Deepening insurance – The current speech by the President of the Nigerian Council of Registered Insurance coverage Brokers (NCRIB), Prince Babatunde Adeleke Oguntade, has as soon as once more, thrown to the fore the necessity to deepen insurance coverage penetration within the nation.
Insurance coverage penetration charge
In accordance with him, “The insurance coverage penetration charge in Nigeria stays abysmally low in comparison with its teeming inhabitants of over 200 million individuals. This can be a problem that we should collectively deal with.”
selling insurance coverage
Stakeholders have a essential position to play in selling insurance coverage consciousness and training. Deliberate efforts must be made to proceed to shine the sunshine on the significance of insurance coverage and the advantages it gives to people, companies, and the nation as a complete.
Insurance coverage performs a essential position in mitigating dangers and selling financial development in a nation.
Sadly, many Nigerians stay unaware of the advantages of insurance coverage, however by concerted efforts of the regulator, and different measures the trade has put in place, extra gentle will be shed on these necessary roles. It’s essential to proceed to convey information and data to the individuals.
Federal Authorities in growing Nigeria’s infrastructure
It’s worthy of notice the efforts of the Federal Authorities in growing Nigeria’s infrastructure.
The federal government’s dedication to investing in essential sectors equivalent to transportation, vitality and housing is laudable. Initiatives just like the Nationwide Built-in Infrastructure Grasp Plan (NIIMP) and the Financial Restoration and Progress Plan (ERGP) exhibit the federal government’s dedication to bridging the infrastructure hole in Nigeria.
The large expenditure of the federal government on constructing a number of highways, railways on this yr’s price range is so as.
Nonetheless, there may be agency perception that insurance coverage can play an important position in mitigating the dangers related to developments of this nature, and selling financial development. In executing these laudable initiatives, we should emphasise the significance of making certain that these initiatives are adequately insured.
Insurance coverage is a essential element of any infrastructural
improvement/initiatives, because it gives monetary safety towards unexpected dangers and losses.
The NCRIB has been working tirelessly to advertise the event of the insurance coverage trade in Nigeria. “We have now engaged policymakers, regulators, and different stakeholders to create an enabling surroundings for insurance coverage to thrive. On this regard, I wish to commend the Nationwide Insurance coverage Fee (NAICOM) for its efforts in selling the expansion of the insurance coverage trade,” Prince Oguntade mentioned.
Deepening the insurance coverage penetration charge in Nigeria, with its giant inhabitants, requires a multifaceted method that addresses cultural, financial, and infrastructural challenges. Some methods to realize this embrace growing consciousness and training by public campaigns. Launching large consciousness campaigns to teach the general public about the advantages of insurance coverage, addressing misconceptions and cultural boundaries will improve the expansion of the trade.
use of cellphones and digital apps to promote insurance
Incorporating insurance coverage in training by introducing insurance-related programs into the curriculum at secondary and tertiary ranges generally is a increase, simply as leveraging neighborhood leaders by collaboration with spiritual and conventional leaders to construct belief and promote insurance coverage amongst communities.
Leveraging know-how through cell platforms through the use of cellphones and digital apps to promote insurance coverage merchandise and course of claims, given the excessive cell phone penetration in Nigeria, will be of immense benefit to tackling the problem.
Microinsurance gives low-cost,
Digital microinsurance merchandise that cater to low-income earners. If adequately developed by making it accessible to subscription by individuals on the decrease rungs of the ladder, it may assist to deepen the penetration of insurance coverage within the nation.
Additionally, by knowledge analytics, through the use of know-how to know buyer habits and tailor merchandise to swimsuit their wants, the sector can profit so much.
Growing tailor-made merchandise related to the tradition can play an important position in rising the sector. Merchandise that align with the socio-cultural and financial realities of Nigerians, equivalent to well being, agriculture, and funeral insurance coverage must be designed. This must be along with making obtainable versatile fee plans by the introduction of versatile and inexpensive premium fee buildings, equivalent to every day or weekly contributions.
Partnerships and collaborations –
Banks and Telecoms ought to companion with monetary establishments and telecom corporations to distribute insurance coverage merchandise. Working with authorities our bodies to combine insurance coverage into social safety programmes (e.g., medical health insurance for casual staff) is an effective step to take.
Non-public Sector Engagement:
Collaborate with companies to supply group insurance coverage for workers and members of cooperatives, and strengthen regulation and belief by improved claims processes by simplifying and expediting declare settlements to construct belief within the insurance coverage trade.
Implement Obligatory Insurance coverage:
Strengthen enforcement of necessary insurance coverage insurance policies like motor insurance coverage and group life insurance coverage. That is already within the offing because the Nigeria Police Power has introduced its readiness to start enforcement of the Third-party motor insurance coverage coverage from February 1, 2025.
A well-articulated insurance coverage regulation can improve insurance coverage penetration. Already, the much-expected Insurance coverage Legislation, it’s no extra information that the Invoice has acquired a substantial recognition by the 2 arms of the Nationwide Meeting, and the stakeholders predict a beneficial Legislation on the finish of time. Previous to the passage, they’d actively engaged with policymakers, trade stakeholders, and different related events to advocate for the passage of this essential laws.
In accordance with the NCRIB President, “The Insurance coverage Legislation will promote a extra conducive enterprise surroundings for our members and the trade at giant, and we’re dedicated to seeing it to fruition. Allow me to restrict my report on this specific topic to what had been reported. All of us hope that on the finish, the whole lot will prove within the favour of your complete insurance coverage trade”.
Shopper Safety: Strengthen laws to make sure transparency, shield policyholders, and penalise defaulting insurers.
Goal the Casual Sector: Since a good portion of Nigerians work within the casual sector, insurers can companion with commerce unions and cooperatives to supply group insurance coverage. Use casual financial savings methods (like esusu and ajo) as channels to promote insurance coverage.
Increase distribution channels:
Use different distribution strategies, equivalent to microfinance establishments, shops, and agent networks, to achieve distant and underserved areas.
Incentivise insurance coverage adoption:
Present tax incentives for people and companies that buy insurance coverage, and supply reductions on premiums for bundled or long-term insurance coverage insurance policies.
Leverage the youth inhabitants:
Goal the youth inhabitants with inexpensive and interesting merchandise, leveraging their familiarity with digital instruments.
Give attention to reinsurance and threat pooling:
Strengthen reinsurance capability to extend the power of insurers to underwrite giant dangers. Set up threat swimming pools for industries like agriculture and pure disasters.
A mix of those methods, and dealing with stakeholders within the Nigerian insurance coverage ecosystem can foster better belief, accessibility, and relevance, finally boosting the insurance coverage penetration charge.