Insurance Firms Double Tax Payments to N15.2bn Despite 15% Drop in Profit Before Tax
Nigeria’s insurance sector recorded a significant rise in tax contributions in 2025, with 11 major insurance companies paying a combined N15.2 billion in income taxes, more than double the N6.6 billion remitted in 2024. The sharp increase came on the back of stronger insurance revenues and improved earnings across much of the industry, highlighting the sector’s growing role in the nation’s economic landscape despite mounting profitability challenges.
An analysis of the audited financial statements of the 11 insurers showed that total insurance revenue rose by 34 percent, reaching N827.49 billion in 2025 from N617.41 billion recorded a year earlier. However, the impressive revenue growth did not fully translate into stronger bottom-line performance. Combined profit before tax (PBT) fell by nearly 15 percent, dropping to N162.18 billion from N190.51 billion in 2024, reflecting rising operating costs, claims expenses, and other industry pressures.
Among the companies reviewed, Custodian Investment Plc emerged as the highest taxpayer, remitting N3.76 billion in income taxes compared to N1.48 billion in the previous year. The company also posted one of the strongest financial performances in the sector, with insurance service revenue climbing to N141.4 billion and profit before tax increasing to N77.35 billion. AXA Mansard Insurance Plc followed closely with N3.34 billion in tax payments, although its profitability weakened considerably. Despite generating N160.6 billion in insurance revenue, the insurer’s profit before tax plunged to N6.12 billion from N31.69 billion, while net profit dropped sharply to N619.8 million.
Mid-tier insurers also recorded notable increases in tax contributions. NEM Insurance and Sovereign Trust Insurance each paid N1.88 billion in taxes during the year, while Coronation Insurance Plc contributed N1.08 billion. Although these firms reported higher insurance revenues, several experienced declining profits, underlining the widening gap between revenue growth and actual profitability. Meanwhile, Mutual Benefits Assurance and Cornerstone Insurance also increased tax remittances, reflecting improved business volumes and expanding market activity.
On the lower end of the tax spectrum, AIICO Insurance, SUNU Assurances Nigeria, Lasaco Assurance, and Universal Insurance posted smaller tax payments but delivered mixed financial performances. AIICO recorded stronger profits and revenue growth, while Lasaco slipped into a pre-tax loss despite higher revenue. Universal Insurance, which paid the least tax among the firms reviewed at N43.1 million, nonetheless reported a remarkable improvement in profitability. Overall, the 2025 results paint a picture of an insurance industry experiencing robust revenue expansion and increased tax obligations, even as profitability remains under pressure across several operators.
source: The cable