Bankers, experts tie Nigeria’s economic development on strong insurance sector
Bankers and experts with vision for a faster economic growth and development have identified the need to reposition the nation’s insurance industry to play its expected role.
They believe that there is no way as country we can achieve reasonable growth in economy without a strong insurance industry.
Herbert Wigwe, GMD, Access Bank plc joined by other experts in a recent forum organised by Access Bank to deepen insurance penetration in Nigeria said “economic growth can be faster if the nation’s insurance industry is properly positioned to play its critical role of mobilising long term funds for development”
Wigwe said insurance industry in Nigeria has been for a very long time, so has the necessary capacity to support national development particularly in mobilising long term funds that other sector can leverage on for growth.
He also said there is huge potential for insurance growth, stating that there is better awareness today on how to manage risks as a lot of people are looking for quality products to plan their future.
“I believe there is need for consolidation or recapitalisations in the industry boost the capacities of individual companies, to enable them explore opportunities in the economy for growth”.
Elias Igbinakenzua, ED, Corporate and Investment Banking, Access Bank speaking at the forum said the insurance industry must have the right vision to where it wants to go.
Igbinakenzua observed that insurance and banking can actually work together to create the needed products and platforms to deepen penetration.
“We believe that if the insurance industry takes today’s opportunities by finding the right partnerships that will enable it leverage on growth Nigeria can lead the pack in Africa and set the pace in the industry”
“A partnership with the banks can create a big jump for the insurance sector”
Igbinakenzua also advised the insurance industry embark on aggressive retail drive, increase awareness campaign and go into advocacy to make its voice heard when national policies are being made.
Sunday Thomas, director general, Nigerian Insurers Association (NIA) speaking on the theme “Harnessing Economic Realities with Opportunities for Growth in the Insurance Industry said the insurance industry in Nigeria presents a lot of growth opportunities due to the low insurance penetration.
Thomas said the industry is expected to achieve a premium volume of N6trillion and total market asset base of N16trillion, by year 2020.
We are hoping that the insurance industry will increase penetration (contribution to GDP) to 15 percent; achieve a density (premium per capital) of $ 256; reduce insurance gap from 94 percent to less than 30 percent, Thomas said.
To achieve sustainable growth, he said the market must continue to enhance the way it is valued by the consumers and other stakeholders.
“The industry must step up its consumer education and public awareness of the vital importance of insurance as a social and economic transformation mechanism; keep developing innovative solutions required by consumers to manage risks in an increasingly complex and uncertain environment.”
He also stated that price based competition cannot drive growth and sustain the market and therefore must change.
Besides, he observed that high level deployment of technology will ensure efficiency needed for sustainable growth , and that the availability of key talents is crucial to the survival and success of the insurance industry.
According to Thomas, as operators, will need to place customers at the centre of our business plans and strategies; review our products, policies and processes to ensure that they are relevant to customers’ needs.
“We must begin to build capacity in retail businesses and we deliver on the promises through simplified claims processes that will leverage on the use of cutting edge technology, Thomas advised.
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