THE Insurers Committee has differed on how to carry out its much-publicised N300 million insurance industry rebranding project.
The group with umbrella bodies, Nigeria Insurers Association (NIA), Nigeria Council of Registered Insurance Brokers (NCRIB) and Institute of Loss Adjusters of Nigeria (ILAN) as members, disagreed over the sharing formula of the project expenses and which operator will be most favoured from it.
The committee comprises the National Insurance Commission (NAICOM), chief executive officers(CEOs) of 58 insurance firms, over 400 broking firms and loss adjusters.
The project, aimed at deepening insurance awareness and penetration, is expected to raise the industry’s paltry 0.2 per cent contribution to the nation’s Gross Domestic Product (GDP).
An initiative of the National Insurance Commission (NAICOM), it inaugurated by the Finance Minister, Mrs Kemi Adosun. It was expected to commence last October, but was stalled when the group could not raise the required funds for the project.
But it became clearer during the conference held by the IICC in Abuja when participants were told that that all was not well with the plan.
The brokers said their interest would not be protected, going by the arrangement in the project and as such, would not commit their cash to it. According to the brokers, publications and advertorials that will emanate from the campaign will only favour the underwriters in terms of public patronage.
NIA Chairman, Eddie Efekoha said the industry is challenged on the reputation, and brand, which arose from claims settlement.
He said he was worried that the rebranding meant to sensitise the public on the progress made by the industry was not on course.
He said if the brokers, underwriters and loss adjusters spoke with one voice about its benefits, the project would achieve its objectives.
He said it was agreed at one of the committee meetings that the brokers should contribute to it.
He noted that they might not be tasked at the same rate as underwriters but ”I think that their contribution would help so also the loss adjuster and at the end of the day, collectively, it would have been seen as an industry project and not a project of underwriters alone”.
President, Kayode Okunuren said the fear was that people did not know much about brokers and that the project had not been structured towards this.
He said as a result, they had decided to embark on the corporate visibility project to tell the customers the things that brokers could do for them.
He added that their concern was also about the alternative channels of insurance distribution in the industry which might not be in their interest.
He said: “We believe that we have not been consulted on how we will be carried along on the new distribution of channels opens by NAICOM. We are also concerned about image and how the public see us.
“It is easy to sell policies to customers, especially to this other intermediaries. We understand that NAICOM wants to create the alternative channels but if there is no collaboration with brokers who is expected to commit funds to the project, I think we will be shooting ourselves in the foot.
“We are not against alternative channels of distribution because we know that it is all about creating value for our customers. We also want to create value for our customers. But it has to be a win-win situation for everyone and it won’t look as if we are been regarded as an unwanted specie which we are not. Brokers exist everywhere and they will continue to exist.
“We agree that ethically, we need to reform because it is affecting the image of not just the brokers but the industry as well. So, we have decided from now that there will be corporate visibility project and we will tell the customers the things that brokers will do.
Reacting to the NCRIB President’s comment, the NIA Chairman urged brokers to see the industry and push out messages for the industry.
“We should all do it together, including NAICOM, rather than one section taking the credit. If the brokers can do it on their own, the NIA, too, can certainly do it. In fact, we have been sleeping in the NIA because there was a fund created for sensitisation campaign, but the money is still in our account. We have not used it. We can use it tomorrow, if we decide to start. But we believe even when we do so, the business the brokers generate is equally for the underwriters and so we have interest in what happens in the sector.
“Today, about 90 per cent of our business come from the broking sector, but from all the conversation that we have had, we are saying that there is still more to do. We can grow this market by looking at the other side but let’s speak insurance generally. The industry therefore will be pushing penetration better than if we decide to go individually,” he said.
A prominent broker and Managing Director of Boff Insurance Brokers, Babatunde Olatunde-Agbeja, said it was true that they operate one industry, but that the public did not know the brokers as much as they expected. He urged them to rather focus on the industry.
“We, the brokers, found ourselves where we are because people do not know what insurance broking is about. It is true we are in the same industry, but when we find out that people don’t know who we are except those in the insurance industry, we decided to sell ourselves.
“What the NIA wants us to do in terms of advert about industry will make them think, it is all about insurance companies. The only way out, if NIA agrees, is for all insurance in Nigeria to be done through brokers. Then, we can take the project as an industry project and we will do it together. But if that is not the case, then we will continue to market ourselves in the industry.”
Commissioner for Insurance, Mohammed Kari, said the operators should see themselves as one – whether they are underwriters or brokers. He however noted that there was no way brokers would be taken as the only intermediary in the market.
“There is no law that says an industry must not have an intermediary or every business must be out in the hands of a particular intermediary. We will continue to have this problem, if the intermediaries feel that direct business is a threat to their lives.
“The customer has the right to choose who they buy a product through. Insurance can be sold through an agent, broker or direct. So, I don’t see anything wrong in the broker as a fraternity advertising their services. However, it was discussed at the Insurers Committee and was agreed that the industry market insurance and not different sections of the industry.
“We are not marketing underwriting, intermediation or loss adjusting but we are saying is, let us market insurance first, so that people can know about the benefit of insurance. This was the reason for the proposed campaign. Every attempt we have made to make the two sides understand their complementary nature has failed.
“We want to boost insurance contribution to GDP. We have created an additional distribution channel to boost penetration; what is wrong with that. The argument by the brokers, which they have confronted the Commission with is that their interest would not be protected. But I say, you have an interest and a stake in the industry. If everybody works together, the industry will benefit all. But if brokers and underwriters don’t want to work together, there is nothing we can do. We can only urge them to cooperate.
We, the regulator, will always support the industry in sensitising the business of the industry and will continue to urge you to work together,” he added.
