By Chiamaka Ajeamo, [email protected] 08060655687
Year 2020 was tough for insurance industry as operators witnessed many ups and downs occasioned by the COVID-19 pandemic, EndSARS riots while battling to meet up with the recapitalisation deadline.
Notwithstanding the challenges encountered by the industry last year, stakeholders are optimistic about the huge opportunities 2021 brings as they expressed their expectations for the industry while also beaming search lights on key issues that need to be addressed by both regulators and operators as business kicks off.
Though, according to some industry experts, looking at how the sector closed the previous year; without a definite conclusion of the issues at hand and some insurers owing huge unsettled claims to policyholders, it is expected that discussions of last year would continue this new year.
However, formulation and implementation of solid insurance policies, effective communications system, technology, innovative products and services; and strategic partnerships top the priorities of stakeholders for the industry in 2021.
Speaking to Daily Sun, Mr Boniface Okezie, the National Chairman, Progressive Shareholders Association of Nigeria, said there should be stronger regulatory policies and enforcement by the government and regulators for the sector to flourish.
According to Okezie, one of the major problems of the industry is policy formulation and execution and not necessarily the recapitalisation exercise which the industry is embarking on.
He said: “Recapitalisation is not the main problem of the insurance industry, [in] the previous recapitalisation exercises, how was the money utilised? So, money is not the key problem confronting the sector but policies needed to grow the industry.
“For instance, for compulsory insurance to work in the country, the government has to be stringent in enforcing them through the various enforcement agencies and do away with unpopular policies that tend to drag operators down. Operators do not have the power to enforce policies, they can only assist.
“In advanced countries, insurance is at the top and they own banks, but the case is different here. It is high time the insurance sector in Nigeria began to acquire banks just as it is obtainable in the West. Policies and programmes needed for the sector to be at the top should be articulated and implemented.
“If the government want the insurance industry to play its role and contribute to the Gross Domestic Product (GDP) growth, they must assist them in whatever capacity they need for them to function effectively.
“For operators, the challenges which the sector faced last year have not been eradicated, it’s still staring them in the face. What they should do now is to double their efforts, they should take advantage of the extension of the recapitalisation to ensure they come out stronger. They must exploit this extension judiciously to reposition themselves to begin to compete with banks. If they do this, they will perform very well because huge opportunities abound in the industry but largely untapped,” he expressed.
As for Mr Fatai Adegbenro, the Executive Secretary, Nigerian Council of Registered Insurance Brokers (NCRIB), more businesses and contracts are expected for the industry because of capital projects in the budget which will require insurance policies.
“We are optimistic about a better business year. If things work as planned and the new insurance Act is implemented, it will be a better year for the industry. The National Insurance Commission (NAICOM) is committed to growing the industry and the EndSARS protests was a blessing in disguise for the industry because it revealed the relevance of insurance to the government and Nigerians at large.”
On his part, Ekerete Ola Gam-Ikon, an insurance Expert and Consultant, said effective communications between operators and the public tops the list of his expectations for the year.
According to Gam-Ikon, the industry is doing a lot to sustain the national economic development but very little is shared among the public, especially given the prevalent trust deficit in the relationship between the industry and Nigerians. He further added that, in dealing with trust issues, communication is a key ingredient for success, so the industry needs to communicate effectively with the public made up of existing and potential policyholders.
He said: “It is most surprising that the industry has continued to seemingly take communication for granted as compared to other financial services providers in this digital age. Effective communication entails exchange of information and data between parties. Incidentally, policyholders have increased their correspondences to the industry regulator and operators but have not received as many responses thus, the low insurance penetration we have in Nigeria. Do you know that Nigeria sits 8th position from the bottom among African countries in terms of insurance penetration? This is unacceptable and a critical reason to emphasize communication as a strategic step to see the adoption of insurance go up.
“There are many wonderful things Nigerians need to know about the value and benefits of insurance and the insurance industry led by NIA, NCRIB, ILAN and supported by NAICOM and CIIN should deliberately develop a well-articulated communication plan. We expect to see more of the faces that are Heads of Corporate Communications in these insurance institutions actively engaging the public, informing them and answering their questions. Remember, there is nothing more annoying than talking to someone and be ignored.
“Besides, the cost of communication has become much cheaper by using online and mobile solutions. So all we need are people that will give time to the calls, text messages, posts and emails that come in. It is shocking to hear policyholders and claimants complain in this age that they sent messages to phone numbers and email addresses provided by the regulator or some operators and their requests/issues remain unanswered and unresolved.
“We need to distinguish the insurance industry in Nigeria this year by seeking to win that award as the industry that communicates most, and we would not be doing anything new. For a business like insurance that had relied so much on face-to-face meetings, communication remains very important and can only be boosted during this #staysafe era.
“Also, there is space to take and expand when you communicate effectively in this digital age. If you do not have and hold your space, others will take it.
“Finally, new products, collaborations and partnerships necessary to enhance insurance awareness and deepen penetration could not be given due attention last year due to the many challenges faced by operators, are the areas we expect more positive actions from operators in 2021.
“Specifically, as insurers unfold their plans for the microinsurance window, we expect to see initiatives that will boost the relationship between aggregators and insurers”, Gam-Ikon stated.
For Dr Uzoma Ofurum, an Enterprise Risks Management Consultant and former Manager, Marketing, Anchor Insurance, operators and regulators this year need to be savvier, invest more in engaging the public on Insurance matters using various media platforms, show more concern for people who suffer losses and have come forward to make claims.
He noted that there is no excuse for not investing in appropriate technology to drive swifter customer experiences and no reason while claims should not be paid in 48 hours of notification.
Ofurum, urged operators to develop products suitable for 2021 risks, provide training to the staff and agents in appropriate areas and; on the issue of penetration, 2021 offers fresh opportunities to leap, raise champions and take territories. The market is waiting and it is up to the insurance Professionals to rise to the challenges.