By Henry Uche mercy4henryuc@gmail.com
Stakeholders in the insurance sector has charged President Bola Tinubu and the state governors to incorporate insurance experts into their economic teams for greater professional fortification, especially in the face of persisting Volatile, Uncertain, Complex and Ambiguous (VUCA) operating environment.
Their position was amplified at the maiden edition of Insurance Summit organised by Independent Newspaper Limited in Lagos recently, with the theme, ‘Inclusive Insurance: Navigating The New Narratives for Sectorial Growth’.
Resource persons at the summit believe that with the turbulent global environment, particularly Nigeria’s anaemic economy, the need to carry insurance professionals along in every decision making process, policy design, project planning and implementation as well as other activities that affect the well-being of masses, has become inevitable.
To them, if the government at federal and state levels fails to deploy their hindsight and take proactive steps to seek the expertise of insurance and risk professionals in their work, the unimaginable consequences is better imagined than seen.
This, they made conspicuous as 31 states governors, their analysts and advisors scamper for escape routes following the warning issued by Nigerian Meteorological Agency (NiMet) on the impending doom to be brought about by heavy flood.
Moreover, they noted that the progress made so far in the industry does not align with the country’s population of over 200million people, with only 1.5per cent of all Nigerian adults covered by insurance while uninsured Nigerians have daily life and endeavour risks unattached to any insurance company. They admitted that inadequate manpower development, financial illiteracy and trust deficit are issues the sector must address decisively to be competitive.
Participants at the event which included students of insurance from Lagos State University (LASU), and University of Lagos, made case for themselves on the need to encourage potential and prospective insurance students achieve their goals as they toe the line of insurance.
For one of the students, the dearth of trust and confidence most Nigerians still conceive against the insurance industry still worries them, hence the urgent need for a lasting solution. In August 2022, Daily Sun gathered from students of insurance department of LASU that, over 40 percent of them studying insurance course never applied for the course.
Further interaction with them revealed that most of them opted for Accounting, Economics, Banking & Finance, Business Administration, Management and other business subject courses, but were transferred to study insurance due to their ineligibility to study their preferred course choices. This is the norm in many Institutions of higher learning.
“What we hear about insurance profession by some old practitioners is not encouraging. But we can see that many people are making it in the industry; and the way things are panning out in Nigeria and the world at large these days, the need for insurance and risks managers is becoming unavoidable and inevitable but we need to be encouraged” they implored.
Other participants as the forum sought to know if the properties of government across the three tiers of government in the Ministries, Departments and Agencies (MDAs), comply with the law and duly insured as required by ‘NAICOM Act on public buildings and buildings under construction’ across the country. According to them, making provisions for insurance (on critical projects) in both national and state budgets year on year is something the media, industry watchers and other interest groups should take up especially during implementation.
“Government must lead by example, by taking it as a top priority to underwrite every public property including foreign companies assets, we need to know if all these properties are well covered. If this be the case, NAICOM would in no distance time surpass its current N1 trillion Premium Written.
“The entertainment industry should not be left out as well as the agricultural sector, to mitigate the impact of attacks, mishaps and other unfortunate incident as we have witnessed recently. Government should know that insurance is an essential accelerator of economic growth and development, therefore should not be relegated.
Panelists which included the Director General of Nigeria Insurers Association (NIA) Mrs. Yetunde Ilori; Group Chief Executive Officer, Consolidated Hallmark Holdings Plc, Eddie Efekoha, who doubles as the president of West African Insurance Companies Association (WAICA); MD/CEO of Royal Exchange General Insurance, Mrs Ebelechukwu Nwachukwu, and others called for collaboration among insurance companies, banks and Federal Road Safety Corps, to sell insurance products and services at a fair and affordable price.
They urged players in the industry not to give up in the campaign on customers education and awareness, as well as strive not to fall short of thinking creatively and innovatively as technology and digital tools Artificial Intelligence (AI), enables everyone who seeks to improve and grow in every profession.
In a keynote address, Olorundare Sunday Thomas, the Commissioner for Insurance, National Insurance Commission (NAICOM) represented by Ajibola Bankole, Deputy Director at NAICOM, noted that, though there has been a notable progress in the sector evident by positive market performance at the close of 2023, however it’s not yet hurray!
The CFI said NAICOM’s milestone of N1.003trn gross premium income, representing about 27 per cent growth, recorded at the end of Q4 2023, compared to the N790bn recorded in 2022, should not be seen as the end of story because Nigeria’s insurance sector is still largely underexplored, with the industry’s penetration at less than one per cent of gross domestic product (GDP).
He laid bare the insurance performance spreadsheet for operators to ascertain that there are more miles to cover, a burden for all stakeholders to do more since insurance inclusion studies approximated that only 1.5% of Nigerian adults are covered by insurance today. A sign that most Nigerians lack the requisite knowledge about the relevance of insurance in their lives and businesses.
Besides, he said the data from the studies also compels the Commission to act more to improve insurance adoption, by creating enabling regulatory environment, streamlining regulations, encouraging innovation, and promotion of fair pricing practices for inclusive products. NAICOM he said, wants insurance companies to embrace this shift by: leveraging technology, developing inclusive products, investing in alternative distribution channels and prioritizing customer education. “Let us also prioritize education and awareness campaigns to empower individuals with the knowledge they need to make informed decisions about risk management and financial protection,” NAICOM boss affirmed.
The Commissioner maintained that as part of the NAICOM’s Financial Inclusion drive, the Commission has issued new operating licenses to new Micro insurance and Takaful Insurance operators and revised Guidelines on Bancassurance, Web aggregators and provided a Regulatory Sandbox to help drive more inclusiveness for insurance.
With a broader view of the industry he said, “The landscape of insurance is evolving rapidly, presenting us with both challenges and opportunities. From climate change-induced risks to emerging digital disruptions, our resilience and adaptability will be tested” he added.
Speaking on the aforementioned theme, MD/CEO of Royal Exchange General Insurance, Mrs Ebelechukwu Nwachukwu, poked operators to attract more Nigerians into the insurance net with evidence and proof that insurance is not a scam but a reality and a rewarding venture in Nigeria.
According to her, the perceived lack of trust and confidence in insurance business by most Nigerians dates back to decades, and not a few of Nigerians are ready to let loose of such perception, however the sad narrative is refutable if only operators persist on dishing out the current realities and the right testimonies.
Nwachukwu believes that with time, the ugly tale about insurance would be changed and the image redeemed if all stakeholders continue to preach the true gospel of insurance. “Insurance should not be forced on people. They should see the need and necessity, by that they will consciously embrace insurance.
“We have to send a message that insurance is a culture and culture is insurance. Insurance is a tool that every Nigerian must consider the subject matter as more of inclusive insurance. The insurance sector is including all other sectors and will continue to do so,” she submitted.