansard Insurance
• Leadway Assurance Company
• NEM Insurance Plc.
• Custodian and Allied Insurance
• Cornerstone Insurance Plc.
• Consolidated Hallmark Insurance Plc.
• Coronation Insurance Plc.

Best Insurance Company in Nigeria?

The best insurance company in Nigeria to join and secure yourself against potential risks is AIICO Insurance Plc.

AXA Mansard Insurance is the closest competition.

Insurance is a sure way to enjoy financial security, no matter what life throws at you, your loved ones, or cherished possessions.

Choosing the right insurance company in Nigeria can be difficult because of the various competing options available in the market. That’s why this post was written for you.

Some of these insurance companies require you to meet certain criteria before your application can be approved, while some don’t.

So, it’s impossible to tell you categorically which among them will accept you immediately.

I spent several hours researching each company on this list, so you can trust the integrity of the content.

Hope you enjoyed this article?

If you know any insurance company that is equally a good option or shouldn’t be on this list, please let us know in the comment section.

Tell us the company and why it is excellent or bad for Nigerians.

READ ⇒  5 Affordable HMO in Nigeria to Subscribe for Health Insurance Today ▷ 99% Reliable

Saint Chinedu

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Top Insurance Companies in Nigeria and what they offer

You’re considering getting insurance, but you’re not sure which company to choose. You’ve heard a lot of good things about insurance companies in Nigeria, but you don’t know which one is right for you.

Don’t worry, we’re here to help. In this article, we’ll introduce you to the top 7 insurance companies in Nigeria and help you decide which one is right for you.

What Is Insurance?

When you think of insurance , what comes to mind? For most people, insurance is all about risk. You’re protecting yourself against the possibility of something bad happening.

But insurance is about more than just risk. It’s also about protection. When you have insurance, you’re not just protecting yourself; you’re also protecting your family and your assets.

Insurance is about peace of mind. It’s about knowing that you’re covered no matter what happens. And it’s about knowing that you and your loved ones are taken care of in the event of a crisis.

What are the Challenges of Insurance in Nigeria?

It’s no secret that the insurance industry in Nigeria is riddled with challenges. Here are seven of the most pressing ones:

• Limited penetration: Insuring a car or home is still not a common practice in Nigeria, which limits the growth of the industry.
• Lack of trust: Many Nigerians don’t trust insurance companies, which is due in part to a few bad actors in the industry.
• High premiums: Because of high risk and low penetration, insurance premiums are often quite high, making it difficult for people to afford them.
• Lack of regulation: The insurance industry in Nigeria is not well regulated, which leads to a lot of mistrust among consumers and companies alike.
• Low literacy rates: A large percentage of Nigerians lack basic literacy skills, making it difficult for them to understand insurance policies and terms.
• Poor infrastructure: The infrastructure for delivering insurance services is woefully inadequate, which leads to long wait times and low customer satisfaction rates.
• Fraud: Fraud is rampant in the Nigerian insurance industry, costing companies millions of dollars every year.

The Top 7 Insurance Companies in Nigeria

There are many insurance companies in Nigeria, but only a few of them are truly worth your time.

Here is a list of the top 7 insurers in the country, along with a brief description of what they do:

Prudential Zenith Life

Prudential Zenith Life insurance company offers life, health, and property insurance products.

 AXA Mansard

AXA Mansard is a general insurance company that offers coverage for cars, homes, businesses, and more.

Leadway Assurance

Leadway is a specialist Personal insurance and Business insurance.

Leadway’s Personal insurance includes:

• General Insurance
• Travel Insurance
• Life and Health Insurance
• Savings and Investments

Leadway’s Business insurance includes:

• Automobile Insurance
• Property Insurance
• Marine Insurance
• SME Insurance
• Accident Protection Insurance

Regency Alliance Insurance PLC

Regency Alliance Insurance PLC offers both life and general insurance products.

Custodian and Allied Insurance Limited

Custodian and Allied Insurance Limited specializes in health and travel insurance products.

 Standard Trust Assurance

Standard Trust is another general insurer that offers coverage for all sorts of risks.

Nicon Insurance

Nicon Insurance is one of the oldest insurance companies in Nigeria and offers a wide range of services, including life insurance.

What are the Benefits of Having Insurance?

You might be wondering, what are the benefits of having insurance?

Here are 12 of them:

• Protection from unforeseen events
• Security in the event of an accident
• Peace of mind
• Tax benefits
• Cover for personal injuries
• Cover for property damage.
• Protection against financial loss
• coverage for medical expenses.
• Travel risk insurance
• Coverage for legal expenses
• Protection against death and disability
• Retirement planning

What are the Different Types of Insurance in Nigeria?

There are basically five main types of insurance:

1. Health Insurance

This type of policy covers you and your family against medical bills and other health-related expenses.

2. Life Insurance

This policy pays out a lump sum to your beneficiaries in the event of your death.

3. Vehicle Insurance

This type of policy covers you for damage incurred to your vehicle in the event of an accident.

4. Home Insurance

This policy covers your home against damage in the event of a fire, storm, or burglary.

5. Travel Insurance

This kind of policy protects you from things like missed flights or lost luggage that happen while you’re traveling.

How to Choose the Right Insurance Company in Nigeria

When it comes to choosing the right insurance company in Nigeria, there are a few things you need to consider.

First of all, you need to decide what type of insurance you need. There are many different types of insurance policies available, so it’s important to pick the one that’s right for you.

Next, you need to do your research and compare different insurance companies. There are many different insurers out there, so it’s important to find one that provides the coverage you need and at a price you can afford.

Finally, you need to contact the insurance company and ask for a quote. This will give you an idea of how much the policy will cost each year.

Once you’ve considered these three factors, you should be able to choose the right insurance company in Nigeria for your needs.

Frequently Asked Questions About Insurance in Nigeria

Here are some of the most frequently asked questions about insurance in Nigeria:

1. What is the difference between life and health insurance?

Life insurance covers the policyholder in the event of their death, while health insurance covers the policyholder in the event of them becoming ill or injured. Health insurance can be either private or public, while life insurance is always private.

2. What are the different types of insurance available in Nigeria?

There are many different types of insurance policies available in Nigeria, including life, health, car, and home insurance. You can buy a policy from a local insurer or one that is based in another country.

3. What is the purpose of insurance?

The purpose of insurance is to protect individuals and businesses from potential financial losses. Insurance companies offer a variety of policies that cover different types of risks, such as property damage, liability, and medical expenses. Individuals can purchase insurance policies to protect themselves from the financial impact of unexpected events, such as car accidents or home damage. Businesses can use insurance to protect themselves from the financial consequences of lawsuits or other types of losses.

4. How does insurance work?

Insurance works by protecting policyholders from financial losses in the event of an accident, fire, theft, or other covered event. The insurance company agrees to pay the policyholder a set amount of money, called the premium, in exchange for the policyholder’s agreement to pay the insurance company a set amount of money, called the deductible, in the event of a covered loss. If the policyholder does not have enough money to pay the deductible, the insurance company will not pay the claim.

5. Why do people buy insurance?

There are a number of reasons why people buy insurance. Some people purchase insurance to protect themselves and their families in the event of an unexpected death or injury. Others buy insurance to cover their homes or businesses in the event of a disaster. Still, others purchase insurance to help cover the cost of medical care or other expenses if they become sick or injured.

Insurance can also provide peace of mind for people who are worried about the possibility of losing their homes, their businesses, or their loved ones. For many people, insurance is an important way to protect their assets and their families.

6. How can I get insurance?

There are many ways to get insurance. The most common way to get insurance is through an insurance company. There are many different insurance companies, and each offers different types of insurance. Some insurance companies sell only one type of insurance, while others sell multiple types of insurance.

Another way to get insurance is through a government program. The most common government program that provides insurance is Medicare. Medicare is a health insurance program for people who are 65 years of age or older or who have certain disabilities.

Some employers also provide insurance for their employees. This is usually done through a group insurance plan. Group insurance plans are usually less expensive than individual insurance plans.

You need to make sure you have the right insurance company to protect your business. Listed above are the top 7 insurance companies in Nigeria from our research. Thanks for reading.

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How to make a business plan for an insurance company?

How to make a business plan for an insurance company? If you are about to launch an insurance company, now is the time to find out how to make an insurer’s business model . Nowadays it doesn´t matter what niche a company is in since all of them can put together their business plan from a template that may change according to the goals of every one of them.

But before starting with the entire business plan process, it will be essential that you acquire an insurance license that regulates the insurance industry in the country where you are located. You can find information on how to get this license online.

In this post, we want to focus on how to develop a business plan for your insurance company, and we will do it step by step. 

Business plan: What does it take to open an insurance agency?

An insurance company must be 100% ready to face any challenge that may arise. Therefore, a business plan will be the most practical option to be able to fulfill the company´s goals and the established financial requirements.

This would be the template you should follow if you want an effective insurance company strategic plan: 

Consider the industry´s overview 

The insurance area turns out to be very wide. So, to start in this market, you need to be aware of several things. Likewise, to start with an insurance company you must determine in which area you´ll specialize, although you could also start with an insurance company in general.

There are insurance companies that sell policies that cover life, liability, cars, and much more. 

Make an executive summary

The executive summary should state what you are looking for when you have an insurance company today, and what you expect from it in the future. It should also show what your approach is when working in the insurance sector. For example, the strategic end of an insurance company must be clear to position itself and in turn offer a diverse range of products for the target audience.

So, if you have this same mindset, we are on the right track. Anyway, in this executive summary, it is necessary to make clear what standards will be held to meet the customer’s needs.

Show products and services 

It´s important to highlight what services you can offer as an insurance company. In this way, you can profit in the market that is taken by this sector, and in turn, you will be able to achieve your purposes and business goals.

Your products of offers and services could be formed from the following examples:

• Health insurance policy.
• Life insurance policy. 
• Auto insurance policy. 
• Pet insurance policy. 
• Aviation insurance policy. 
• Agricultural insurance policy. 
• Property and casualty insurance policy. 
• Inland marine insurance. 
• Advisory services regarding insurance plans. 

Set the vision and mission of the company

What is the vision of your insurance company? This point is usually important for any business plan. In the case of an insurance company, the idea is to offer a wide variety of products and services at an affordable price. Another important point within the mission will be to be one of the main insurance companies in your country.

These are very clear ideas that have worked for the most prestigious insurance companies today. Similarly, both the vision and mission of your company depend on the established goals.

Show your commercial structure 

The consolidation of the vision and mission will depend mostly on the business structure of the insurance company. When you have a strong structure in place, it can add significant growth to your business.

Then again, to become a leading brand in the insurance market, the most appropriate thing is to have a commercial structure such as the one mentioned below so that each one fulfills an optimal function:

• Executive Director.
• Legal secretary.
• Head of claims.
• Head of collections.
• Human resources administrator or manager.
• Marketing executive.
• Accountant.
• Customer service staff.
• Reception officer. 

Carry out the SWOT analysis

These are the elements that make up the SWOT analysis: 

• Strength An insurance company must have team power as a central force since they must have the ability to meet the needs of their clients to add value to their money. When a business is well-positioned it can easily attract a greater number of customers. The insurance service should not be interrupted for it to be of quality, which is why today many companies have a fully customized software application so that communication with the client is continuous.

• Opportunities In the insurance industry, there are many opportunities, it´s important to be prepared to take advantage of them by offering various insurance packages and policies.
• Threat When an economy is weak there can be many limitations to the insurance sector. When investing in a certain business, certain risks are being taken, and that is why risk assessments must be carried out within the business plan to create strategies that allow staying afloat in this highly competitive industry.

Do a market analysis 

In the market analysis, several elements that will be a great determinant for the success of your insurance company must be considered: 

Market trends 

This type of practice has many benefits since, depending on the inconveniences that may arise in the insurance sector, the survival chance of the smaller insurance companies is usually very low. Consequently, it is very rare these days to get an insurer that does not have multiple insurance coverages for sale.

The regular payment of premiums is another of the most visible characteristics for the survival of this type of business, so they must implement systems that allow the collection of premiums to the holders easily. If you have looked at the particularities of the most successful insurance companies, you will surely notice that they take much advantage of the tools offered by the internet.

Target market 

Depending on the goals of having a company dedicated to this sector in the future, it can acquire more companies to expand the sales of its products. By adding a wide variety of products and services, your target market can be expanded significantly.

Your target market can encompass the following groups of people or organizations:

• Young adults.
• Companies and entrepreneurs.
• Corporate organizations.
• First-class companies.
• Manufacturers and distributors.
• Sports organizations.
• Real estate owners.
• Research companies. 

Competitive advantage 

In this way, you can be ready to compete with other insurance companies regardless of whether they are small or leaders.

It does not matter if you are a beginner in this industry, if you have a highly professional team with insurance licenses and are highly qualified, this will be a great competitive advantage. 

Develop a sales and marketing strategy

Insurance companies must be ready to spend a significant amount of money on marketing, and in the marketing department for a good promotion of their products. Just the same through advertising, they must offer innovation to attract the attention of the target audience.

The marketing plan of an insurance company must be based on reliability , and for this, it will be necessary to have a team that can connect with its clients positively so as not to hinder their growth in this industry.

To market your products and services taking into account marketing strategies, these will be some of the most useful platforms:

• Presentation Letters.
• Advertising the business in trade magazines.
• Make use of local directories for your company’s listing.
• Attend seminars and exhibitions for the sale of your insurance policies and establish better contacts. 
• Make leverage online to promote your insurance company.
• Hire the services of marketing experts to improve the marketing of your products and services. 

Have a sales forecast

That is why to make the sales plan of an insurance company you must have in mind the information collected from the analyzes that you have already done previously. In the same way, your sales projection must be in accordance with the location of your company, with the products and services it offers, and with what you want to obtain in the middle of this industry.

To do this, you must keep track of your sales projection for the first year , second year, third year, and so on. 

Within the insurance sales plan forecast, you must also think of two very important elements :

Price strategy 

There is an established trend in setting prices in the insurance industry. 

In general, this math is made by experts in the insurance industry and although there are price standards related to coverage.

One of the best options to enter the market is to sell your products a little below the average price that we find in the industry. 

Payment options 

These are some of the payment options that can be made available to the client: 

• Bank transfers.
• Online bank transfers.
• Bank drafts.
• Mobile money platforms.

Make projections regarding the financial part and costs

• Total fee for the incorporation of the business.
• Budget for insurance policies (permits, licenses, …).
• Cost of office equipment (computers, furniture, printers, security devices, fax machines, much more).
• Website launch cost.
• Budget to hire a specified number of employees. 
• Everything related to the installation of the office or its reconstruction. 
• Capital base.
• Additional expenses (cards, promotions, signage, advertisements, etc.). 

Develop a sustainability and expansion strategy

The idea is that you can keep the constant sale of your insurance policies to generate constant income for the organization. That is why the sustainability and expansion strategy must focus on hiring competent employees, maintaining a pleasant work environment, and providing benefits to all staff .

Regarding expansion within the business plan, the goal may be to merge with other companies or acquire another company that allows you to have more market share. 

Did you like this post?

A business plan is more important than you can imagine because it is the only way you can maintain an established marketing strategy and more assertive projections.

At BluCactus we have a team of certified professionals, and we can help you create the business plan your insurance company needs.

Contact Us ! And we will gladly assist you. Also, i f you want to keep up with the world of digital marketing, you can also subscribe to our weekly newsletter.

Quote your project to let us create your Marketing Project to increase your audience and sales today!

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Top 20 Insurance Companies in Nigeria 2023

Updated on August 8, 2023

Insurance can be an unseen shield that protects you from life’s unforeseen circumstances. As Nigeria continues to grow and evolve, so too do the insurance companies that serve its people. From major players to up-and-coming providers, these insurance companies in Nigeria offer a range of options to help keep individuals, families, and businesses secure.

A world where uncertainties are met with a reassuring nod, where the unexpected is met with a knowing smile – all thanks to the protective shield of a reliable insurance company by your side.

We’re about to unveil the rock stars of risk management, the champions of coverage, and the custodians of your well-being. Join us as we shine a spotlight on the top insurance companies in Nigeria, each with its unique offerings, tailored to shield you and your loved ones from life’s curveballs.

We’ll walk you through the what, why, and how, ensuring that you’re armed with the knowledge to make informed decisions that safeguard your future.

So, fasten your seatbelts as we journey through this landscape of financial security because when it comes to protecting what matters most, these insurance powerhouses have got your back.

In this article, we’ll take a closer look at the insurance landscape in Nigeria, exploring the different types of insurance companies in Nigeria available, the crème de la crème of insurance companies, so you can decide which one fits your needs, and the benefits they offer.

But first, let’s talk more about what insurance is.

What is Insurance?

Insurance is a valuable service that protects you, your business, and your family from unseen disasters. However, as much as you may not want these occurrences to occur, you will be unable to prevent them, which is why they are said to as unexpected.

The good news is that, whenever they occur, insurance promises to cover you.

Best Insurance Companies in Nigeria

Here is a list of the top and best insurance companies in Nigeria for anyone:

1. AXA Mansard Insurance

AXA Mansard Insurance is an insurance company headquartered in France. AXA Mansard is a member of the AXA Group.

With approximately 160,000 workers, they are one of the world’s largest asset management and insurance companies.

Also, they service around 107 million customers in over 60 countries.

Axa Mansard Insurance is one of the top insurance companies in Nigeria that provides health insurance, life insurance, motor insurance, travel insurance and other insurance products like SMEs insurance, personal insurance, accident insurance, fire & Engineering insurance as well as Aviation & Energy insurance.

2. FBN Insurance

The First Bank of Nigeria has a subsidiary called First Bank of Nigeria Insurance. FBN Insurance has been one of the top insurance companies in Nigeria for some time now. It specializes in providing insurance.

FBN Insurance is primarily a life insurance company that provides coverage to both people and businesses. They have both retail and corporate insurance plans.

FBN provides Insurance products that help you enjoy the peace of mind that comes with being able to manage daily threats.

3. Nicon Insurance

Nicon Insurance is another insurance company in Nigeria that specializes in providing insurance that protects you and all that matters to you the most.

NICON is a significant insurance company in Africa. They were technically owned by Nigeria’s Federal Government in order to help the country’s insurance market expand.

They were, however, privatized in 2005. They have branches in each of the 36 states that make up Nigeria.

Nicon Insurance provides a range of insurance policies to match your specific insurance requirements.

Like special product insurance, fire insurance, motor insurance, travel insurance, marine insurance, personal insurance, general accident insurance, Aviation insurance, oil& gas, Reinsurance, pension and car engineering insurance.

Nicon Insurance is definitely one of the top insurance companies in Nigeria and you should definitely try them

4. Sovereign Trust Insurance Plc

Sovereign Trust Insurance Plc is an insurance company based in the United Kingdom. Following a reorganization as the Grand Union Assurance Limited, Sovereign Trust began operations in 1985.

They have a branch network all around the country that use to function. Sovereign Trust specializes in a comprehensive variety of products and services that are designed for specific requirements.

This is one of the renowned insurance companies in Nigeria that offers family well-being insurance, motor insurance, oil & gas insurance and marine insurance.

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5. Standard Alliance Insurance Company Limited

Standard Alliance Insurance Company Limited is a financial institution based in the United Kingdom. Standard Alliance is a well-known tech and customer-focused insurance company in Nigeria.

Because of their great delivery of products and services, they are among the best and most regarded in the insurance market.

Standard Alliance Insurance engages in all types of insurance, including general and specific risks. Like home insurance, and personal and business insurance.

6. Royal Exchange Insurance Company

Royal Exchange Insurance Company (REGIC) is another top insurance company in Nigeria. The Royal Exchange name is well-known in Nigeria’s financial market, particularly in the insurance industry.

Royal Exchange Plc formed a group structure in 2008 in order to carry out its vision for the financial industry. In general, Royal Exchange Insurance specializes in the non-life insurance business in Nigeria.

This is one of the top insurance companies in Nigeria offering general insurance, health insurance, and life assurance.

7. Leadway Assurance Company

Leadway Assurance Company is another one of the top insurance companies in Nigeria providing insurance services.

Leadway Assurance was founded in 1970 and has been operating in the insurance industry ever since. They specialize in commercial, life, auto and retirement insurance. They also provide ancillary financial services. Portfolio management, credit bonds, and miscellaneous and financial losses are all included.

Leadway Assurance is one of the most respected insurance companies in Nigeria you can find and definitely suitable for most people’s needs.

8. AIICO Insurance Plc

AIICO Insurance Plc is an insurance company based in the United Kingdom. It is also a leading player in the Nigerian insurance market. They founded this company in 1963 and have since risen through the ranks of the insurance industry to become one of the top companies.

AIICO Insurance Plc also concentrates on Financial Services, Life Insurance, Special Liabilities Insurance, Health Insurance, Wealth Management, and Retirement Benefits Management.

This is one of the most popular if not the most popular insurance companies in Nigeria. They’ve been around since like forever and can offer all types of coverage.

9. African Alliance Insurance Plc

African Alliance Insurance Plc is a company that provides insurance to Africans. On May 6, 1960, African Alliance Insurance plc was founded. In the field of Life Assurance, the insurance plc organization has a reputation for being efficient and trustworthy.

Furthermore, they customize their insurance policies to each stage of their consumers’ life. They provide the following insurance policies; a guaranty scheme for annuities, and life and property insurance.

Because of African Alliance Insurance’s strong specialist life assurance services, it is seen as one of the top insurance companies in Nigeria.

10. Lasaco Assurance Plc

Lasaco Assurance Plc is a company that provides insurance. The Companies Decree of 1968 was used to form Lasaco Assurance Plc on December 20, 1979. The company was known as Lagos State Assurance Company Limited at the time.

On July 7, 1980, they were licensed as an insurer and began operations on August 1, 1980. They provide the following insurance policies: automobile insurance, flight insurance, marine insurance, and insurance against accidents or fire outbreaks.

11. Custodian & Allied Insurance Plc

Custodian & Allied Insurance Plc is one of the most recognised insurance companies in Nigeria as it is active on the Nigerian Stock Exchange.

Custodian & Allied Insurance offers insurance and reassurance solutions for life and non-life cover.

Custodian & Allied Insurance Plc offers insurance products and services like cover motor insurance, travel insurance, general insurance, life insurance, proper insurance, marine cargo and hull-to-fire/special perils insurance, business interruption, occupiers liability, healthcare professional indemnity insurance, and trustees owners and personal all risks insurance.

12. Heirs insurance

Heirs Insurance is one of the best general insurance companies in Nigeria as it challenges traditional insurance by positioning itself as the top digital insurer in the country by providing simple and accessible insurance plans and protection for vehicles, homes, businesses and more.

Some of Heirs insurance plans include motor insurance, travel insurance, goods-in-transit insurance, insurance, homeowner insurance, tenant insurance, marine cargo and hull-to-fire/special perils insurance, biker interruption, and personal accident insurance.

13. IEI Insurance

IEI Insurance or International Energy Insurance Plc is a motor focus insurance company in Nigeria

IEI Insurance offers private and commercial vehicle insurance as well as motorcycle insurance. IEI Insurance has a third-party insurance portal where anyone, an agent or yourself can buy any of their insurance products.

This portal lets you manage all your policies in a single view, schedule your policies for renewal and before they expire, view all your payments history and track their status.

14. NSAI Insurance

NSIA Insurance is a subsidiary of Groupe NSIA, It is regarded as one of the top Insurance companies in Nigeria because of its customer-centric culture.

NSIA Insurance has made it its obligation to pay claims on all classes of business insurance within 48 hours as long as there’s a receipt of the signed discharged vouchers. And to also achieve a Customer Satisfaction Index of 90% alongside an Employee Satisfaction Index of 90%.

NSIA Insurance products include personal insurance, agric insurance, business insurance, motor insurance, life assurance, homeowner insurance, travel insurance, health insurance, and energy and special risk insurance

15. Cornerstone Insurance

Cornerstone Insurance Plc was launched in 1991 and is currently quoted on the Nigerian Stock Exchange.

Cornerstone Insurance is one of the most recognised insurance companies in Nigeria because of its ethical and professional conduct, coupled with customer-focused values.

Cornerstone is licensed and re-certified by the National Insurance Commission (NAICOM).

Cornerstone Insurance products include Motor Vehicle insurance, Aviation insurance, Marine, Engineering All Risks, Asset Protection, Liability to Third parties, Oil & Gas Insurance, Group Life, Credit Life, Mortgage Protection, Term Assurance, Wealth Creation Products and Takaful (Islamic Insurance).

Cornerstone’s Authorized Share Capital is N7.5 billion while its Market Capitalization is N5 billion respectively.

16. Allianz Nigeria Insurance Plc

Allianz Nigeria Insurance is one of the top insurance companies in Nigeria because of its much-known work to make insurance less complex and more simple for everyday Nigerians.

Allianz prides itself as a composite Insurance company dedicated to the Life and Non-Life Insurance business in Nigeria with over 30,000 customers.

Allianz insurance products include Motor insurance, Life insurance, Home Insurance, travel insurance, Group Life Assurance, Burglary Insurance, Group Personal Accident Insurance and Fidelity Guarantee.

17. Coronation Insurance – Wapic Insurance

Wapic Insurance now called Coronation Insurance was founded in 1985 and is another one of the popular insurance companies in Nigeria.

Other than insurance services, Coronation also offers other services that include asset management, private banking, trustees and registrar services as well securities trading and brokerage services.

Coronation insurance offers comprehensive insurance products for your car, home, business, life, investment, yacht, and marine.

18. Tangerine Life Insurance

Tangerine life insurance is of the most popular life insurance companies in Nigeria and arguably Africa.

Tangerine is actually a financial app that lets anyone send and receive money , pay bills, track their expenses, access loans, save and protect (insure) the things that are important to them.

Tangerine Life insurance plan lets you pay a premium within your means that allows you to protect all you cherish.

The insurance companies listed above are definitely some of Nigeria’s top insurance companies in Nigeria you can find. You could go with any of these insurance companies in Nigeria and be certain that you’ll be in good hands.

What are Insurance companies?

An insurance company is a financial institution that offers a variety of insurance policies to protect individuals and businesses against the risk of financial losses in exchange for regular payments.

An insurance company works by sharing risks among a large number of policyholders.

See: Best HMO in Nigeria

What does an Insurance Company really do?

Insurance businesses or insurance companies sell coverage (insurance) to help protect you and your belongings from loss, theft, or damage. This is made possible by insurance firms spreading risk across a big group of people.

An insurance company ensures you receive financial support in the event of tragedy, crisis or accident, allowing you to bounce back and recover quicker.

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List of Top Insurance Companies Numbers

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Top 10 Insurance Companies in Nigeria And Their Coverage 2023

There are many top insurance companies in Nigeria which assist individuals who want to secure their future from the risk of uncertainty . However, you must know what you are looking for, how the insurance agency works, and how to choose the best one . There are several factors to consider before choosing insurance company in order to  this.

We all know that one of the reasons people buy insurance policies is for the protection of risk of unforeseen consequences at the occurrence of specific accidents insured against. However, Nigeria is not an exception.

Nigerian have seen that insurance helps protect them and their properties from the risk of an unfortunate events, hence the rise of insurance (companies) in Nigeria.

However, not minding the need to get an insurance policy, there are some factors you must put into consideration before buying an insurance policy.

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What Are the Factors To Consider Before Choosing An Insurer?

There are several factors that one must be mindful of when choosing an Insurer.

They are as follows:

1. The image of the company

You should always look up reviews and facts about the brand on the internet. This is due to the fact that the company’s history and track record should provide you with information about it’s up to and what insurance policy to go for.

2. Legal Certification

Your chosen insurance company must be legally recognized and accredited by the Nigerian government.

3. Policy Coverage

Before you buy an insurance from an insurance company, you must first of all know the policy which they offer. This is because, you are to choose what coverage that best suits your need. When you want to get your car insured, you don’t have to go for an insurer whose main coverage is homeowners. You just have to get with an auto insurance company for your safety.

4. Financial Stability and the Price Factor

It is good to learn how the insurance company performs during a bad economy and how this can affect you. Evaluate stock ratings and business resources to find the information you’re looking for. When searching for and ultimately selecting an insurance company, you may also want to consider price. In other words, if the price is reasonable, buy it. If it isn’t, look elsewhere.

The Top Insurance Companies in Nigeria 2023

1. aiico insurance plc..

AIICO Insurance Plc was established in 1963 as an insurance, pensions management, and asset management Group. However, It is known to be one of the country’s top insurance companies with its overwhelming features and Policy. AIICO Insurance Plc focuses mainly on general insurance and special risks, life assurance and annuities, health insurance, asset management, and pension administration.

AIICO Insurance Plc offer the following policies:

• Three payment plan
• Education investment plan
• Electronics equipment policy plan
• Income investment plan
• corporate saving plan
• Term assurance plan
• Travel insurance
• Flexible endowment plan

2. Lead Way Assurance company

LEADWAY provides services in both life insurance and pensions.

LEADWAY Assurance was established in 1970. It provides insurance services in the areas of general business insurance and life and pensions. In moreover, the company provides supplementary financial services such as secured credit, bonds, miscellaneous financial losses, and portfolio management. They are very active on various social media channels and have computerized the majority of their operations to increase steadiness and efficiency.

Lead Way Assurance company offers various insurance policies which includes the following:

• Lead way saving plan
• Family Benefit plan
• Money policy plan.
• Deferred annuity plan
• Personal saving plan
• Educational saving plan

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3. Custodian and Allied Insurance

Custodian and Allied insurance companies offer a huge number of insurance plans from which clients are given the options to choose. Each plan is customized to meet the needs of its clients.

Their policies includes the following:

• Immediate annuity plan
• Tuition protection plan
• Capital plan
• Auto insurance plan
• Investment plus plan
• Travel insurance plan

4.  Cornerstone Insurance Plc

Cornerstone Insurance Company was first formed as a private limited liability company on July 26, 1991, and it was later transformed into a Public Limited Liability Company and was listed on the Nigerian Stock Exchange (NSE) in 1997.

Cornerstone Insurance has held fast since its inception, putting their clients first and developing solutions that meet their needs. NAICOM, the National Insurance Commission, has licensed it to provide both life and general business insurance.

• Investment plan
• Gadget protection plan
• Marine insurance plan
• Motor insurance plan
• Annuity plan
• Goods in transit plan
• School fee guarantee plan
• Halal Takaful plan
• Life insurance plan
• Home insurance plan

5. AXA Mansard Insurance

AXA Mansard is known to be a subsidiary of the AXA Group. AXA Group is one of the top insurance companies in Nigeria and a  major player in both insurance and asset management. The company group  has maintained deligency serving  107 million customers in over 60 countries. Individuals and businesses in the country can rely on the company for life insurance and on-life insurance solutions.

• Student protection plan
• Life savings plan
• General ( business/ tourism) protection plan
• Money market plan
• Instant plan
• Retirement savings plan
• Equity income plan
• Autoflex plan
• Easy care plan
• Auto classic plan
• Health plan

6. African Alliance Insurance Plc

African Alliance Insurance plc. was founded on May 6, 1960.  The insurance Plc company is known for its efficiency and dependability in Life Assurance. Furthermore, the company has customize their insurance products to each stage of their clients’ lives.

• Group life assurance plan
• Investment assurance plan
• Individual assurance plan
• Annuity assurance plan
• Direct debit form plan

7. Goldlink Insurance Plc

This insurance company was founded on April 15, 1992, as a Private Limited Liability Company. It was later changed to a Public Limited Liability Company on May 11, 2007, and was listed on the NSE through an introduction on February 12, 2008. Goldlink Insurance Plc is authorized to conduct both life and general business. These plans include Motor Insurance, Fire and Special Perils Insurance, Oil & Gas Insurance, Life & Pension Insurance, and Travel Insurance.

They offer the following insurance policies which include:

• School Safety plan
• Compulsory Insurance plan
• General Accident plan
• Motor Insurance plan
• Reinsurance plan
• Marine & Aviation plan
• Group Life Insurance plan
• Oil & Gas plan
• Engineering Insurance
• Individual Life Insurance plan
• Liability Policies plan

8. Continental Insurance

Continental Insurance is the pan-African insurance industry’s private sector leader. The company offers its clients across the continent life and non-life insurance solutions.

• Business Insurance plan
• Auto Insurance plan
• Pet Insurance plan
• Insurance plan
• Home Insurance plan

9. Industrial and General Insurance Plc

the insurance company was formed as a private limited liability company on October 31, 1991. In 2007, the Company was incorporated as a public limited liability company. In January 1992, they began operations in Life and General insurance, as well as Pensions and Special Risks.

Industrial and General Insurance Plc provides customized insurance solutions to meet the specific needs of their clients.

• Group Life Products plan
• Aviation Insurance plan
• Health Insurance Plan
• Oil & Energy
• Engineering Insurance plan
• Marine Insurance plan
• Mobile Phone Insurance Plan
• General Business Insurance plan

10. Lasaco Assurance Plc

Lasaco Assurance Plc is one of the top 10 insurance companies in Nigeria which was established on December 20, 1979, in accordance under the Companies Decree of 1968. The company was known as Lagos State Assurance Company Limited at the time. They were eventually licensed as an insurer on July 7, 1980, and started operating as an insurance company on August 1, 1980.

• Aviation insurance plan
• Householder’s Insurance plan
• Personal accident plan
• Money insurance
• Fire and Special insurance plan
• Professional indemnity insurance
• Bond insurance plan

The above mentioned insurance companies are the top 10 best insurance companies in Nigeria which you can buy your insurance policy and feel safe.

Frequently Asked Questions – Top Insurance Companies in Nigeria

The most Frequently Asked Questions about insurance include:

What is the name of the first insurance company in Nigeria?

The first insurance company in Nigeria is the Royal Exchange Assurance Agency which was created in 1918 in the Nigeria’s insurance history.

However, African Insurance Company Limited was Nigeria’s first and the oldest indigenous insurance company. It began offering services in 1958.

What are the types of insurance companies?

They include the following:

• standard lines,
• Excess lines,
• Direct sellers,
• Mutual companies,
• Stock companies,
• Lloyds of London, and ETC.

How did insurance begin?

Insurance started a way little as a coffeehouse in the 17th century, patronized by bankers,  merchants, and insurance underwriters.

Is there health insurance in Nigeria?

Yeah of course, there is free health care available. This is provided through a special health insurance scheme for both government employees and private companies that enter into contracts with private health care providers.

What is NHIS in Nigeria?

This is an abbreviation for the National Health Insurance Scheme. It is an organization formed by the Federal Government of Nigeria under Act 35 of the 1999 constitution to help fund health care for Nigerians.

When did NHIS enter Nigeria?

It was first launched on June 6, 2005. The scheme has so far provided 4 million identity cards and registered and accredited 62 HMOs.

How can I register NHIS in Nigeria?

You can sign up and register online. Navigate to nhisonline.com.ng and click the ‘Register’ button. However, in order to register online, you must provide information such as your surname, NHIS number, and date of birth. You will be able to manage your account and view the information of your dependents in this manner.

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Nigerian Infopedia

Nigeria's Number One Online Information Hub

• Information

Top 10 Best Insurance Companies in Nigeria (2024)

by Mfonobong Daniel

Insurance not only provides peace of mind, but also some cash protection against unexpected accidents and other life dangers. Insurance can be purchased for a variety of reasons, including the desire to safeguard your family after your death or loss of earning ability or to secure your home, automobile, or other valuables in the event of theft or disaster.

• An insurance company is just a business that offers insurance.
• Insurance firms’ role is to assist their customers in risk management. Purchasing insurance from an insurance company entails shifting a portion of your financial risk to the insurance company. You will have to incur the financial risk if you are not covered.

When you buy insurance, you become the insured or the beneficiary. You pay the insurance company a fee known as a “premium” in exchange for the insurance company taking the risk on your behalf. You can file a compensation claim if you are involved in an accident that falls within the scope of the contract.

TABLE OF CONTENTS

TOP 10 INSURANCE COMPANIES IN NIGERIA

The following are the top ten insurance companies in Nigeria:

AFRICAN ALLIANCE INSURANCE COMPANY PLC

African Alliance Insurance plc, originally known as African Alliance Insurance Limited, was founded on May 6, 1960, with the support of Munich Reinsurance Company. They provide a unique blend of protection (Term Assurance and Group Life), savings, and investment products. They have the following plans available:

• Plan for direct debit
• Individual insurance policy
• Investment security scheme
• Annuity protection plan
• Group life insurance policy
• Esusu strategy

CONTINENTAL REINSURANCE COMPANY

Continental Reinsurance, which began as a private reinsurance company, was established in Nigeria in 1985. Continental Reinsurance is a composite reinsurer with a diverse business mix and customer base that provides both treaty and facultative life and non-life reinsurance. They have the following plans available:

• Plan for Home Insurance
• Plan for Pet Insurance
• Insurance policy
• Plan for Auto Insurance
• Plan of Business Insurance

GOLDLINK INSURANCE PLC.

Goldlink Insurance Plc was formed as a Private Limited Liability Firm on April 15, 1992, and was awarded a license to operate as a full-fledged insurance company on September 8, 1993.

Goldlink Insurance plc provides Life and General Business Insurance, which includes Fire and Special Perils Insurance, Motor Insurance, Life & Pension Insurance, Oil & Gas Insurance, Travel Insurance, and other services.

AIICO INSURANCE PLC.

AIICO stands for “American International Insurance Company,” which was established in 1963 as a subsidiary of American International Group (“AIG”). It began by providing life and general insurance services. In Nigeria, AIICO is the market leader in Retail Life Insurance and Retirement Services, as well as a market leader (top 3) in Non-Life Insurance. Life assurance and annuities, general insurance and special risks, health insurance, and asset management are AIICO’s main business lines.

AIICO provides the following services:

• Automobile Insurance
• Travel Strategy
• Homeowners Insurance
• Plan for Oil and Gas
• Agriculture insurance

CORNERSTONE INSURANCE PLC

Cornerstone Insurance, a Public Limited Liability Company, was formed as a Private Limited Liability Company on July 26, 1991. It was listed on the Nigerian stock exchange in 1997. They conduct the following types of insurance business: motor vehicle, aviation, marine, engineering risks, asset protection, third-party liability, oil and gas, group life, credit life, mortgage protection, term assurance, wealth creation products, and takaful (Islamic Insurance).

Cornerstone Insurance Plc. was named the ‘Best use of Technology, Insurance Firm, 2016, Nigerian Technology Awards’ as the first insurance company in Nigeria to provide customers with an online platform for insurance transactions.

LEADWAY ASSURANCE

Leadway Assurance Company Limited (‘LEADWAY’), formed in 1970, is one of Nigeria’s leading insurance service providers, known for its service efficiency and customer dependability. They provide general business insurance as well as life and pension insurance. They also provide Secured Credit, Bond, Miscellaneous financial losses, and Portfolio management services.

They provide the following insurance policies:

• Plan for Family Benefits
• Plan for Saving in the Lead
• Term insurance policy
• Plan your financial strategy.
• Savings strategy for education
• Personal financial plan
• Deferred annuity scheme

LASACO INSURANCE PLC

Lasaco Assurance Plc (previously known as Lagos State Assurance Company Limited) was founded on December 20, 1979, and began operations on August 1, 1980. Lasaco Assurance provides the following policies:

• Plan for marine insurance
• Bond protection scheme
• Insurance for money
• Indemnity insurance for professionals
• Plan for fire and special insurance
• Personal accident insurance
• Household Insurance Policy
• Automobile insurance policy
• Plan for aviation insurance

CUSTODIAN AND ALLIED INSURANCE

Custodian and Allied Insurance, or CAIL, is a wholly-owned Nigerian insurance firm. The mission of this firm is to create, package, and provide new insurance products that best meet the needs of customers, all while running a highly profitable, efficient, resourceful, and ethical organization that will last for a long time and be a significant asset to its owners.

They have the following plans available:

• Plus plan for investment
• Plan for auto insurance
• Plan for travel insurance
• Immediate annuity strategy
• Plan for Tuition Protection
• Capital budget

AXA MANSARD INSURANCE COMPANY

AXA Mansard Insurance provides life insurance as well as non-life insurance products and services. AXA Mansard Insurance is a subsidiary of the AXA Group, a global insurance and asset management company with operations in 64 countries across Central and South America, the Middle East, and Africa. They provide the following services:

• Services for asset/investment management
• Services for health management
• Administration of pension funds

INDUSTRIAL AND GENERAL INSURANCE PLC

On October 31, 1991, Industrial and General Insurance plc was formed as a private limited liability business. In 2007, it was re-registered as a public limited liability corporation. They address clients’ insurance needs through precise processes and rapid reaction times in a variety of industries, including banking, oil and energy, manufacturing, engineering, marine and aviation, and government institutions.

Mfonobong Daniel

Daniel is an Editor on Nigerian Infopedia who craves for writing, researching and also watching soccer.

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Pula, a startup providing nigerian farmers insurance against banditry raises $20m series b.

Pula, an agric insurance technology company based in Kenya has raised $20 million in a Series B funding round. The company, which is currently running a pilot program that provides rural farmers in Nigeria comprehensive insurance against banditry, disease and death of animals, said the new funding will be used to establish new partnerships as it looks to expand its insurance policies to include livestock insurance. 

The latest funding round was led by BlueOrchard through its InsuResilience strategy which aims at providing access to climate insurance to vulnerable people in emerging markets. The round also saw participation from the IFC through its $225 million venture capital fund, the Bill and Melinda Gates Foundation and Hesabu Capital. Other existing investors also participated in the round.

Speaking about the funding round, Pula CEO Thomas Njeru said partnering with this group of like-minded investors to boost the growth of Pula globally is a very exciting milestone in driving the startup’s triple 100 vision, through which it intends to bring insurance to 100 million smallholder farmers. 

“ What started nine years ago as an unconventional idea that many deemed un-scalable is now a proven solution that has solved real needs for millions of smallholder farmers across 22 countries ,” Njeru said.

Pula is providing insurance through distribution partners

Founded in 2015 by CEO Thomas Njeru and Rose Goslinga, the Kenya-based insurance technology company is focused on providing access to agricultural insurance to small-holder farmers across emerging markets in Africa. This insurance would protect them against losses caused by pests, diseases and extreme natural events like floods and droughts.

Instead of selling insurance directly to farmers, Pula has built a distribution channel of over 100 partners. These partners include charitable organizations, banks, governments and agricultural input companies. The distribution channels guarantee that the startup is able to reach farmers even in the most remote areas and provide what it calls “embedded insurance,” for instance, in farm input costs or credit.

So far, the startup said it has helped 15.4 million farmers across Africa, Asia and Latin America to get insurance. 

The startup says its products have been customised to suit the demands of its clients as well as the needs of the benefiting farmers. The products are underwritten by insurance and reinsurance companies and are designed through Pula’s digital actuary platform based on historical data including weather patterns, and the frequency of events like floods or drought, harvests, losses and inputs used.

Pula says farmers using these products have witnessed increased investment, yields and savings. This, according to the startup, underscores the benefits that agricultural insurance could hold for emerging markets like Africa, where small-scale farmers contribute 70 per cent of the food supply yet only 1 per cent of them are covered.

“ Research carried out by Pula in some African countries where we have delivered insurance shows that agricultural insurance helps smallholder farmers to on average increase investment in their farms by 16 per cent, improve yields by 56 per cent, and increase household savings by up to 170 per cent. Also, an impact on farmers’ livelihoods can be seen through our partner insurer’s payouts – which have reached close to over US$40 million to 900,000 farmers since Pula’s inception to date ,” Thomas Njeru said.

The CEO also said his startup’s impact is reflected in renewal rates and growths, pointing out that 80 per cent of the farmer groups and aggregators that buy Pula-developed insurance products from their partner insurers renew the following year. He said this rate is above the industry average and reflects customers’ satisfaction with their comprehensive products.

Pula introducing livestock covers with new funding

Therefore, building on the success of its crop insurance products, Pula says it is looking to introduce livestock covers in countries like Kenya. This will kickstart upon the completion of a pilot program that kicked off in Nigeria last year. Through insurance partners, the startup says it has been offering rural families in Nigeria comprehensive coverage against banditry, disease and death of animals. It would also be doubling down on Asia and Latin America, markets it entered in 2021.

Among its collaborations is a long-term partnership with the government of Zambia, where the insurtech embeds insurance premiums with fertilizer and seed packages, reaching farmers across the country. 

In Ethiopia, it partnered with the World Food Programme and German Development Bank KfW and a local insurer, where it embedded insurance in the input voucher scheme that reached 122,000 farmers. The startup says its impact is about to be felt in the Amhara region where it is set to make its largest insurance payout to date, estimated at $800,000, following an outbreak of wheat rust disease.

See also: “We can laugh about it now” ThriveAgric’s Uka Eje on how the company survived the COVID-19 troubles

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Insurers Reap Hidden Fees by Slashing Payments. You May Get the Bill.

A little-known data firm helps health insurers make more when less of an out-of-network claim gets paid. Patients can be on the hook for the difference.

By Chris Hamby

Chris Hamby reviewed more than 50,000 pages of documents and interviewed more than 100 people for this article. The New York Times also petitioned two federal courts for materials under seal.

Weeks after undergoing heart surgery, Gail Lawson found herself back in an operating room. Her incision wasn’t healing, and an infection was spreading.

At a hospital in Ridgewood, N.J., Dr. Sidney Rabinowitz performed a complex, hourslong procedure to repair tissue and close the wound. While recuperating, Ms. Lawson phoned the doctor’s office in a panic. He returned the call himself and squeezed her in for an appointment the next day.

“He was just so good with me, so patient, so kind,” she said.

But the doctor was not in her insurance plan’s network of providers, leaving his bill open to negotiation by her insurer. Once back on her feet, Ms. Lawson received a letter from the insurer, UnitedHealthcare, advising that Dr. Rabinowitz would be paid $5,449.27 — a small fraction of what he had billed the insurance company. That left Ms. Lawson with a bill of more than $100,000.

“I’m thinking to myself, ‘But this is why I had insurance,’” said Ms. Lawson, who is fighting UnitedHealthcare over the balance. “They take out, what, $300 or $400 a month? Well, why aren’t you people paying these bills?”

The answer is a little-known data analytics firm called MultiPlan. It works with UnitedHealthcare, Cigna, Aetna and other big insurers to decide how much so-called out-of-network medical providers should be paid. It promises to help contain medical costs using fair and independent analysis.

But a New York Times investigation, based on interviews and confidential documents, shows that MultiPlan and the insurance companies have a large and mostly hidden financial incentive to cut those reimbursements as much as possible, even if it means saddling patients with large bills. The formula for MultiPlan and the insurance companies is simple: The smaller the reimbursement, the larger their fee.

Here’s how it works: The most common way Americans get health coverage is through employers that “self-fund,” meaning they pay for their workers’ medical care with their own money. The employers contract with insurance companies to administer the plans and process claims. Most medical visits are with providers in a plan’s network, with rates set in advance.

But when employees see a provider outside the network, as Ms. Lawson did, many insurance companies consult with MultiPlan, which typically recommends that the employer pay less than the provider billed. The difference between the bill and the sum actually paid amounts to a savings for the employer. But, The Times found, it means big money for MultiPlan and the insurer, since both companies often charge the employer a percentage of the savings as a processing fee.

How MultiPlan and Insurers Make Money on Fees

MultiPlan and health insurers typically receive a percentage of the “savings” on each claim, creating an incentive to recommend lower payments.

MULTIPLAN ADVISES A 20% PAYMENT

MULTIPLAN ADVISES A 50% PAYMENT

A lower payment

means bigger fees for

the insurer and MultiPlan, but also a bigger potential bill for the patient.

The patient is potentially on the hook for this amount.

To MultiPlan

share of the

(paid by insurer)

(paid by employer)

For a doctor’s bill of $1,000:

20% PAYMENT

50% PAYMENT

A lower payment means bigger fees for the insurer and MultiPlan, but also a bigger potential bill for the patient.

Based on a share of the difference

Fee percentages vary based on negotiated contracts.

By The New York Times

In recent years, the nation’s largest insurer by revenue, UnitedHealthcare, has reaped an annual windfall of about $1 billion in fees from out-of-network savings programs, including its work with MultiPlan, according to testimony by two of its executives. Last year alone, MultiPlan told investors, it identified nearly $23 billion in bills from various insurers that it recommended not be paid.

MultiPlan and the insurers say they are combating rampant overbilling by some doctors and hospitals, a chronic problem that research has linked to rising health care costs and regulators are examining . Yet the little-understood financial incentive for insurers and MultiPlan has left patients across the country with unexpectedly large bills, as they are sometimes asked to pick up what their plans didn’t pay, The Times found. In addition, providers have seen their pay slashed, and employers have been hit with high fees, records and interviews show.

In some instances, the fees paid to an insurance company and MultiPlan for processing a claim far exceeded the amount paid to providers who treated the patient. Court records show, for example, that Cigna took in nearly $4.47 million from employers for processing claims from eight addiction treatment centers in California, while the centers received $2.56 million. MultiPlan pocketed $1.22 million.

Confidential Pricing and Fee Data

Itemized payments and fees for thousands of claims were made public in a lawsuit against Cigna after The Times petitioned the court. The insurer and MultiPlan opposed the release, calling the data “highly confidential.”

Payment amount

For providing outpatient

substance abuse treatment,

the facility received $134.13 .

Fee for Cigna

For processing the claim,

Cigna received $658.75 ,

nearly five times as much

as the treatment center.

Fee for MultiPlan

For recommending a payment

amount, MultiPlan received

$167.48 , slightly more than

the treatment center.

For providing outpatient substance abuse

treatment, the facility received $134.13 .

For processing the claim, Cigna received

$658.75 , nearly five times as much as the

treatment center.

For recommending a payment amount,

MultiPlan received $167.48 , slightly more

than the treatment center.

View the PDF .

MultiPlan, which makes nearly all its revenue from such fees, markets its calculations as “defensible, repeatable and completely transparent” and independent of insurance company influence. The firm estimates that its reach extends to more than 100,000 health plans covering more than 60 million people. Patients have encountered its pricing recommendations after a variety of treatments, including spine surgeries, physical therapy appointments and ambulance rides.

The company did not respond to detailed questions from The Times. In a statement, it said it uses “well-recognized and widely accepted solutions” to promote “affordability, efficiency and fairness,” by recommending a “reimbursement that is fair and that providers are willing to accept in lieu of billing plan members for the balance.”

In examining MultiPlan’s dominant role in this secretive world, The Times reviewed more than 50,000 pages of confidential corporate records, legal filings, claims information and other documents. The Times also interviewed more than 100 patients, doctors, billing specialists, advisers to employer health plans and former MultiPlan employees.

The Times found:

Patients hit with unexpectedly large bills sometimes forgo care or cease long-term treatment, and complain that appeals are fruitless. “They basically took away the mental health care I was getting,” said Olivia Henderson, who stopped her therapy sessions in New York when the cost spiked.

MultiPlan’s recommended payments not only push back against known overbillers, but can also squeeze smaller practices. Kelsey Toney, who provides behavioral therapy for children with autism from a clinic in rural Virginia, saw her pay cut in half for two patients. “I don’t want to say, ‘I’m sorry I can no longer accept you,’ especially when I’m the only provider within an hour,” she said.

Insurers pitch MultiPlan to employers as a way to control costs, but the fees can be onerous and unpredictable. New England Motor Freight, a New Jersey trucking company, was charged $50,650 by UnitedHealthcare for processing a single hospital bill.

Insurers can influence MultiPlan’s purportedly independent payment recommendations, according to MultiPlan documents made public by a federal judge after a petition from The Times. That generally means paying even less to doctors and making more in fees.

Former employees at MultiPlan, which has annual revenues of about a billion dollars, described a numbers-driven culture that encouraged locking in unreasonably low payments and tied their bonuses to the reductions. “I knew they were not fair,” said one former MultiPlan negotiator, Kajuana Young.

Regulators rarely intervene. The administration of employer-funded health plans is mostly exempt from state regulations. Enforcement primarily falls to an agency within the federal Department of Labor, which says it has one investigator for every 8,800 health plans.

In separate statements, UnitedHealthcare, Cigna and Aetna said MultiPlan helps them control costs for employers. A UnitedHealthcare spokesman said employers negotiate and accept contract terms, including the fee, and described the arrangement as “an industry-standard approach.” A Cigna spokeswoman also said the fee “aligns with industry standards,” adding that “it is fully transparent to our client” and has no influence on payouts to medical providers.

As to the issue of patients being billed for unpaid balances, Aetna said it offered employers “various options and strategies” to minimize the risk of unexpected charges. Cigna said that payment decisions could be appealed, and that it collected no fee if the patient was ultimately billed the balance. UnitedHealthcare blamed “egregious” charges by out-of-network providers and suggested that criticism of its work with MultiPlan had been stoked by a private-equity-backed medical staffing firm that is suing the insurer.

Determining what to pay when a patient goes out of network has long been a contentious issue. While such claims represent a small portion of all medical visits, they can be expensive, little understood by patients and difficult to avoid. Legislation that took effect in 2022 now protects patients from certain kinds of surprise bills but does not cover a vast majority of the claims directed to MultiPlan.

Insurers say that the traditional approach — paying a portion of what providers typically charge — no longer works because of dramatic price hikes. Cigna, in its statement, said some out-of-network providers last year tried to charge “up to 1,904 percent of what they charge Medicare.” Providers, meanwhile, argue that insurers and MultiPlan can’t be trusted to set fair rates.

The situation echoes a past scandal. Fifteen years ago, the New York attorney general broke up a pricing system that his office’s investigation concluded was “rigged.” The central player, UnitedHealth, agreed to pay $350 million to patients and medical professionals who said they had been shortchanged, and along with other major insurers, it agreed to reforms meant to ensure this wouldn’t happen again.

But the settlement left an opening.

An Industrywide Investigation

In 2009, a woman from Yonkers, N.Y., became a symbol of patients’ outrage and the promise of change.

Mary Reinbold Jerome had been diagnosed with ovarian cancer at age 62 and received treatment at Memorial Sloan Kettering. Because the hospital was outside her plan’s network, she was billed tens of thousands of dollars.

A tenacious woman who taught English to nonnative speakers at Columbia University, Dr. Jerome lodged a complaint with the state attorney general’s office, helping to prompt an industrywide investigation .

She stood beside Andrew M. Cuomo, then the attorney general, as he announced his office’s blistering conclusions : A payment system riddled with conflicts of interest had been shortchanging patients, and at its core was a data company called Ingenix. Insurers used the company, a UnitedHealth subsidiary, to unfairly lower their payments and shift costs to patients, the probe found.

UnitedHealthcare, Cigna, Aetna and other major insurers agreed to replace Ingenix with a nonprofit that would provide independent pricing data. Dr. Jerome was featured on news programs and hailed as an agent of change, while senators held hearings and blasted insurers for cheating patients.

In 2010, Dr. Jerome died.

“She was thinking beyond her own situation,” her daughter, Eva Jerome, said in an interview. “She was hoping it would have a broader impact.”

But amid the triumph, a key detail in the attorney general’s agreements with insurers largely escaped notice: The companies were required to use the nonprofit database for only five years.

When that term expired in 2014, MultiPlan was well positioned to capitalize.

‘All for Naught’

For decades, the company, founded in 1980, offered a traditional approach to managing out-of-network claims by negotiating rates with doctors. Insurers got discounts and assurances that patients would not have to make up the difference.

But after MultiPlan’s founder sold it to private equity investors in 2006, the company pursued a more aggressive approach. It embraced pricing tools that used algorithms to recommend lower payments, and no longer protected patients from having to pay the difference, documents show.

Meanwhile, private equity ramped up investments in physician groups and hospitals and, in some instances, began billing for extraordinary sums. Once insurers were no longer obligated to use the nonprofit database, FAIR Health, they began looking for ways to combat that billing and other charges they considered egregious. Because FAIR Health’s data was based on what doctors typically charged, insurers contended that overbilling would skew payments too high.

Cigna was particularly concerned with what it considered overbilling and fraud by substance abuse treatment centers. It halted some payments, opened investigations and met with a public relations firm “to precondition public support for any next steps we may need to take,” internal documents show.

In a 2015 email, unsealed after The Times’s request and over Cigna’s objection, a Cigna executive reminded colleagues of a key consideration.

“We cannot develop these charges internally (think of when Ingenix was sued for creating out-of-network reimbursements),” wrote Eva Borden, a chief risk officer at Cigna. “We need someone (external to Cigna) to develop acceptable” rates, she wrote.

UnitedHealthcare developed talking points to “position UnitedHealthcare as an advocate that is helping consumers push back on excessively high physician and facility bills,” a 2016 internal memo said.

Both insurers increasingly turned to MultiPlan. Internal documents show that UnitedHealthcare began a campaign to persuade employers to switch from FAIR Health. In a 2019 email, a UnitedHealthcare senior vice president emphasized creating a “sense of urgency” and helping companies still using FAIR Health “understand they don’t want to be on that program anymore.”

UnitedHealthcare had a big incentive to encourage this change. When it processed claims from employer plans using FAIR Health, the insurer collected no additional fee, according to legal testimony. But when it used MultiPlan, documents show, it typically charged employers 30 to 35 percent of the difference between the billed amount and the portion paid.

MultiPlan, too, charged a percentage of the savings, meaning it could make more by recommending lower payments. (FAIR Health charged a flat fee.)

While UnitedHealthcare was MultiPlan’s largest customer, Cigna and Aetna also embraced its tools and fee model, records show. Other insurers that work with MultiPlan include Kaiser Permanente, Humana and some Blue Cross Blue Shield plans.

Employers with self-funded plans administered by insurers include large companies like Coca-Cola and AstraZeneca and smaller organizations like school districts and union locals. (New York Times Company plans also operate this way.)

FAIR Health has expanded the types of data it offers and made it available online . Numerous states use the nonprofit when setting payments for government programs. Big commercial insurers still license its data, but they have largely shifted to other approaches, according to interviews, documents and statements from UnitedHealthcare and Cigna.

“If they’re able to go back to their old ways,” Eva Jerome said, “then it was all for naught.”

‘I’m Being Ripped Off’

When claims go through MultiPlan, some patients receive statements highlighting what their insurer calls discounts or savings — even as doctors or hospitals bill them for those amounts.

Cari Campbell, who received fertility treatment in Minnesota, was charged thousands of dollars that her insurer had labeled “you saved.” In Kansas City, Kan., Paul Haddix paid the amounts labeled “your discount” for his daughter’s occupational and speech therapy. In New Jersey, Jonathan Menjivar paid upfront for therapy appointments and saw his reimbursements plunge.

“I took a closer look at the explanation of benefits,” Mr. Menjivar said, “and noticed for the first time this column labeled ‘your discount,’ which is an interesting way of putting it.”

The supposed savings and discounts were the portions MultiPlan had recommended the employers not pay. Patients could still be on the hook.

Fact Check: An Explanation of Benefits

Insurance statements often identify savings or discounts. But sometimes patients can still be billed for that amount, as in this case involving the UnitedHealth subsidiary UMR.

Your discount: $871.78

Your plan negotiates discounts with providers and facilities to help save you money.

You saved: $1,293.74

82% of your service was covered by your

plan discounts, your employer-sponsored benefits plan, or other amounts for which you are not responsible.

82% of your service was

covered by your plan discounts, your employer-sponsored

benefits plan, or other amounts for which you are not responsible.

The burden can fall hardest on people with chronic or complex conditions who see out-of-network specialists. Justin Dynlacht, who has Crohn’s disease, paid extra for a plan that covered such visits. After seeing two in-network doctors about persistent abdominal pain, he went to an outside specialist who discovered a hernia containing abdominal tissue.

Aetna sent the specialist’s claims to MultiPlan, and Mr. Dynlacht was left with thousands of dollars in bills.

“I’m being ripped off,” he said. “It’s not right.”

Staying in-network can be especially difficult for mental health or substance abuse treatment.

A California woman whose teenage son was battling opioid addiction found only one treatment center that would accept him, and it was out of network. “When your kid has hit rock bottom, they’re dying, you get them in wherever you can,” she said, speaking on the condition that she not be named to protect her son’s privacy.

They had the most expensive health plan her employer offered, but her insurer, citing MultiPlan, left the family with tens of thousands of dollars in bills.

“I expected there would be some payment that wasn’t covered,” she said. “What I didn’t expect was the deceit that caused an even higher payment, an amount I never dreamed.”

Insurers sometimes suggest that a medical provider agreed to a lower payment, even when it’s not so. This patient was billed the amount that Cigna identified as savings.

You saved $370.62 . CIGNA negotiates discounts with health care professionals and facilities to help save you money.

Source: Read the PDF.

Some providers said they had begun requiring payment upfront or stopped accepting patients with certain insurance plans because appealing for higher payments can be time-consuming, infuriating and futile. Others have tried to sue insurers or MultiPlan. Dr. Rabinowitz, who repaired Ms. Lawson’s incision, hopes to collect the remaining balance from UnitedHealthcare in an ongoing case.

Surprise bills for some types of care are no longer an issue, insurers said, thanks to the law that went into effect in 2022 . Brittany Perritt didn’t realize the anesthesiologists at her 3-year-old’s brain tumor treatments in 2020 were out-of-network until the claims went to MultiPlan. If that care occurred today, she likely would be spared the calls from debt collectors, because she didn’t go out of network by choice.

But MultiPlan assured investors shortly before the law’s passage that it was likely to have “limited impact” on the company. In fact, MultiPlan said, 90 percent of its revenue involved out-of-network claims that wouldn’t be affected.

‘Lining Their Pockets’

Debra Margraf, a trustee for a union health plan covering about 1,500 Phoenix-area electricians, was stunned when she and her colleagues asked Cigna what they had paid for “cost-containment” services.

The answer: The fees had risen from just over $550,000 in 2016 to $2.6 million in 2019, according to a lawsuit the trustees filed.

“It’s very frustrating to go out and have someone pitch us that they’re going to save us money and then end up lining their pockets,” Ms. Margraf said.

Cigna did not respond to questions from The Times about specific employer plans.

Other employers have also questioned increased fees and complained about being kept in the dark. A UnitedHealthcare account executive emailed colleagues for help explaining the $50,650 fee charged to New England Motor Freight. The fee grew out of a $152,594 bill, of which just $7,879 was covered.

The trucking company “thinks these are a money tree for us in fees and we are milking them,” the account executive wrote.

One UnitedHealthcare executive suggested a partial refund and an annual cap on fees, but a colleague countered, “We have to be concerned about setting precedent.”

Inside an Insurer’s Debate About Fees

Internal emails show UnitedHealthcare employees grappling with complaints about high fees. When one executive suggested limiting the amount charged New England Motor Freight, a colleague resisted.

As a company we have been unwilling to enter into one-off agreements that cap our revenue, so we have to be very careful.

The way the fees were calculated was particularly galling: How could MultiPlan and insurers tie their own fees to bills they deemed unreasonable? It made no sense, one consultant for the trucking company wrote, to charge a 35 percent fee “if a hospital were to bill $20,000 for a flu shot.”

UnitedHealthcare did not respond to questions from The Times about the trucking company. In a statement, the insurer said it also offers fee arrangements not tied to billed amounts.

Cigna’s statement defended its fee, saying that “it enables us to administer the program, negotiate with providers and absorb the long-term risk associated with any challenging negotiation.”

Even verifying the accuracy of fees was difficult when UnitedHealthcare initially refused to provide the trucking company with the full underlying data. Cigna refused a similar request from auditors for Arlington County, Va., which it had charged $261,000 in one year. “There is no process for verifying the accuracy of any of these amounts,” the auditors wrote.

Large employers also have trouble getting data from insurers, said James Gelfand, head of the ERISA Industry Committee, which represents big companies with employee benefit plans.

Cost-containment programs can be a “revenue center” for insurers, Mr. Gelfand said, but are “extremely difficult for employers to police.”

‘In a Lot of Pain’

Patients have limited recourse. If they want to sue, they usually must first complete an administrative appeals process; even then, they stand to collect relatively modest amounts.

Regulators are unlikely to step in. Self-funded employer plans are largely exempt from state oversight. And federal regulators have limited resources and legal authority to police them.

Even when patients figured out where to direct complaints — the Employee Benefits Security Administration — they described the process as draining and mostly fruitless.

Patti Sietz-Honig, a video editor at Fox 5 in New York, filed a complaint in 2022. The cost of seeing a specialist for chronic back pain had spiked, and she faced roughly $60,000 in bills.

Ms. Sietz-Honig pressed for updates about her complaint and sent articles critical of MultiPlan from Capitol Forum, a site focused on antitrust and regulatory news. Last March, the agency emailed her that her employer and her insurer, Aetna, had agreed to a “temporary exception” and made additional payments.

“Unfortunately,” the agency wrote, the law “does not prohibit the use of third-party vendors” to calculate payments.

Meanwhile, her longtime pain specialist started requiring payment upfront. To save money, Ms. Sietz-Honig spaced out her appointments.

“I’ve been in a lot of pain lately,” she said, “so I’ve been going — and paying.”

‘Not a Real Negotiation’

As MultiPlan became deeply embedded with major insurers, it pitched new tools and techniques that yielded even higher fees, and in some instances told insurers what unnamed competitors were doing, documents and interviews show.

After meeting in 2019 with a MultiPlan executive, a UnitedHealthcare senior vice president wrote in an internal email that other insurers were using MultiPlan’s aggressive pricing options more broadly, and that UnitedHealthcare could catch up.

“Dale did not specifically name competitors but from what he did say we were able to glean who was who,” the executive, Lisa McDonnel, wrote, referring to Dale White, then an executive vice president at MultiPlan. She described how Cigna, Aetna and some Blue Cross Blue Shield plans were apparently using MultiPlan.

In recent years, MultiPlan’s top revenue generator has been an algorithm-based tool called Data iSight that consistently produces the lowest payment recommendations. Some insurers have used it as part of a strategy MultiPlan calls “target pricing” or “meet-or-beat”: Insurers set a maximum price they will pay, and MultiPlan collects a fee only if its recommendation is lower.

In theory, many of MultiPlan’s recommendations are negotiable. But documents and interviews revealed tactics meant to pressure medical practices to accept low payments. Some offers came with all-caps admonitions and deadlines just hours away. Accept and receive prompt payment; refuse and risk an even lower payout. Practices and billing specialists said this often wasn’t an empty threat.

“It’s not a real negotiation,” said Tammie Farkas, who handles billing for her husband’s small New York-area practice focused on repairing blood vessels in the brain.

Insurers can set negotiation parameters for MultiPlan, including not negotiating at all, records and interviews show. Multiple providers and billing specialists said that in recent years they had increasingly been told their claims weren’t eligible for negotiation.

“It wasn’t this bad before,” said Tiffany Letosky, who oversees a small practice specializing in surgeries for endometriosis and gynecologic cancers.

Former MultiPlan negotiators said their bonuses had been linked to their success at reducing payments, incentivizing a hard-line approach.

Ms. Young, the former negotiator critical of the process, said she had occasionally called a provider from a cellphone — knowing that her work line was recorded — and advised against accepting her own offer.

Another former negotiator said the pressure to get bigger discounts had made her physically ill. “It was just a game,” she said. “It’s sad.”

Jennifer Pittinger, also a former negotiator, said she saw nothing wrong with the hard-driving approach because she believed she was combating overbilling.

“I was a bit of a viper,” she said. “Sometimes I just wanted to go in as hard as I could because my bonus is affected. If I can get a provider to accept 50 percent off, that’s great for me.”

But tools rolled out to combat price-gouging hospitals and private-equity profiteers, The Times found, have also been directed at people like Ms. Toney, the therapist in rural Virginia who treats children with autism.

She charges the rates that Virginia pays for people on Medicaid. But last year, she said, Meritain Health, an Aetna subsidiary, informed her that fair payment for her services was less than half what Medicaid paid, based on calculations by MultiPlan.

Ms. Toney has not billed the parents of her two patients covered by Meritain, but going forward she will not accept patients with similar insurance.

“It puts me in a tough position,” she said. “Do I want to pay myself a salary or be able to help people?”

Julie Tate contributed research. Produced by Guilbert Gates and Rumsey Taylor .

Chris Hamby is an investigative reporter for The Times, based in Washington. More about Chris Hamby

• Tuesday, April 16, 2024

© 2023 - Businessday NG. All Rights Reserved.

Accounting Measurement Plan Draws Blunt Feedback for US Board

By Nicola M. White

How businesses should measure assets and liabilities is one of the trickiest issues in accounting. Feedback on a plan to streamline US rulemakers’ approach to setting measurement requirements reflects just how thorny that debate can get.

Academics, audit firms, and professional groups gave blunt feedback on a Financial Accounting Standards Board proposal laying out high-level concepts for how assets and liabilities should be measured, comment letters show. The proposal is confusing, some responses said, and others said it didn’t go far enough to help the board craft consistent accounting rules.

The proposal , issued in December as a draft chapter in FASB’s Conceptual Framework , calls for updating an internal guide the board uses when making tough decisions about writing accounting rules for US companies and not-for-profit organizations. FASB has been working on and off on its Conceptual Framework since the board was founded in 1973 but has never developed robust concepts on measurement.

Measurement has always been a tough theoretical debate for the board, with techniques largely divided into two camps. Some assets and liabilities get measured at fair value, a method that captures the most-up-to-date value of assets but also injects volatility into earnings. Others get measured at cost, the price paid plus some adjustments. How an item is measured affects the numbers businesses report, which ultimately impacts earnings.

The current proposal doesn’t offer ground-breaking guidance and maintains the status quo, wrote Paul Miller , emeritus accounting professor at the University of Colorado at Colorado Springs and author of a book about FASB’s history.

“Beyond any doubt, I believe the board could have done better,” Miller wrote. “If this draft represents the best it can do, I’m full of doubts about its present credibility and its future existence.”

The CFA Institute, an investor advocacy group, also criticizedthe plan, saying it won’t help FASB figure out which measurement system should be used for any particular asset or liability.

“By leaving most of the work of choosing a measurement system to the standards level, we don’t see how the Exposure Draft will help the Board drive improvements in financial reporting,” the group wrote .

Tough Decisions

The draft framework does not directly affect accounting practices for US companies and not-for-profit organizations that follow FASB’s rules. It does, however, influence how the board tackles measurement when setting accounting rules, which would impact financial reporting.

Under the proposal, measurement must be anchored in prices—both entry prices and exit prices. Prices objectively measure the financial effects of transactions and other events and circumstances. Prices are fundamental in depicting recognized items like assets or liabilities in general purpose financial reporting, the proposal states.

Reported amounts of assets should not be more than what is recoverable and the reported amount of liabilities should not be less than what can be settled, according to the proposal. Essentially, assets shouldn’t be overstated and liabilities shouldn’t be understated.

Some responses to the FASB proposal questioned whether only two types of measurement systems work for all assets and liabilities.

Deloitte & Touche LLP said entry and exit price systems are two relevant measurement systems, but they shoudln’t be the only ones. Sometimes items need to be subsequently measured based on the recovery of costs, Deloitte cited as an example. The accounting firm recommended FASB clarify its description of measurement systems by separating initial measurement from subsequent measurement.

Fair Value Terms

Several organizations said they were concerned about using the terms “entry price” and “exit price” in the proposal. The terms are currently used in FASB’s fair value measurement accounting guidance, outlined in ASC 820 , to refer to different fair value approaches.

The terms have different meanings in that context, however, compared to their meanings in the proposal, accounting firm BDO USA said . It recommended FASB use different terms in the framework to avoid confusion.

Grant Thornton LLP made a similar point, noting that “fair value” is used in several places in the proposal, with potentially different meanings and implications. In some places, it seems to be used interchangeably with an exit price, the accounting firm said. In other places, the proposal discusses exchanges at fair value that do not appear to refer solely to market participant exit prices, according to Grant Thornton.

Advisory and valuation firm Kroll warned about the framework potentially conflicting with accounting rules on fair value itself. It called the proposal “incongruent with the nature, breadth, and frequency of the application of fair value,” which could impact future standard-setting.

FASB’s Conceptual Framework sets definitions of bedrock financial reporting concepts, such as assets and liabilities, and the definition of a “reporting entity.” The measurement chapter is the final piece FASB needs to finalize. The board wants to finish its work by midyear, according to an agenda.

The document, a constitution of sorts for the board, is supposed to help FASB frame, discuss, and resolve issues.

“Without exaggeration, the board’s future existence depends on finishing the framework with the best answers and is at risk if it avoids hard questions and decisions,” the University of Colorado’s Miller wrote .

To contact the reporter on this story: Nicola M. White in Washington at [email protected]

To contact the editors responsible for this story: Andrea Vittorio at [email protected] ; Jeff Harrington at [email protected]

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