By Patience Saghana
INSURANCE and reinsurance companies may begin from now to prepare their companies for another reform which according to the Minister of Finance, Dr Mansur Muhtar, is imminent.
Dr Muhtar has stated that the nationâ€™s insurance industry would soon experience another reformÂ that would boost the importance of insurance sector in the development of the nation.
According to him, â€œInsurance industry will soon witness another reform.Â Insurance business is of significant importance for economic development than to allow unwholesome practices to deter its growthâ€.
The Minister of Finance dropped the hint at the public presentation of BGL Research and Intelligence publications on Getting banks to lend again in AbujaÂ recently.
Dr Muhtar remarked that the BGLâ€™s report provides the country fresh perspective and insight for the private sector and also make governance more transparent.
He noted that the reform in the banking sector was a prize to be paid for the nation to attain economic stability through a sound banking system while he said that governmentâ€™s searchlight would soon beam towards the nationâ€™s insurance sector to bring sanity to the industry.
The finance minister who admitted that the federal government had commenced the process of sanitizing the insurance sector further, noted that the huge pool of resources in the insurance sector should be protected by government in the interest of the insuring public and the nationâ€™s economy at large.
Mr Albert Okumagba, Group Managing Director of BGL Plc bemoaned the state of the nationâ€™s insurance industry, stating that studies had shown that of the estimated 20 million people in formal and informal sector across Nigeria, less than one million has personal insurance policies in spite of the huge population of 150milion people in the country.
He noted with disappointment the low insurance penetration of insurance in the country worst still, when the sector has is compared withÂ insurance industry in other Africa countries..
According to him, â€œNigerian insurance companies are accurately aware of their need to grow their contribution to the GDP as well as assure a leadership role in the African marketâ€™â€™.
He however, identified some of the challenges facing insurance companies in country asÂ market penetration; improved product distribution; local content policy especially on oil and gas; prompt claim settlement; competent management; corporate governance; innovative products; adequate technology and the competitive structure of the industry which, he said that was further compounded by the large number of insurance brokers>
He stated, â€œThe success of the Nigerian insurance industry to a large extent is dependent on resolution of these identified challenges particularly the enforcement of compulsory insuranceâ€™â€™.
Okumagba stated thatÂ BGLâ€™s strengths, capability and core competences are in the areas of economic research, sectoral analysis as well as equities and fixed income research.
The BGL boss affirmed that companyâ€™s desire to continually strive to provide extensive and innovative research with a balanced approach to both country and sectors, â€˜as well as our intent to identify and analyze government policies, financial information, strategic issues and trends that affect companies, industries, sectors, and markets on a regional and global scale has formed the premise and basis of this publication launchâ€™, he stated.