Motor Vehicle Insurance - Nigeria

The Motor Vehicle Insurance market market in Nigeria is expected to witness significant growth in the coming years.
By 2024, the market size, measured by the gross written premium, is projected to reach a staggering US$1.61bn.
This indicates a promising outlook for the industry in the country.
In terms of individual spending, the average per capita expenditure on Motor Vehicle Insurance market is estimated to be US$7.03 in 2024.
This figure provides insight into the level of importance that Nigerians place on protecting their vehicles.
Furthermore, the gross written premium is anticipated to experience a steady annual growth rate of -3.23% from 2024 to 2029.
This growth trajectory is expected to result in a market volume of US$1.37bn by 2029.
It is worth noting that in a global context, the United States leads the pack in terms of gross written premium, with a projected value of US$341.6bn in 2024.
This highlights the dominance of the American market in the Motor Vehicle Insurance market sector.
Considering these numbers and projections, it is evident that the Motor Vehicle Insurance market market in Nigeria is poised for steady growth, positioning the country as a significant player in the global insurance industry.
Nigeria's motor vehicle insurance market is experiencing a surge in demand due to the increasing number of car ownership and the government's efforts to enforce mandatory insurance policies.

Definition:

Motor vehicle insurance, often referred to as auto insurance, is a type of coverage that offers financial protection to individuals who own or operate vehicles like cars, motorcycles, or trucks. When you have motor vehicle insurance, you pay regular premiums to an insurance company, and in return, the insurer helps cover the costs associated with accidents, damages, and injuries related to your vehicle. This insurance market is essential for providing security and financial assistance in case of accidents, ensuring that individuals can repair or replace their vehicles.

Additional information:

The market contains the following KPIs: gross written premium aggregated for all countries and regions, gross written premium per capita, and the share of insureds in the total population for over 50 countries.

Insurance of land motor vehicles

Accident insurance
Insurance for aerial vehicles
Insurance for watercraft
insurance for spacecraft
All other insurance types, such as life insurance and health insurance
Reinsurance

The Motor Vehicle Insurance market in Nigeria is experiencing significant growth and development recently.

Customer preferences: Customers in Nigeria are increasingly valuing comprehensive motor vehicle insurance coverage to protect their vehicles from various risks such as accidents, theft, and natural disasters. Additionally, there is a growing demand for convenient and efficient digital platforms for purchasing and managing insurance policies.

Trends in the market: One of the notable trends in the Motor Vehicle Insurance market in Nigeria is the rise of usage-based insurance, where premiums are calculated based on individual driving behavior. This trend is gaining traction as insurance companies leverage telematics technology to collect data on driving habits, allowing for more personalized pricing and coverage options. Moreover, there is a noticeable shift towards more affordable insurance products tailored to different income levels in the country.

Local special circumstances: In Nigeria, the Motor Vehicle Insurance market is influenced by factors such as the high rate of road accidents and vehicle theft, prompting individuals to prioritize insurance coverage for their vehicles. Additionally, the regulatory environment and enforcement of mandatory insurance requirements play a crucial role in shaping the market dynamics.

Underlying macroeconomic factors: The development of the Motor Vehicle Insurance market in Nigeria is also influenced by broader macroeconomic factors such as the country's GDP growth, disposable income levels, and the overall stability of the insurance sector. As the economy continues to grow and consumer purchasing power increases, more individuals are likely to invest in motor vehicle insurance to safeguard their valuable assets.

Data coverage:

Data encompasses B2B and B2C enterprises. Figures are based on gross written premium, gross written premium per capita, gross claim payments, loss ratio, and distribution channels.

Modeling approach / Market size:

Market sizes are determined by a Bottom-Up approach, based on a specific rationale for each market layer. As a basis for evaluating markets, we use industry associations, national statistic offices, and international organizations, such as OECD. Next we use relevant key market indicators and data from country-specific associations such as insurance consumer spending, gross domestic product, insurance - consumer price index (CPI), population growth. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. For example, exponential trend smoothing and HOLT-linear. The main drivers are insurance consumer spending and insurance - consumer price index (CPI).

Additional Notes:

The market is updated twice per year in case market dynamics change. The impact of the COVID-19 pandemic is considered at a country-specific level.

This report presents a comprehensive analysis and additional information on the Financial market, in a PDF format.

As the population of the United States grows, so too does the number of drivers on the road and thus the customer base for motor insurance. In 2022, there were over 280 million registered vehicles on the roads in the United States. Of those millions of registered vehicles, each year there are also millions of vehicle crashes. Road traffic fatalities in the U.S. peaked in 2021. So while many individuals feel secure in their vehicles, the statistics indicate the importance of automobile insurance and in most cases, auto insurance is required by law. Auto insurance is important because it not only covers any physical damage that may occur in an accident, but also any damage or injury that might be caused because of a vehicular accident or which may be done upon oneself or one’s vehicle by another vehicle or accident – a falling tree for example.