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By Henry Uche, [email protected]
As 2024, a leap year takes off, stakeholders especially insurance consumers and policyholders have great expectations from the regulator – the National Insurance Commission (NAICOM) and operators of insurance business in the country.
Just as Nigerians expect top technocrats, industrialists and entrepreneurs to use their corporate governance policies and action plans to leapfrog the economy from austerity to prosperity, stakeholders in the insurance value chain expect the Commissioner of insurance, Mr Sunday Olorundare Thomas to kickstart the proposed 10-year strategic transformation roadmap to improve the sector’s operating landscape.
Mr Sunday Thomas had in 2023 launched the 10-year roadmap, which would run from 2024 to 2033, to revolutionise the industry with a well-coordinated implementation approach.
Thomas said that by 2033, insurance penetration, expected to move from the current rate of less than 1 per cent to 2.1 per cent, would substantially improve the rating of the Nigerian insurance market on the global map.
He noted that the industry would seek to continue its transformation journey along seven strategic thrusts with the objective of achieving the corresponding goals.
The thrust of the strategic plan, according to him, include transformation of the regulatory environment to sustain industry growth and transition to risk-based capital model.
It also involves promotion of insurance awareness and adoption, broadening of insurance product offerings, and improvement of the effectiveness of its distribution channels.
The strategy he said would also enhance industry digitalisation, deepening talent pool and capabilities, as well as support of the country’s economic transformation and sustainability agenda.
The commissioner said the performance and potential of the insurance sector over the years experienced an average steady year-on-year growth of 15.1 per cent in premium income.
This development, he keenly observed, is far below the opportunities provided by the Nigeria economy, as records indicate that the cumulative assets of the Contributory Pension Scheme (CPS) stands in excess of N17 trillion.
He stated that the sector was expected to maximise its share of the growing fund; hence, the need for stakeholders to support the government towards reviving the economy and de-risking individual and business ventures.
Thomas said: “Pursuant of the drive by President Bola Tinubu towards a thriving economy, the insurance sector must be strengthened to play its role in realising this laudable national objective.
“NAICOM is very mindful of our collective responsibility to ensure that insurance institutions prosper; for it is in that prosperity that lies our attainment of our regulatory objectives of safeguarding insurance.”
However, in separate interviews with some stakeholders in the industry, their demands were:
Radical awesomeness campaigns: Initiating public awareness campaigns to educate citizens about the importance of insurance and the benefits of various insurance products is paramount. This can help increase demand for insurance and drive growth in the sector.
Collaboration with Fintech/insure Tech: Encouraging collaboration between insurers and fintech companies to develop new and innovative insurance products, as well as streamline insurance processes through technology is key.
Data -driven Premium
If only potential and prospective policyholders can access and seamlessly pay relate with insurers particularly when paying premiums through the digital means and get instant responses, they would be glad they did. Digitalization saves a whole lot.
Corporation amongst operators
Synergy among insurance agents, registered insurance brokers, loss adjusters, actuaries and others with operators and the regulator is the bedrock to advance the course of insurance business anywhere in the world. These aforementioned stakeholders and others are expected work hand in glove to see that insurance assume its prominent position.
Sound Policies and regulations. Every stakeholder in the insurance value chain expects nothing less than sound Policies and regulations from the Commission. A fair play ground, pro- people and progressive guidelines, directive, control and leadership from NAICOM would engender rapid growth and development. This expectation no doubt has been seen in the Commissioner’s management, administrative and leadership style since he assumed office in July 2019.
Strict sanctions against defaulters. Without discipline, rules and regulations are as good as nothing. Enforcement of strict sanctions against defaulters and recalcitrant persons of corporates would make everyone to sit up for the business. Stakeholders said NAICOM should not a be a toothless bulldog but should not hesitate to raise the hammer against anyone (matter whose ox is gored) who dare try to smear the effort of the commission to raise the insurance business to enviable height.
Tailored products & services
Underwriters are expected to churn out products and services ‘fit and Proper’ for potential and prospective policyholders and communicate their offerings in a simple and clear manner, people would be interested to engage insurance companies without much persuasion.
Media strategic support.
Insurance correspondents are not the least in the order of priority. Because they’re very critical to governance of any country, the insuring publics expects the Media to go beyond conventional reporting (what newsmakers said) and dig deeper to unearth certain misinformation and misrepresentations of some corporate bodies in line with their professional ethics and laws and tell the untold stories. Insurance consumers said, “The Media should be the friend of the masses, not of the newsmaker” thus, they (Media) is statutorily saddled with the responsibility of saying that which the newsmakers do not want them to say, in the interest of the public.
In a chat with the president of Insurance Consumers Association of Nigeria (INSCAN), Yemi Soladoye, he urged the federal government to utilise the templates already on ground to turn Insurance to a veritable tool for Development Finance and Employment Generation in Nigeria, adding that NAICOM should implement the Market Development and Consumer Protection initiatives already put in place for the Nigerian Insurance Market in our various works done in collaboration with the World Bank, GIZ and the CBN.
For the Head, Corporate Communications at Chartered Insurance Institute of Nigeria (CIIN), Adeleke Adetunji, the Insurance industry is still grasping it feet in today’s dynamic and complex business environment, thus; companies need to prioritize good governance and compliance to maintain trust, protect stakeholders interests and ensure the industry operates in a fair and transparent manner.
He howbeit, said Nigerian government and insurance regulator can help insurers to upscale the insurance business in 2024 through various initiatives such as; Creation of conducive regulatory framework and environment that encourages innovation and growth within the insurance sector. This could involve updating existing regulations to align with the changing business landscape and international best practices.
Risk Mitigation: Working with insurers to develop strategies for mitigating risks associated with the Nigerian market, such as regulatory uncertainty, economic instability, and climate-related risks.
“By implementing these measures, the government and insurance regulators can play a crucial role in fostering the growth of the insurance industry in Nigeria in 2024” he posited.
