The insurance sub sector contributes a paltry 0.4% to the nation’s gross domestic product (GDP), making it the poorest when compared to other countries within the continent, experts have said.
Speaking at a public forum in Lagos, tagged: ‘Breaking The Code’ a cross-section of experts lamented what they described as the abysmally low penetration of the insurance sub-sector, stressing that this does not bode well for the economy.
Mr. Abiodun Atobatele, who spoke on the importance of communication to the insurance industry in Nigeria, commented that “There is need for a rethink in Nigeria insurance industry. If you take automobile insurance away, Nigerian insurance industry will die. Lack of innovation has brought unhealthy competition into the sector. The low innovation in the sector has adversely affected the industry. Insurance sector only contributes about 0.4% of Nigeria’s GDP, far less than Nollywood. Unlike South Africa where 80% of Africa’s premium comes from and accounts for 13% of the country’s GDP, while in Kenya insurance account for 3% of the GDP. So if insurance is taken away from the economy, Nigeria won’t go on recession.”
Justifying the need for the conference, the convener, Mr. Ekerete Ola Gam-Ikon said: “Breaking The Code’ was an opportunity for policy holders to share practical ideas that will improve the experiences with insurance operators.”
Pressed further, he said: “A lot of people see insurance as something that is more like a myth, a lot of people don’t understand what it means. If customers don’t understand it then the business is in the world of its own. The language of insurance must be broken down to the understanding of customers. The essence of the theme was to say if this is a code, let’s decode it.”
Speaking on investment in the insurance sector, Mr. Dienye Peterside, a financial expert who explored the various opportunities in the industry, observed that: “If the insurance company can step in by creating a product that will provide security for clients they are satisfied with or businesses they are happy with, it will shortcircuit a lot of steps that the financial services companies go through to provide facilities, and it will generate more income. The insurance companies need to open her eyes to new opportunities rather than going the traditional way. Insurance companies in Europe and America own banks which have branches in over 50 countries and they report to the insurance company. It’s the other way here, insurance companies are owned by banks before CBN regulated it.”
The event had in attendance investors and policyholders from various sectors including: Mr. Stanley Obinna Zebulun, President/CEO Venerate Capital, Mrs Edobong Akpabio of Organic Green Animal Farms, Mr. Abiodun Atobatele, Founder & Chairman, ATB Techsoft Solutions Group, Mr. Charles O’tudor, Brand Strategist/Principal Consultant, ADSTRAT Consortium, Mrs Ini Abimbola, Lead Consultant, ThistlePraxis Consulting Limited (TPC), Mr. Emmanuel Essien, Managing Director, Alpha Mead Capital (AMC) and Mr. Olubola Mark George, Chief Strategy Officer, Mark George Consultants.