GCR Upgrades Tangerine Life Insurance Financial Strength Rating to A
GCR Ratings has upgraded Tangerine Life Insurance Limited’s national scale financial strength rating to A(NG) from A-(NG), with a stable outlook.
The rating upgrade reflects Tangerine Life’s strong financial profile, with liquidity and capitalisation consistently maintained at high levels, GCR said.
However, ratings analysts noted that these strengths are partly offset by the insurer’s modest competitive position.
“Tangerine Life is a mid-tier player within the Nigerian life insurance segment, with service offerings that span across individual assurance, group life assurance, investment-linked and endowment products, as well as other specialised life insurance products.
“The insurer’s market position is supported by its extensive track record, strong brand franchise, and relationships with sister companies such as Tangerine General and THT, which provide opportunities for cross-selling.
“In 2025, Tangerine Life’s insurance revenue increased by 29% to NGN10.4 billion (USD7.0 million), due to digital optimisation strategies that streamlined agent and customer onboarding.
“These initiatives also supported retail diversification, with the individual life segment accounting for 38% of gross written premiums as of 31 December 2025 from 34.0%”
GCR said the insurer’s competitive position remains constrained by its limited market share of c.1% of the industry premium. Looking ahead, the implementation of the insurer’s growth initiatives is expected to support business scale and competitive position over the outlook period.
Tangerine Life’s risk-adjusted capitalisation is a major ratings strength, reflecting the robust capital base relative to the aggregate risk exposures.
As of 31 December 2025, the insurer’s shareholders’ funds grew by 18.7% to NGN14.4 billion or USD9.7 million, underpinned by improved earnings generation and retention, thereby supporting compliance with the new capital requirements.
As a result, the insurer’s GCR capital adequacy ratio (CAR) remained strong at 3.2x, down from 3.3x in 2024, while the regulatory solvency ratio registered at 4.4x, above the regulatory minimum of 1.0x.
“We expect the GCR CAR to remain above 3.0x over the outlook period due to further earnings accretion, minimal dividend upstreaming, and the conservative investment strategy”.
Tangerine Life’s underwriting performance improved in 2025, with the insurance service result increasing by 169.0% to NGN1.6 billion (USD1.1 million), due to rapid growth in insurance revenue.
However, insurance finance expenses increased significantly following a one-off decline in the prior year, driven by the rapid rise in interest rates in 2024.
As such, the insurer’s profitability grew marginally, with profit before tax at NGN2.4 billion as of 31 December 2025, up from NGN2.3 billion in 2024.
Despite the resulting decline in return on revenue to 27.6% from 67.6% in 2024, the current level remains sound. Similarly, return on investment was strong, registering at 20.7% in 2025 from 17.3%.
“We expect the insurer’s good earnings profile to be sustained over the outlook period, supported by premium growth and profitable underwriting”.
Tangerine Life’s liquidity assessment remains sound, supported by its conservative investment strategy and adequate coverage of short-term obligations.
GCR said the insurer’s investment portfolio remains predominantly allocated to highly liquid assets, particularly government securities and short-term deposits, which accounted for 29.1% and 10.0% of total investments, respectively, as of 31 December 2025, compared with 29.0% and 10.1% in 2024.
Over the next 12-18 months, the GCR liquidity coverage ratio is projected to range from 1.6x to 1.8x, assuming the insurer maintains its current investment strategy.
GCR said the stable outlook reflects expectations that strong capitalisation and liquidity metrics will be sustained, underpinned by a conservative asset allocation strategy and earnings accretion.
