Insurance practitioners in the country have been admonished to come out with more dynamic products. Mr. Wole Oshin, Chairman of the Nigeria Insurersâ€™ Association (NIA) has challenged insurance companies on product development.
Though Oshin commended the efforts of insurance companies on new products development, but advised them to be more aggressive in the area of product development. â€œWe have compared with the emerging market such as Indonesia, Malaysia, South Africa, etc.
And what I discovered is that in scope and reality the problems we have here actually are sectional problem, because we have a fragmented industry. We have an industry where pension was hitherto the exclusive preserves of the insurance industry. It was yanked off our book in 2004â€.
Today, the funds available in that sector are over one trillion naira. Now, when you look at that alone, if you compared us with South Africa, is pension not part of their insurance business? Are you comparing life with pension?â€
Similarly, on health insurance, it is part of insurance industry in many other countries. So, when other countries talk about their premium, it is all inclusiveWith innovative and appropriately priced products, coupled with aggressive marketing, we can break through in the efforts to reach the grassroots,â€ Oshin said.
The truth, however, remains that the recapitalization and consolidation of the insurance sector has thrown up fresh challenges for the industry.
Mr. Remi Olowude Executive Vice Chairman of IGI posited thatÂ â€œThe development of the African market depends very much on its ability to create new products which would generate additional income. Today, premium income has not shown appreciable growth in real terms. Old policies are often repackaged and renamed and soon after they are launched, they fade away into oblivion like any venture that is not based on serious research.
Olowude stated, â€œIn particular, African insurance practitioners need to focus on insurance products that can meet the needs of the poor who basically reside in the rural areas. These products include, but not limited to, health insurance, micro-insurance, agricultural insurance and other products that can alleviate poverty and promote small and medium-scale enterprises.
The IGI boss added, â€œBrokers have even a greater role to play in this regard, on account of their intermediation, which involves interactions with insurance companies on the one hand and with consumers, both potential and real customers as well as their proximity to the grassroots.â€
Mr Sunny Adeda, president of the Chartered Insurance Institute of Nigeria (CIIN) submitted that operators in the insurance practitioners should endeavour to enshrine good corporate governance and best practices like a daily guide.
Adeda stated that the sector has continued to gauge the pulse of developments in the financial services sector and, especially the global financial realities, which have made obvious, the vulnerability of the economies of nations, including Nigeria.
He added that the CIIN will continue to encourage insurance companies to continuously review their manpower requirement by adopting a proactive approach to recruiting new entrants into the industry from the stock of young brains across the nation. This is in tandem with CIINâ€™s project 5,000 which is aimed at boosting the industry human capital status by recruiting first class brains from tertiary institutions in the country.
As the regulatorâ€™s Market Development and Restructuring Initiative (MDRI) is currently occupying the attention of operators, with emerging reflections on the way forward, he said there are overwhelming reasons why the insurance sector should re-define its operations in line with the MDRI, especially in regard to the six compulsory insurances and the efficacy of the agency system.