Namibia recorded a 22.6% increase in new insurance policies during the first quarter of 2024, according to a new report from the Namibia Financial Institutions Supervisory Authority (NAMFISA).
Despite the surge, the NAMFISA quarterly statistical report shows that the year-on-year figure reflects a notable decline of 45.3%, with a total of 102,597 new policies underwritten as of March 31, 2024.
NAMFISA reports that the overall number of active policies rose by 3.2% quarter-on-quarter, reaching nearly 1.94 million, driven by a decrease in terminations and lapses.
“The quarterly growth in the demand for credit risk policies drove the rise in new policies underwritten during the quarter. Conversely, the annual decline in new policies stemmed from a reduced demand and appetite for individual investments and fund-risk class policies during the review period,” said NAMFISA.
Meanwhile, policy lapses decreased by 6.8% quarter-on-quarter and by 62.1% year-on-year, totalling 23,734 policies during the review period.
“The decline in policy lapses can be attributed to seasonality, where individuals promptly serviced their policies in the year’s first quarter. Additionally, a notable reduction in funeral policies contributed to the decrease in policy lapses during the review period,” said NAMFISA.
The report noted that terminated policies decreased by 18.4% quarter-on-quarter and by 37.1% year-on-year, amounting to 15,662 policies during the review period.
“The quarterly and yearly reduction in terminated policies can be attributed to seasonality, where policyholders opted to retain their existing policies during the period under review,” the report stated.
During the first quarter of 2024, the funeral and risk classes of the insurance business were the primary contributors to the number of policy lapses, accounting for 54.5% and 44.0%, respectively.
“Regarding policy termination, the credit life and funeral risk classes of insurance were the primary contributors to terminated policies during the first quarter, accounting for 33.7% and 27.5%, respectively,” said the report.
This comes as gross written premiums (GWPs) showed a marginal increase of 0.6% quarter-on-quarter and 4.8% year-on-year, reaching N$2.9 billion by the end of the first quarter of 2024.
“The growth in GWPs for both periods is predominantly due to the rise in new policies underwritten throughout the quarter, particularly in the credit life, fund life, and individual investment business categories,” the report noted.
