The Nation Newspaper

Category: Insurance

  • Insurance penetration to decline as 9,000 agents battle licence renewal

    Insurance penetration to decline as 9,000 agents battle licence renewal

    It appears the insurance industry is making sales on one hand and losing it on the other hand. Omobola Tolu-Kusimo writes on the lingering crisis.

    The inability of the National Insurance Commission (NAICOM) to resolve insurance agents’licence renewal issue is causing a decline in the penetration drive.

    At present, no fewer than 9,000 registered insurance agents are struggling to renew their licences to enable them operate in the market as mandated by NAICOM. They are unable to renew their licence because they cannot upload their documents on the NAICOM portal.

    As a result, thousands of the agents are abandoning the industry and seeking greener pastures in other sectors like real estate, among others.

    Insurance agents are critical to sales at the grassroots, a market yet to be fully captured by the industry. Consequently, insurance penetration rate  remain abysmally low standing at 0.3 per cent for almost a decade.

    The Minister of Finance, Budget and Planning, Zainab Ahmed, had urged insurance operators to address the low contribution of the sector to the country’s Gross Domestic Product (GDP).

    Inaugurating the NAICOM’s portal in Abuja, Ahmed noted that the sector, which had huge potential, contributed just 0.88 per cent to the country’s GDP in 2021.

    She said the current insurance penetration, a measure of the contribution of insurance to the Gross Domestic Product of 0.88 per cent for 2021, is very low, indicating low insurance sector development contribution to the national economy.

    Unfortunately, the agents whom are crucial to the deepening of penetration are losing interest in the insurance business daily due to the regulator inability to resolve the lingering problem of license renewal.

    It was also learnt that the umbrella body of agents, the Association of Registered Insurance Agents of Nigeria (ARIAN) had communicated to NAICOM through a letter about eight months ago but did not get a response till date.

    The struggle to renew license, it was learnt, arose from their inability to scale the submission process hurdle after submitting the necessary documents for license renewal through the NAICOM portal.

    Without the renewal, the agents cannot get a certificate from the commission and, therefore, cannot transact business. When they do, they will not be paid their commission by insurance firms as the certificate is needed before payment can be made.

    ARIAN President, Odewunmi Kazeem, during a meeting at its Secretariat in Fadeyi, Lagos, told reporters that of the 10,000 registered insurance agents in the country, only about 1,000 are able to renew their licences through the insurance industry regulator’s portal as mandated.

    The President, who was represented by his deputy, Jegede Olatunji, noted that the regulator had stopped manual submission for licence renewal last year, hence, directing every agent to use its portal for submission of documents for licence renewal.

    This, he said, they did, fulfilling   requirements, but that the submission couldn’t still go through, adding that complaints had been made to NAICOM but they are still awaiting response.

    This development, he further said, has negatively affected their businesses as insurance firms were not paying commission on businesses generated by the affected agents for fear of being sanctioned by NAICOM.

    To this end, he noted that some of the agents who couldn’t cope with this challenge had left the industry for other sectors such as real estate for business survival, at a time the industry is struggling to increase insurance penetration.

    While pleading with NAICOM to arrest this issue before it snowballs into a bigger issue that may sweep off more agents who were driving, especially, retail insurance, from the market, he pointed out that, their existence is at stake if the situation persists.

    He said: “I believe the Commissioner for Insurance, Mr. Sunday Thomas, has a listening ear and has been the driver of increasing insurance penetration in the country. So, every avenue to increase this penetration should be empowered to carry out their civic duty that will aid this ambition.

    “Registered agents are going through tough times as there is currently no much difference between registered and fake insurance agents. The inability to renew our licences has made some of us to lose businesses that we were facilitating before. The earlier the regulator could intervene, the better for us,” he pointed out.

    The National Adviser of ARIAN, Mr. Chinomso Eze said the body had written NAICOM about eight  and was awaiting response.

     adding that, ARIAN president had personally also reached out to the regulator on the issue.

    The National Treasurer, ARIAN, Jeremiah Okpako, disclosed that, the body would be ready for any intervention prescribed by the regulator as long as it will resolve the ongoing challenge.

    The Commissioner had earlier said the commission is looking at how to solve the issues around the agents not being able to upload on their portal.

    He however noted that in the interim and because of their income that may be locked up, the commission will move very fast to ensure they get their income.

    Efforts to get an update from NAICOM spokesperson, Rasaaq Salami on what the commission is doing to resolve the problem proved abortive as he declined to respond as at press time.

  • Norrenberger acquires 60% majority stake in the Infrastructure Bank

    Norrenberger acquires 60% majority stake in the Infrastructure Bank

    Norrenberger, an investor in insurance, pension and other sectors, has taken equity stake of 60 per cent in The Infrastructure Bank (TIB), having concluded the acquisition which began in 2019.

    The integrated financial services group, Norrenberger, made this known in a statement.

    Chairman, Norrenberger Group, Alhaji Ibrahim Aliyu stated that the Central Bank of Nigeria (CBN) approved the acquisition of 60 per cent controlling stake in the bank on March 10, 2023.

    He noted that the transaction followed the protocols and the regulators.

    He added the admission of private capital in TIB Plc’s equity as permitted in its establishment Act has created the first Public-Private Partnership (PPP) spectacle of reform and innovation in the infrastructure finance space in Nigeria and this would position the institution for greater engagement.

    He said: “The Infrastructure Bank PLC (formerly known as Urban Development Bank of Nigeria Plc) was established in 1992 under Decree 51, as Urban Development Bank Limited with the mandate to foster the rapid development of infrastructure across the country.

    The bank is a private sector-led, but government-sponsored development finance institution (DFI), whose previous ownership structure comprises the three tiers of government-federal, state and local governments, the Nigeria Labour Congress (NLC), and the private sector block.

    “As a group, this takeover marks a milestone toward Norrengerger strategic infrastructure mission. We look forward to leveraging this acquisition to bring about new opportunities and growth that will be beneficial to Norrenberger, the infrastructure space and the public.

    “In line with its establishing Act, the Bank has the mandate to raise and manage funds for infrastructure development projects in the country. Thus, the bank provides custom-made financial solutions to projects in its focus sectors namely transportation, power and renewable energy, mass housing and district development, urban infrastructure and municipal finance projects. The bank will also lend its expertise to contribute to discourse on development strategy, with associated policy formulation and guidelines.’’

    Chairman, The Infrastructure Bank, Alhaji Lamis Dikko said: “We are looking forward to a brighter future as part of the Norrenberger group.

    “This transaction brings a win-win for everyone involved, the Norrenberger group, selling shareholders, remaining shareholders and the infrastructure space in Nigeria especially at a time where the infrastructure deficit is huge.

    “Norrenberger has differentiated itself through excellent service delivery, and we will continue in that culture. I believe that the new umbrella under which The Infrastructure Bank will be operating will act as a springboard for us and our mission.”

  • ‘Turkey earthquake to cost insurers over $22b’

    ‘Turkey earthquake to cost insurers over $22b’

    The recent earthquakes in Turkey could cause insurance and reinsurance losses worth $2.4 billion, Catastrophe risk modeler, Karen Clark & Company (KCC) has said.

    KCC also puts the impact of the property losses from the two M7.8 and M7.5 earthquakes at about $20 billion, the majority of which coming from the first and larger M7.8 quake.

    Earlier, Verisk (AIR) said losses from the earthquakes that would be above US $20 billion, while the industry faces a bill of over US $1 billion.

    KCC noted that the damage to buildings, particularly those close to the quake’s epicentre, is, in part, attributed to intense ground motion acceleration, that the modeller says was “much more intense than the buildings were designed to withstand.”

    However, KCC also noted: “Much of the damage stems from poor construction practices and lax enforcement of building codes.”

    KCC provided additional information on the impacts of the earthquake:

    Across 10 of Turkey’s 81 provinces, the earthquake destroyed or heavily damaged more than 41,000 buildings, most of which were poorly designed or constructed.

    Of those 41,000 buildings, many were mid-rise multi-family residences constructed of reinforced concrete, though many commercial and industrial buildings were also destroyed. More than 35,000 people are reported dead from the earthquake, a number that’s expected to rise as search and rescue efforts continue. The death toll is now considerably higher than the 2011 Tohoku (19,759) and the 1999 Ismit (18,373) earthquakes.

    Historically in Turkey, reinforced concrete buildings tend to fail because of poor concrete quality and lack of sufficient longitudinal and transverse reinforcement. In addition, buildings in the region are more likely to have open ground floors, making them more susceptible to soft story failure.

    And, finally, weak links between columns and beams can lead to pancake collapse. Following the Izmit earthquake of 1999, Turkish authorities attempted to enforce building codes for new construction with more rigor, but most of Turkey’s buildings were constructed before that change.

    The most affected areas in Turkey were Gaziantep, Kahramanmaras, Malatya, Osmaniye, Iskenderun, Antakya, and Adana, with significant damage in Sanliurfa and Diyarbakir as well.

    The Commissioner for Insurance, National Insurance Commission (NAICOM), Mr. Sunday Thomas, while commiserating with the people of Turkey, said the effect of the devastating dual Kahramanmaras earthquake could erode about 2.5 per cent of the GDP of Turkey.

    Thomas, who spoke at an insurance forum on “Reshaping the Financial Sector: Emergent Challenges and Opportunities”, said notwithstanding the projections and targets, there was the dire need for a deliberate action to address events that could distort growth and development. Of importance to reference is Climate Change risks and sustainable Insurance.

    He said: “Sustainability is now more real than ever.The Africa Insurance Pulse 2022 reported that between 1970 and 2019, there were 1,695 natural disasters on our continent leading to loss of 0.7million lives and economic losses of $38.5billion.’’

    “The report also assumed a severe warming scenario and projected that Climate Change will reduce the global GDP Growth Per Capita by 2050. It has therefore become a misconception that we need not be concern simply because the Continent contributes among the least to global greenhouse gas emission”, he noted.

  • NCRIB: embrace registered brokers

    NCRIB: embrace registered brokers

    The Nigerian Council of Registered Insurance Brokers (NCRIB) has urged individuals and corporate bodies to embrace registered brokers.

    It said brokers could advise policyholders on the right cover for their risks as well as interpret the terms of  policies to their clients.

    Executive Secretary/CEO,  NCRIB, Mr. Tope Adaramola, said in Lagos that NCRIB was committed to ensuring insurance penetration in the country.

    He assured that the target of brokers was to generate as much as 90 per cent of premium income in the industry from 60 per cent.

    It would be recalled that the Nigerian Insurers Association (NIA) had said brokers facilitated 60 per cent of businesses in the sector in the 2022 financial year.

    Adaramola, who said brokers, have been active intermediaries in the insurance value chain, stated that the brokerage fraternity intends to further increase its contribution in terms of revenue generation in the sector to 90 per cent.

    He promised that brokers would not relent to increase its stake in the growth of the industry through its awareness programmes across the six geo-political zones of the country to enhance insurance penetration, adoption and acceptance in the country.

  • ‘Good governance, capital adequacy key to growth’

    ‘Good governance, capital adequacy key to growth’

    Chief Executive Officer, Centre for the Promotion of Private Enterprise (CPPE), Dr. Muda Yusuf, has called on regulators and stakeholders in the insurance sector to push for reforms to unleash the potential of the sector.

    He said there must be efforts to ensure consumer protection, corporate governance, capital adequacy and creativity and innovation.

    Yusuf said insurers must continue to drive adherence to high ethical and standards.

    Presenting a paper on theme: Reshaping the Financial Sector: Emerging Challenges and Opportunities at the Chartered Insurance Institute of Nigeria (CIIN) in Lagos, he said there is a very strong correlation between the performance of the economy and performance of the industry, which plays risk mitigation role for the economy.

    Speaking on how insurance sec-tor could support the economy, he said the quality of regulatory environment is critical to the stimulation of investment in any sector.

    Yusuf said: “Regulatory risk is one of the biggest risks in the Nigerian economy. Good regulatory governance focuses on ensuring a balance between three major interests, which include interest of investors; interest of the policy holders; and interest of society and public.

    “The industry in Nigeria is still in its infancy, despite being in existence for over 60 years. Good regulatory environment can make a whole lot of difference in the growth of the industry. There is the need for the regulator, the National Insurance Commission (NAICOM) to work on the weak insurance penetration; weak performance in the stock market; and low contribution to Gross Domestic Product  (GDP).”

    He listed the impediments to industrial growth as monetary volatility, unoptimised use of actuarial data, collective use of actuarial data should be encouraged, technology; product paucity, and trust

    The expert highlighted the industry strengths to be large population, large domestic economy with extremely low penetration and density, admission of new operators by supportive regulator, mature re-insurance industry; significant investment appetite by investors; and positive regulatory partnership and changes to develop pension savings.

    The opportunities, he said, include microinsurance products catering to low-income households and innovative distribution channels like InsureTech.

    He said the market is fragmented, noting that insurance is largely driven by statute, making it compulsory in many instances.

    He listed the weaknesses as low level of insurance on motor insurance and others, cumbersome claims processing; capacity for risk sharing, low purchasing power of the buying public, lack of awareness of life insurance and retirement income products.

    The threats, according to him, are inflationary pressures, deterioration in security, concentration risk, and shrinking insurance pool.

    For him, the path to progress in the sector is with active regulation that facilitates an industry where the insured are not denied their rightful claims.

    “The regulator should ensure consumer protection, corporate governance, capital adequacy and creativity and innovation.They should continue driving adherence to high ethical and operational standards, continuous monitoring of capital adequacy to prevent insurance firms from failing and promote the use of new generation technology and implementing standards to mitigate associated risk,” he added.

    He said the in-coming government must correct forex and naira policy crisis to reshape the economy.

    Yusuf said so far, there had been no forex reform, noting that cash is not the problem of the economy.

    He maintained that it is a misconception to say that 85 per cent of cash outside the banking sector is a problem.

    He stressed that cash is a payment instrument and should, therefore, be predominantly outside the banking system, not within.

    He said: “What matters is money supply, not cash. Cash is only five per cent of money supply. It is N2.6 trillion while money supply is N52 trillion. Cash to GDP ratio less than 1.5 per cent, which is one of the lowest globally. Cash is N2.6 trillion, GDP is about N250 trillion.”

    He stated that forex policy reform is imperative of market reflective exchange rate regime and enhances liquidity in the foreign exchange market.

    He said it also reduces uncertainty in the foreign exchange market and therefore enhances the confidence of investors. It is more transparent as mechanism for forex allocation; It minimises discretion in the allocation of forex; and reduces opportunities for round tripping and other sharp practices.

    He pointed out that the downsides of Nigeria’s forex policy has widened the gap between the official and parallel market exchange rates, collapse of liquidity in the foreign exchange market resulting in acute scarcity, mounting trade debts, and Increasing factory closure as many manufacturers are not able to access foreign exchange for raw materials and other input.

    He said the downsides have made many investors not able to meet offshore obligations, caused mounting inflationary pressures and led to sharp drop in capital inflows.

    “The good news is that we are in a transition period, so this is a good time to look at what we need to do differently because yes, the current administration has done its best. The sector regulators have done their best but we have an opportunity to refresh and sustain the good things and fix the bad things.

    On monetary and credit outlook, he said: “Look at concentration risk in the banking system and insurance sector regulation and the cashless policy. We didn’t know that cash and is so critical until the CBN decide to mop up the cash before we knew how important it is to the economy”.

    On Nigeria’s credit rating and implications for the economy and the financial system, he said there is need to improve the ratings.

    “All the major international credit rating agencies have been rating Nigeria. The outcome has not been too good which is a bad sign for any country that desires to attract investors.

    “Nigeria’s credit rating is poor with S & P rating the country B-, Negative Outlook; -Moody’s rating, Caal, Stable Outlook; while Fitch rated the country B-, Stable Outlook,” Yusuf added.

  • Customer service: Our experiences, by policy holders

    Customer service: Our experiences, by policy holders

    By Nimotalahi Awoniyi

    Insurance globally is an assurance against unforeseen and unfortunate loss.

     It is a contract where the insurer agrees to compensate the insured against the losses incurred due to any unforeseen contingency.

    The contract also involves a consideration which is called a premium.

    Under insurance, Third Party Motor Insurance is one of the compulsory insurance policies. This means it is the legal minimum level of motor insurance cover any motor vehicle owner plying the roads is required to have.

    In Nigeria, beyond that the Third Party Motor Insurance is compulsory, the benefits of the policy make it a must-have for every motorist.

    The policy takes care of the damage caused by the insured to the Third Party’s property or vehicle, also the Third Party’s medical expenses (if any) in the event of an accident, when the policyholder is at fault.

    Aside from Third Party Motor Insurance, there is Comprehensive Motor Insurance policy that takes care of damage caused by the insured to the Third Party’s property or vehicle and the insured’s vehicle.

    Unfortunately, many Nigerians are yet to embrace insurance as a risk mechanism tool, thus the neglect and non-compliance of the policy. Consequently, many do not have the mandatory Third Party Motor Insurance cover.

    Motorists’perspective

    While some motorists believe that insurance is good, others differ due to the poor perception they have towards insurance.

    A motorist in Lagos, Mrs Tola Adebanjo, on the other hand, said insurance becomes unattractive when insurance companies do not honour claims when it arises.

    She recalled that an insurance company denied her claim when it mattered most, citing flimsy excuses.

    Mr Olugbenga Awoniyi, on his part said, he had comprehensive insurance policy, but later changed it to Third Party Motor.

    He believes enforcing and educating people on the importance of insurance will help the government to boost growth.

    Awoniyi said: “I have a Third Party Motor, which I got in 2012 at N5,000 at Axa Mansard Insurance.

    “It was comprehensive at first, but I later swapped to third party. Insurance is good from my perspective because I had a case whereby my vehicle was hit twice and was repaired by the insurance company.’’

    Another policy holder said, Mrs. Kafilat Adepegba recounted: “I have a motor third party insurance which I bought from Mutual Benefit Insurance. I was involved in a crash with my car last year.

    “I hit someone and the insurance company repaired only the person’s car. I was pained. I wish I had bought comprehensive.

    “I believe having insurance is not bad, it helps in your most needful times. I also think that insurance companies should do more to enable more people key into insurance,” she added.

    But to Mr Owolabi Olayinka, it is also a goof story. “I have a motor insurance which I secured for my vehicles. It is comprehensive insurance and I was relieved when I hit someone because I know I have insurance that covers me. Both the victim and I got our vehicles fully repaired by the insurance company.

    “I think buying an insurance is the smartest thing to do whether life insurance or motor insurance. I hope insurance could be made compulsory so it could save lives and properties,” he noted.

  • NCRIB, ARIAN assure of compensation for victims of Lagos bus-train accident

    NCRIB, ARIAN assure of compensation for victims of Lagos bus-train accident

    The Nigerian Council of Registered Insurance Brokers (NCRIB) has assured that the  dependents of those who died in the accident between a bus belonging to state government and an intra-city train last Thursday in Lagos, who were insured, would be compensated by their insurance firms. Also, to be compensated are those who were injured in the accident.

    This was contained in a letter signed by the President of the Council, Rotimi Edu.

    According to the Council,  it was painful that many of the victims were Lagos State Government civil servants.

    The Council, therefore, urged better management of the railway authority’s level-crossing to avert similar disasters in future, especially in busy  areas.

    It, however, applauded the Lagos State Governor, Babajide Sanwo-Olu, for declaring a three-day of mourning and a cessation of electioneering campaigns in honour of the victims during the period.

    Also, the Association of Registered Insurance Agents of Nigeria (ARIAN) grieved with victims of the  train and Lagbus.

    In the communique signed by the ARIAN National President, Comrade Kunle Odewunmi, he expressed his condolences to the families of the dead as well as wished the injured speedy recovery.

    The intervention of the Lagos State Emergency Management Authorities (LASEMA)  as well as the visit of Sanwo-Olu and other  government officials to the hospital were highly commended, he added.

    He urged the road users and motorists to be cautious.

    Odewunmi, however, advised the  public on the need to explore the  benefits of insurance products.

  • Old Mutual: adopt insurance-backed savings plans

    Old Mutual: adopt insurance-backed savings plans

    Old Mutual Nigeria, a subsidiary of Africa’s financial services powerhouse, Old Mutual Limited (OML), has urged Nigerians to adopt insurance-backed savings plans to tackle prevailing global socio-economic volatilities, uncertainties, complexities, and ambiguities (VUCA).

    Its Executive Head, Marketing and Customer Experience, Alero Ladipo made this known in a statement to reporters.

    According to Alero, the capacity of an individual’s financial planning and security loses its fidelity in the face of continued market volatility, eroding the confidence with which they could predict the future.

    She stated that the reality is further complicated by the complexity of global exigencies, making it harder for experts to analyse correctly.

    She said these ambiguities and lack of clarity require all to make smarter financial decisions anchored on guaranteed wealth protection no matter what life throws at these trying times.

    She called on Nigerians to embrace Old Mutual Short-Term Saving Plan to guarantee wealth creation.

    She said: “This time-relevant Savings Plan helps you save funds to achieve your financial goals for the next two years, and it bears a competitive annual interest rate. It is even more remarkable that the plan provides a life cover of up to N1 million for a N5,000 minimum monthly premium contribution.

    “In other words, while we help you put away a reservoir fund for the rainy days, we also ensure that your beneficiaries are in a pole position to get an agreed compensation should life throw up the unexpected.This product brings peace of mind in these VUCA times.’’

    “The plan also provides flexibility that allows the policyholder to increase or decrease their monthly savings premium and risk cover at the policy anniversary. Customers can withdraw up to 50 per cent of their funds only once between six and 18 months and are free to surrender the policy if needed,” she added.

    “To ensure that its numerous existing policyholders and prospects can access the product conveniently and real-time anywhere in Nigeria, Old Mutual Nigeria has revitalised its website and other digital channels, such as WhatsApp, to enable seamless delivery of an immersive customer experience”, she added.

  • Insurance key to managing sustainable-related risks, says NAICOM

    Insurance key to managing sustainable-related risks, says NAICOM

    The drivers of the economy must adjust to the fact of the imajor role of insurance in the management of sustainable-related risks.

    Insurers are required to incept the conscious awareness of recognising environmental factors into  underwriting and investment strategies, the Commissioner for Insurance, National Insurance Commission (NAICOM), Mr. Sunday Thomas, has said.

    Thomas spoke while delivering a keynote address on the theme of the Year’s Business Outlook Conference: “Reshaping the Financial Sector: Emergent Challenges and Opportunities” organised by the Chartered Insurance Institute of Insurance (CIIN) in Victoria Island, Lagos.

    He urged that all hands should be on deck, as the commission was working on sustainable insurance strategy for the industry, which might at a minimum require institutions to report on implications of ESG risks and effect of climate change on portfolios.

    He stated that following the challenges, insurance, as a subset of the financial services industry, is a pivot to guarantee the sustainability of growth and development of the state and its people.

    He said it was, therefore, imperative to plant insurance at the centre of any equation that tends to enhance, sustain and manage the growth and development in any economy.

    He noted that it is, however, paradoxical to situate the theorised Demand-Following Hypothesis that suggest that insurance has become more of ancillary but not in the first line of thoughts, especially by an average man.

    Thomas said: “Looking at the results of last year, including a market GWP of N730 billion, are the things we could have prevented or done better. What are the strategies of addressing the challenges encountered in 2022? The answer to part one of the above questions might have been “a Yes”, hence the parameter underlying the 2023 projections has been seen to positively deviate from the projections in the National Development Plan (NDP) 2021-2025. It is to this extent that they have been updated based on the combination of realities and a modified medium-term outlook.

    “The Minister of Finance, Budget and National Planning during the 2023 Budget Presentation stated that the real Gross Domestic Product (GDP) growth is projected at 3.75 per cent in 2023 compared to 4.39 per cent in the NDP;  it was also projected that growth is expected to moderate to 3.30 per cent in 2024 before picking up to 3.46 per cent in 2025.

    “Also, the National Economic Council (NEC) at the first and emergency session of February 14, 2023 presented the Nigeria Agenda 2050 with the objective of taking the Country from Upper-middle income to the status of high-income countries.

    “Notwithstanding the challenges of high population growth rate, low fragile and non-inclusive economic growth, limited though improving diversification, low productivity and high import dependence, etc, the NEC has the target to have accelerated, sustained and broad-based growth; significantly improve the country’s per Capita GDP from about $2,084 in 2020 to $6,223 and $33,328 in years 2030 and 2050.”

    He also said notwithstanding the projections and targets, there was the need for an action to address events that were could distort the sustainability of growth and development. Of importanc is the climate change risks and sustainable insurance, he added.

    Thomas said: “Sustainability is more real than ever. The Africa Insurance Pulse 2022 reported that between 1970 and 2019 there were 1,695 natural disasters in our continent leading to loss of 0.7million lives and economic losses of $38.5 billion.

    “The need to grow and restructure the financial sector for sustainable growth must also be viewed with the lens of future impacts of our actions or inactions that may be capable of distorting our efforts as professionals in our various endeavours.”

    “It is on this backdrop that I wish that we all reflect on the United Nations Environment Programme on Sustainable Insurance’s Four (4) Principles of Systemic Change, as well as the Triple role of the Insurance Industry in Sustainable Development i.e. Risk Management Role (Physical Risk Management); Investor Role (Asset Management); and Core Insurer Role (Financial Risk Management). I believe the various experts will do justice as the sub themes of this program requires”.

    He maintained that one of the benefits of our annual budget is the instrumentality of adjusting to current realities and projecting into the next one year without being boxed into a long- or medium-term strategic intents, noting that this is necessary to redistribute resources, alter long term plans, moderate the impact of unforeseen disruptors and plan.

    Thomas is optimistic that the CIIN conference will afford insurance operators to discuss the 2023 Budget and the stake for them as a sector.

    “The 2023 Budget is of Fiscal Consolidation, Sustainability and Transition which intends to facilitate macroeconomic stability and achieve some strategic objectives of the NDP. We are invited to note that the 2023 budget assumes, amongst others, 17.16 per cent inflation rate, 3.75 per cent gdp growth rate, official foreign exchange rate at n435.57 to a us dollar, crude oil sale at $75 per barrel and daily oil production at 1.69 million barrels per day.

    “What are the implications of these assumptions on our businesses? This is however not without extra caution also because Nigeria had not met its Revenue Target in recent past; There was under performance by about 25 per cent in year 2021. The implications of underpperformance in most scenarios would lead to increased borrowings thereby growing Debt Service Costs; the Financial Sector has therefore been saddled with the extra responsibility of ensuring expenditure efficiency; hence need for Financial Planning.

    “It is therefore imminent that financial planning of every individual, not just entities and businesses, should incorporate insurance as an integral part of the Plan. Furthermore, Insurance should take the first place in our Financial Planning owing to the crucial role it plays; Insurance as a risk mitigation tool prepares everyone for unforeseen circumstances and losses instead of enhancing unexpected borrowings.

    “Insurance Companies are therefore charged to take rightful place by not just supporting only from the back end but take the lead in financial planning of customers. This is however not without the need to increase understanding of the Customers’ businesses and further the course and boost the financial status of insureds.

    “It is the deep understanding of the customers’ businesses that aids insurers to gain insight into the financial status of the Customers thereby helping to market the right product, rather than struggling to Sell what had been produced. That is, “Develop Product that could be Sold” but do not “Try to Sell what had been Produced”.

    The Commissioner further stated that they have been exposed to the direction of the Government through the 2023 Budget and the focused Industries and as well as strategic expenditures that could enhance the Insurers’ prioritized markets for appropriate products that will ensure that insurance is seen in every line item of the budget.

    He stressed that the growth of an economy on a long-run basis (relational) is linked with activities of the insurance market. 

    “Borrowing from the research work of Abdullatif Alhassan and Nicholas Biekpe in exploring Causality Analysis, their findings reveals that insurance market development in economies that experiences supply-leading hypothesis is important for stimulating economic growth. Supply leading hypothesis postulates scenario where surplus spending units are channeled into financial market for usage by the deficit spending units.

    “The Nigerian insurance industry has the potential to be a major driver of advancing national development through freeing Government dwindling resources usually deployed to mitigate losses to citizens arising from fundamental risks and catastrophic events. It is expected that the ongoing development of the Insurance Industry 10-year development plan will be unveiled in the first half of the year for structured and inclusive growth of the insurance sector”, he added.

    CIIN President, Mr. Edwin Igbiti in his opening address said the Business Outlook Conference is a forum where key players in the industry as well as the finance sub-sector of the economy converge to review the business environment in the country for the immediate past year and strategise on the way forward in the new year.

    “This programme among other things, examines the national budget, reviews the thrusts of the fiscal and monetary policies of government and estimate how these would influence the insurance industry in particular and the economy in general.

    “This first session of this conference is expected to envisage the 2023 national budget, most especially the aspect that relates to the Insurance Industry and how the industry can reposition itself. The objective of this conference is to review business and financial activities, share ideas, project proponents for profitability and proffer solutions and recommendations to operational challenges in the country.

    “It is a platform to discuss the national budget as it relates to the financial sector, meet professionals from different professions in the financial world and share expertise on the issues pertinent to the growth and development of the Nigeria economy.

  • Linkage Assurance offers support to brokers

    Linkage Assurance offers support to brokers

    Linkage Assurance Plc has announced value support services that would enable its insurance broker partners deliver efficient services to customers across the country.

    In line with this, the company is unveiling digital service solutions and platforms that will enable partners reach that uninsured Nigerians.

    Managing Director, Linkage Assurance Plc, Mr. Daniel Braie, who made this known in a statement, said the company would be hosting over 300 brokers at the Nigerian Council of Registered Insurance Brokers (NCRIB) bi-monthly members’evening.

    He stated that the company would leverage the opportunity of the Council’s bi-monthly programme to break new grounds in its relationship with brokers.

    The event, which is scheduled to hold at the Insurance Brokers’ House in Lagos tomorrow, would be a hybrid of virtual and physical.

    He believes the platform has the potential that would culminate in better business relationship with the brokers that controls the largest chunk of insurance business.