The Nigerian insurance market is currently ranked 60th in the world. However, the Nigerian government envisions an insurance industry that can rank amongst the twenty largest markets in the world by the year 2020.
According to experts, achieving these goals will mean the insurance industry wholly embracing financial inclusion as well as developing the technical capacities to meet the emerging challenges of financial inclusion and micro-insurance. Hence, this therefore calls for more dynamic strategies to deepen insurance reach amongst the vast populace.
According to Commissioner for Insurance, Mr. Fola Daniel, insurers must change their marketing strategy; product design and packaging must change; approach to policyholders and their complaints must change and all hands must be on deck to ensure that the message of insurance is taken to the grassroots.
Daniel said, "If we must move the insurance market from its present level to an optimal pedestal within the financial services sector, then there must also be a consensus on how best to tackle the challenges. We have a lot to offer but we seem not to be taking advantage of the huge potential before us. The fundamentals for thriving insurance industry are there in the country -a vast population, an active economy and a well-capitalised industry."
The insurance Commissioner noted that the microinsurance sector around the world has grown rapidly over the past 10 years and is expected to double by 2020, producing coverage for over one billion people. Thus, with the right products, microinsurance would herald the much desired quantum leap in the industry. This significant growth brings new and exciting innovations in products addressing health, agriculture and property insurance, Daniel said.
Daniel also said that value-added aftersales services, especially efficient and timely claims settlement will aid the quest of repositioning the insurance industry as the pivot of economic growth and enhanced development.
Meanwhile, contained in the communiqué of its 2014 insurance educational conference, the Chartered Insurance Institute of Nigeria, CIIN, stated that the arms of the industry should set up a committee with the role of developing a more dynamic strategy in deepening insurance contribution to the nation's GDP in line with the rebasing of the economy as the current contribution of insurance to the economy is too low to be meaningful.
According to the CIIN, the functions of the Nigerian Insurance Industry Consultative Council should be extended to include that of serving as a lobby group for the industry as well as a platform for the pooling together of resources for the development of the Nigerian insurance market.
The CIIN also stated that the Nigerian insurance industry should key into the government's policy of promoting financial literacy through aggressively promoting micro insurance and takaful insurance products while market operators should put in place machinery for growing the insurance business in Nigeria through service centred mass production of insurance products and mass marketing of the products.
The CIIN also stated that insurance operators should work hard towards discouraging weak governance and transparency in their operations especially in the area of poor quality and timeliness of accounting and disclosures.
According to the CIIN, financial inclusion is achieved when adults have easy access to broad range of financial products designed according to their needs and provided at affordable cost. To this regard, the Nigerian insurance industry operators should work towards developing programmes that will facilitate insurance literacy among the publics.
"People are the most important assets of an organisation and as such, the trade arms of the industry should through the process of self regulation, persuade their members to regularly develop this asset in the organisation for the good of the entire industry," CIIN stated.
While condemning the existence of fake insurance market in the country, the CIIN asked the National Insurance Commission and the law enforcement agency to work towards the elimination of the market.
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