The DG said insurance firms needed to go beyond designing services and products to suit only the corporate world and listed some policies that could be developed as single ladies insurance, single men insurance and lost income insurance.
For instance, he said: “Women tend to want to get divorce; moreover, life is so unpredictable; this will help to compensate for the inevitable financial consequences that accompany challenges from such directions.’’Thomas noted that: “Insurance practitioners have not been able to flood the market with enough risk covers and this is a major reason researchers described Nigerian insurance sector as grossly untapped.’’
He added that less than one per cent of Nigerian housewives had insurance cover, even though the industry had been in existence for close to a century, and emphasised the need for operators to shun the current trend of unhealthy competition among themselves.
According to him, “This unhealthy competition has seen many of the underwriters charging premium rate that is as low as one per cent while others charge at 0.85 per cent rate instead of the standard rate.
“This is not good for our industry. However, if the N16 trillion total asset base target for Year 2020 is to be realised, the employment in the industry would move from 10,000 to generating not less than 300,000 employment opportunities per annum.
“It would also increase the contribution to the Gross Domestic Product (GDP) from the current inconsequential 0.3 per cent to 15 per cent,” he said.
The President and Chairman of Governing Council, National Institute of Marketing, Nigeria, Ganiyu Koledoye, in his future outlook, said Nigeria’s population presents a gold mine for the insurance industry.
According to him, “We are sitting on a gold mine but the challenge we have is that we are looking at it as small money. The industry will expand rapidly if practitioners de-emphasised the practice of concentrating on large corporate accounts while neglecting the retail aspect of the insurance business.
“Unless the industry realises the fortunes in retail insurance, the contribution of the sector to the GDP will remain abysmally low.” His position collaborates with recent views of some analysts that the nation’s insurance industry could generate about N300 billion annually if 10 per cent of its 170 million population take at least one retail insurance product offered in the market.The analysts believe that 15 million policies from life, health and asset-linked policies of at least N20,000 per annum or $10 premium per month would deliver an industry premium that would change the fortunes of the sector and increase its contribution to Nigeria’s.
The sector, according to the analysts, is currently generating N50 billion annually from retail insurance, which they described as abysmally low, considering the population size and potential to risk exposure.
Consequently, they see this as challenging operators to put on their thinking caps so as to capture the existing market through innovative products and aggressive marketing.
The Managing Consultant, Human Resource Nigeria Limited, Rotimi Okparise, said the potential of the Nigerian insurance sector is huge, stressing the need for collaboration and far-reaching strategies to develop the retail market.
“The growth of the insurance sector lies within the retail market, as concentrating efforts on corporate businesses, which have remained the same over the years, would not yield the needed result and the industry would not go far in its efforts to contribute to the nation’s GDP,” Okpaise says.
This segment of the market presents the insurance industry with an exciting opportunity of providing a needed service of financial inclusion/protection and simultaneously increasing the sector’s contribution to the nation’s GDP.
Culled from: TheGuardianNigeria