There is greater opportunity for insurance companies to collaborate more with the banking sector to deepen insurance penetration in the country as  some banks  gradually divest from their insurance subsidiaries.

To this end, the West African Insurance Companies Association (WAICA) in conjunction with TAF Consulting Group is set to hold a conference on Bancassurance and the benefits of mobile phones in the financial service sector.

The event which is sponsored by Milliman Actuaries & Consultants will hold in Ghana between October 23 and 26.

Managing Director & Actuary Serving Middle East, Africa & South Asia, Mr. Debo Ajayi in a chat with newsmen stated that resource persons at the conference will talk on the product strategy and how insurance companies can graduate in their relationship with banks knowing that the banks are not experts in insurance.

According to him, insurance companies will also be briefed on how to introduce banks to insurance and the type of products to use and also the same process in the banks, adding “How do you tailor your process to match that of the banks rather than telling the banks what to do.

You need to understand the bank and come up with the right solution that fit their situation. There is also the motivational model. How do you motivate them to make sure that the results are acceptable?

Ajayi stated that the second part of the training is on the use of mobile phones in the financial service sector as mobile phone has become very common even in the rural areas.

In his words “How can the insurance industry take advantage of the mobile phones to be able to impact even in the rural areas where they may not have branch offices where it may be too expensive to operate agency. So, we want to use the experience of Kenya. Experts from Kenya will tell us how they have done it in Kenya.

The penetration rate of insurance in Kenya is more than double that of Nigeria. They use mobile phones in premium collection, paying claims, paying commission. When you are starting a journey, through your mobile phone, you can buy travel insurance, you transmit the request and you get your confirmation and you are covered in Kenya.”

According to Ajayi, the aim of the conference is to talk on how to make it happen, the challenges and issues that it poses, the IT infrastructure that is required to support such system and the kind of product one can sell through that facility.

While noting that the motivational model for insurance in Nigeria is not robust enough, Ajayi said that it does not actually give the proper incentive to the distributor, adding “What may be considered as bribe in Nigeria is actually not bribe in other places.

It becomes bribe because it is not stated as part of the compensation on paper. So when you speak of motivational models in the case of bancassurance you want to make sure that you identify the role that you want each banks staff right from the front desk person all the way to their manager. What role do you want them to play and concentrate so that they are all working as a team?

On why the insurance penetration rate in Kenya is in multiple than that of Nigeria, the Milliman MD maintained that Kenya has a lot of multinational players, while the regulator in Kenya is more proactive engaging in industry issues coupled with the fact that the insurance association in that country is very active in promoting insurance and insurance companies.

On multinational players, he stated that it is beginning to come into Nigeria “So we expect a future in Nigeria to be better than the past.”

He explained that TAF is a UAE based consulting firm that is focused on helping the insurance and financial services sector to develop technical manpower and IT solutions. “They are focused on designing financial security strategy that fits the environment where they are required. Milliman is one of the largest actuarial firms in the world with over 54 offices globally. Milliman is also based in Dubai and serves Middle East, Africa and South Asia.”