Adeduro sees insurance potential in travel, tourism industry

Given the close relationship between insurance and the Tourism and Travel sectors because of the formers role in helping the later manage risks for business protection and survival, expert has advocated stronger partnership between the two sectors.

Mayowa Adeduro, an insurance expert and former managing director of Anchor Insurance Company Limited said both sectors must work together, come up with products that meet the risk appetite of the business, particularly now that tourism and travel business is becoming a major contributor to Nigeria’s gross domestic products (GDP).

Adeduro made the remark in a presentation with the theme “The corollary of tourism and insurance – why insurance industry should play an active role for sustainable tourism business in Nigeria”.

He said “Insurance industry in Nigeria must establish a formal connection to the Travel and Tourism sector for a mutually rewarding relationship. A special product must be designed for municipal and remote tourist sites.”

According to him, insurance industry lave lost billions of Naira in gross premium income from uninsured and under insured small and medium size hotels and recreational facilities scattered all over the federation. “Many visitors and tourists have suffered unreported losses and liabilities in some hotels and parks.”

He noted that insurance industry must team together to build a coherence and all inclusive arrangement with IATA Travel Agencies and NANTA members with potential to facilitate smooth operations of members of these trade groups.

“When risk is shared it becomes difficult, if not impossible, for chronic defaulters to run from one company to another, which has been the bane of profitable underwriting in some classes of insurance.”

He concluded by saying that insurance industry has a huge role to play in entrenching a sustainable tourism development in Nigeria, however nature abhors vacuum so the ball is in the court of insurance industry to take up proactive engagement or to lose yet another opportunity to be reckon with by the government and the insuring public.

As at 2016 insurance made a gross premium income of N350billion and contributed a paltry 0.6 percent to the GDP of Nigeria.

In the same period, Travel and Tourism contributed 1.7 percent to the GDP of Nigeria, while visitor exports of tourism in Nigeria was estimated at $800million.