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Foreign insurers are invading Nigerian market, as UK’s Prudential acquires Zenith Life

The business opportunities provided by Nigerian market is huge, as almost human activities now require one form of insurance policy.

Zenith-Prudential partnership seeks to revolutionise insurance market in Nigeria.

Owing to this, some government agencies have made one form of insurance policy or the other a criterion for issuance of needed government documents.

For example, getting a car insurance is a compulsory requirement for issuance of drivers' license and number plate.

This, coupled with rising household incomes, has positioned Nigerian insurance industry as a market with great potentials. Hence, the entrance of foreign insurance companies into the country.

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The first sign was the collaboration between Sanlam Insurance of South Africa and First Bank Nigeria Plc in 2010. This era saw a lot of such collaboration between Nigerian banks and other foreign based insurance companies.

In 2014, the French insurance giant, AXA announced 77% equity stake acquisition in Mansard Insurance. This signifies a beginning of foreign companies’ inroads into the Nigerian nascent insurance market.

With a good rating by Fitch Ratings as a market “ripe for consolidation”, the UK insurer, the Prudential has acquired a majority stake in Zenith Life with an exclusive bancassurance partnerships with Zenith Bank in Nigeria and Ghana.

Though, the company is new to the Nigerian bank, it seeks to leverage Zenith Banks’ presence in Nigeria and Ghana Insurance market to establish a foothold.

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With this deal, this is the second firm owned by Mr Jim Ovia that would be acquired by a foreign company. The first being Visafone Telecommunication Limited by MTN Group in 2015.

Speaking on the development, Mr Jim Ovia described the acquisition as a landmark, which would redefine life insurance industry in Nigeria.

“Given the combination of Zenith Life’s local presence with one of the world’s oldest and most successful life insurers, we expect Zenith-Prudential Life to act as a significant catalyst within the sector.

“We anticipate creating thousands of employment opportunities in Nigeria by embarking on this transformational deal,” Jim said.

The company, which would now be known as Zenith-Prudential Life Insurance, is noted as part Prudential’s plan to expand operations in Africa.

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Before this acquisition, the Prudential has launched business operations in Ghana, Kenya, Uganda and Zambia.

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