NAICOM NOT AGAINST THE CORE INVESTOR OF NICON INSURANCE

Samuel

The Managing Director /CEO of NICON Insurance, Mr Bayode Samuel, in this interview with the Corporate Affairs Team, throws light on some burning issues. He talks about the transparency of the regulatory body as not being against the Core Investor, Dr Jimoh Ibrahim, CFR, and also sheds light on the journey so far as Chief Executive Officer of NICON. He throws a ray of hope to staff and clients. Enjoy the snippet:

1.  What in your opinion is the impact assessment of the insurance industry in Nigeria, in the last five years?

A lot has changed in the insurance industry in the last five years. The Regulator led by Mr Fola Daniel has really imparted the insurance practice in Nigeria. They have been proactive in regulating the activities so much so that a lot of sanity has been introduced. The International Financial Reporting System (IFRS) now has a platform to access each and every insurance company and this has helped to standardise the procedures, practices and the industry is for the better. So, I think, the last five years have been productive.

The industry has grown tremendously in the last five years from being almost an oligopolistic market to now becoming a free market. These are the things that have happened in the past five years. The one singular policy that was the biggest in Nigeria was Nigerian National Petroleum Corporation (NNPC) - Oil and Gas Account which used to be the exclusive preserve of NICON, but for like ten years now, leadership has changed. Sometimes the Industrial and General Insurance Plc (IGI), Custodian and Allied Insurance, Leadway Assurance Company Limited and all that, so much so that you are not sure who would be the leader. That means there is a lot of penetration in the insurance industry, now in terms of knowledge and acquired skills, so basically it has been ok.

2.  Lead us into the new NICON Insurance Limited. What is your vision for the organization?

In order for you to have a new NICON, you must look at the old NICON and what has changed. Like you said, NICON used to be a major player in the industry, prior to privatization, but privatization came with it a lot of ex-products from the clientele and it is natural. If you are compelled to insure or do business with someone, the moment the restriction is lifted that you are free to go anywhere, a lot of the clientele will move. That is exactly what has happened to NICON Insurance in the past. However, it need not have been that NICON will lose drastically their market share like that if active steps were taken to re-launch the company back as a private company, transiting from government organization. But certain things were not done so it led to terrible loss of accounts. So looking immediately to the future is to still ride on the strength of NICON which is the strong asset-base and a strong brand name, to be able to re-launch the company back to the zenith of insurance practice in Nigeria. If you still agree with me that the intellectual capacity, training of staff and all the quality of staff we had, a lot of them are still around and new staff are joining that have a lot of quality; so when we remodel and repackage the company, we are seeing a lot to happen very soon that will return the Company back to the most prominent insurance company in Nigeria.

    Again, we are talking about having a roadmap for the Company, and this roadmap will specifically tell you how you are going to navigate the rocky waters of the Nigerian economy; to specifically give tasks to critical managers to turn around the fortunes of the company. That is where we are now. We are expecting that we have the roadmap before the end of the year so that we can start 2016 on a profitable and clean slate, hitting the ground running.

3.  What is the market strength of the company?

The market strength of the company now is almost nil in terms of premium income. Our last report indicates that from a prominent place of 40 per cent, we are now in 0.4 per cent. You can now calculate the percentage change in negative, how it has come to that. You will then find out that even 0.4 per cent will be an optimistic guess for 2014 in terms of premium income.

However, the investment and asset-base of the company is still as solid as ever and even sometimes getting better because of the quality of such investments. Like I said, the regulator even confirmed that the top four companies in terms of premium income, when put together, their assets are not up to that of NICON Insurance.

4.  Is there hope of synergy among players in the industry?

Yea! A lot of players are synergising, if you allow me to use the word. But they see NICON Insurance as a big threat in the position NICON was, and what NICON can still be and do. Therefore, a lot of them that benefitted from all the businesses that exited NICON still do not want to see NICON come back. They rather prefer to synergize between themselves.

However, the industry’s Associations are becoming stronger, we are getting back into such Associations, like the Nigerian Insurance Association (NIA), the Africa Insurance Association (AIO) and the rest. The synergy will come back whether they like it or not.

5.  How has it been? Coping with the Regulators of the industry?

Well, like I said, the Regulator basically is not against you. It is only when you do not do the right things or submit the right figures that the Regulator will frown at you. And we have just debunked the myth that the Regulator is against the Core Investor. The Regulator specifically said, they are not against the Core Investor, because the same Core Investor owns Nigeria-Reinsurance Corporation. The 2014 accounts of Nigeria-Reinsurance Corporation has just been approved even before the end of the June mandatory date, so what are we talking about? It is just that we have not done the right things in the past few years; for the past 6-7 years, we did not submit the right figures. But thank God that a new Director (Finance and Admin) has come on board. He has taken the bull by the horn. The 2012 Account that was outstanding has been approved and the 2013 Accounts are about being submitted now. The one to be submitted before end of the year will be the 2014 Accounts, so that we can start 2016 on a clean slate.

6.  Is the ten year tenure proposal by NAICOM a welcome development to you?

It is a good development, you know. That is exactly what they did to the banks. I do not see any reasons why an Insurance Executive should spend more than ten years in office. Paranoia comes and you see, there are little things you tend to overlook when you sit in a place for too long. For example, it is only natural, if you are here and a rat dies, the moment you enter, you perceive the stench of the rat which died maybe in the ceiling and you sit down. By the time you are going, maybe after an hour, you may not perceive the stench as strong as when you came in. So it is just like that in the executive capacity. If you stay too long on a sit, certain lapses will be there which you would have been used to, which you may not be able to correct. But if a new man comes and views it, he will seek other solutions in his own perspective. I think it is a welcome development. To me, I think five years is enough for any Insurance Executive to make his mark and leave.

7.  What is the future of NICON in your hands, in the next five years?

The future of NICON Insurance is bright. I have been a part of NICON for years. Even when we were in school, we used to come to NICON Insurance for excursion. When we were Brokers, we were Brokers to NICON Insurance. When we had a very big pension scheme in Nigeria; we were part of it. We know NICON in and out. Having been here for eight years also, has shown me a lot of what could have been done better. Therefore, the future of the Company is for us to re-strategise, put the roadmap in place, and revive the fortunes of the Company to the extent that the Company becomes the leading player in the industry again. That is the future of NICON, and that is what we have started.

8.  How would you access yourself in terms of performance in the last six months?

Well, in terms of performance in the last six months, I can say we have not been able to do much. I will not score myself 50 percent yet. Because all the things that would have been done, the inherited structure has made it impossible for them to be done. You still find branches making nil return in a month; such things will have to give way. You still find marketers waiting for their salaries, having not contributed one kobo to the income of the Company. Where is the income coming from? You still find the infrastructure of the Company very weak-no telephone infrastructure, no IT infrastructure, no transportation infrastructure, and all that. These are things one would have wanted to put in place immediately; like yesterday. We started slowly, trying to renovate and re-establish the income earning potential of the head office. Of course, the income has not been commensurate with the challenges we met on ground so we have not been able to go far. But I would have loved to do more even though the constraints are there.

9.  What challenges have you grappled with to have come thus far?

The challenges are one, very many. We have inherited ill-motivated, disgruntled and untrained staff, and you know in whatever organisation you are working, or whatever economy you find yourself, human capital is still the number one capital. So once your internal customers are not loyal and are disgruntled, there is nothing you can do. That is where we have found ourselves. Even our part-time staff have full-time jobs elsewhere. They just use this place as a marking point, most especially in the branches. These are the things we inherited and are slowing down the revival of the company.

Two, dwindling income. Poor cash flow has not helped the matter. If a company is distressed and not doing well, the first index to know is the cash flow of the company. If there was cash and enough in the bank, we would not owe staff salaries. You will put in place infrastructure that will make your operations a class. If the cash flow were there, there are so many courses I would have loved to send staff, to retrain them, re-educate and re-orientate them. If the cash flow were there, you would not be riding a ten year-old car. If the cash flow were there, everybody will have a phone and a line; everybody will have a laptop and ipad to do their jobs. That is why we have started to restrategise in terms of bringing in the cash wherever we can find the cash. Some staff will complain why we sometimes make huge payments to places like immigration and prisons as outstanding claims, but those are strategies to bring back business and income.

     We have been engaging past staff who are Brokers and they are now ready and have been giving us businesses. That is how to get the cash in. You can also see in papers that we have been able to engage NCRIB, all those are ways of getting the cash in.

10.       How do you socialise, considering the pressure of your office?

For now, I do not socialise. You can see that I usually close from the office around 9pm, and sometimes beyond. The current state of the office does not permit me time for pleasure. By the time I fix things right, I can think of pleasure.  For now, there is no time.