Expert outlines key foundation for insurance sector growth

For insurance sector to realize its growth potential there must be efforts to put in place institutional foundation for market development; ensure macroeconomic and political stability, enforce compulsory products as well as adequate regulatory and supervisory framework.
Besides that integrity, trust and firm stand against corruption in line with the present day governments vision must guide activities and operations of the insurance industry.
Shamsudeen Usman, former minister of Finance made the remarks during a presentation.
Usman who is the chairman & CEO Susman & Associates (S&A), speaking on the theme “Overcoming the Current Economic Crisis: The Challenges and Prospects for the Nigerian Insurance Industry” said these are necessary conditions external to the industry needed to realise the potential.
He listed requirements within the industry’s control as adequate regulatory and supervisory frameworks and institutions, strategic reform and realignment, redefining business strategy and operations both for firms and industry as a whole, improved service quality, particularly prompt claims settlement, tapping the retail sector, household insurance bundled with other financial services which recently recorded success in Uganda.
Others he said are, microinsurance of households and small businesses, reshaping products, services, channels, insurance sector consolidation, innovative products targeting Nigeria, Islamic insurance-Takaful, burial insurance and reducing transaction costs and high premiums.
He advised the practitioners and regulators to respond quickly to the changing dynamics of the market space in order to remain relevant and bestow a worthy legacy to the future generation of insurers.
He pointed out that the economic downturn has triggered huge setback to the industry.
Citing countervailing evidence, Usman said: “On the face of it, the sector is not doing badly and is not as badly as rest of the financial sector nor as badly as rest of the economy.
“This finding in line with evidence regarding global financial crisis in 2009 the crisis was primarily a banking crisis solvency of the insurance sector was not threatened.
“Nigeria’s insurance sector is currently rather insignificant in size and influence balance sheet of all the insurance companies is less than a third of that of one of the banks”
CIIN President Isioma Chukwuma explained that the Executive Breakfast Meeting Series have been packaged to periodically update professionals and practitioners alike, on the prevailing global issues pertaining to insurance practice.
According to her, the topic of the meeting comes at a crucial time, especially now that the country is technically in a recession.

“The efforts of the Institute’s Secretariat and the MCPD Committee has paid off as the institute has been able to key into one of the its primary objectives which is to encourage and assist insurance professionals to regularly update their knowledge in order to respond positively to changes in the business environment and meet the challenging needs of their clients.

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