Managing Director of Valid Insurance brokers, Mallam Idriss Abbas in this interview with Patience Saghana says insurance clients must consult the lead if they want a good run for their money. He also says the number of insurance brokers in the country is still relatively small.
Is a broker a friend of insurance consumers?
A broker is the best friend of any client in any insurance transactions because if you patronised the broker it takes nothing out of you. You don’t pay a broker to work for you. It is part of the premium that you pay that goes to the broker as his commission. So, it is in the interest of the insuring public to patronize the broker.
A broker is the best person that can tell a client the conditions in an insurance policy that are inimical to his interest. And the process of processing a claim is also off the neck of the client because it is the broker that handles that also. The insurance company is in business to make money and the more claims they pay, the bad business it is for them and the investors who want to maximize profits. So, the broker protects the interest of the client from an insurance firm who tries not to pay claims.
Insurance brokers want to contribute more to the economy; employ more Nigerians, create wealth and add value to the lives of clients and citizens.
It has not been easy remaining in the business in the last couple of years. There have been challenges, especially when it had to do with upholding the ethics of the profession amid fears of losing clients or money. But we have remained very steadfast. And today, it has paid off as people relate with us better, knowing fully well that we are a company that would never compromise on any grounds. We want to be the broker of first choice by clients because of what we stand for.
The Nigerian economy from all available indices is really picking up. Government has done a lot with its drive to improve on the economy especially with its vision of growing the economy through Foreign Direct Investment (FDI). And there has been significant flow of FDI into the country in the last couple of years.
The reforms of the insurance sector have equally boosted the chances of insurance operators to contribute to the growth and development of Nigeria’s economy. The capital base has increased from about N30billion before the recapitalisation to over N600billion now. So, with this strong financial base, the insurance industry is positioned to offer significant value to the nation’s economy.
There is still a lot of untapped market in Nigeria. And at the root of why many Nigerians are not taking up insurance is ignorance. Many Nigerians don’t understand what insurance is all about and understanding the business is very important. It will be wrong to patronise a product that you don’t understand.
So, we have a lot of work to do; we have to really be committed to serious enlightenment and education of the public on what insurance is all about, especially its benefits to policy holders.
From my perspective, I believe very strongly that insurance operators in Nigeria need to do something fast about their marketing approach. It’s important. I feel the industry as a whole or a majority of the players in the industry should joins hand to re-strategize on their marketing activities, so that more awareness could be created about insurance in the country.
It is a serious issue because there is a lot to be done in the area of advertising and branding by operators.
Are insurance brokers not too many in the sector?
I do not think the market is over crowded with brokers; this is because l do not think the entire insurable assets of this country are insured. It is my estimation that not more than 45percent of it are adequately insured. In this regards when you divide 600 Brokers and apportion this 45percent to all of them, it is nothing significance. The main problem is that we do not research and develop new products.
We keep chasing one traditional big account to another. Every insurance broker want to be in Nigerian National Petroleum Corporation (NNPC), the Federal Government’s Group Life, etc. We refuse to be dynamic and innovative and that is why we concentrate mainly in the urban cities of this country.
There are still some state capitals that have no presence of a broker or underwriter, and that will continue to take us back ward if we cannot show our presence in rural areas. How then will they know what we are doing? How can they buy our products? We must therefore wake up and develop and tailored personal-line policies for rural people so that they can appreciate our values.
Challenges for insurance brokers?
The Challenges are quite enormous. First we must love our profession and respect ourselves. We are faced with global challenges couples with our local challenges such as under pricing and unethical conducts, amongst others and until we addressed these issues, we may continue to go in circles.
What is your view about the sector’s market agreement?
The market agreement is one of the best things that happen to the insurance industry in recent times and l quite support that. I only hope that every practitioner in the sector will abide by it. We should learn to follow and agree on whatever the market consented to.
Like l earlier mentioned, unless we blow our trumpet, nobody will blow it for us. So if we do not respect our agreements and ourselves, nobody will respect us. It came to a point where clients dictate rates to operators irrespective of the industry’s maximum Probable Loss Assessments. That was very ridiculous.
Therefore the market agreement must be respected and all the parties should abide by it.
What is the compliance level?
There is no point, The Regulator must ensure that every operator in the market sticks to the rules in the market agreement wholly and whoever derails should be punished accordingly. That will bring us back to our norms and culture.
What share of the market has Valid Insurance Brokers been able to grab?
Valid Insurance Brokers is relatively new in the market. We are striving to be in the forefront by following the rules of the game. We are not in haste to be in those juicy accounts. Our marketing strategy is driven through referral.
We do not wish to jump the fence. Though, we are not yet in the so called big accounts because our focus for now is on micro economic activities. We want people to understand our role so that they can give us a lead to wherever we want to go.
Abuja branch office?
We open our Branch in Abuja in order to bring our services closer to the door steps of our clients in that environment.