What consumers think about the market…

The perception of the public about insurance has been largely negative. Even when there seems to be improvement in most of the areas of concern, a lot of people still do not believe that insurance industry has improved. Claims generally are paid and even promptly than before by majority of the insurance companies, while non-payment of claims is almost a thing of the past with efforts of the National Insurance Commission (NAICOM) striving hard to protect consumer as its first responsibility.

This is also assisted by the Consumer Complaint Bureau of the NAICOM and Nigerian Insurers’ Association (NIA), which are helping in dispute resolution between insurance consumers and the insurance companies.

But for the consumers, there is still a lot that needs to be addressed to actually win the interest of the larger populace towards taking insurance and achieving the desired level of penetration and density in Nigeria.

Insurance Consumers’ Association of Nigeria (INSCAN), a body established with the objective to protect the general interest of the insurance consumers in Nigeria among other objectives, is pushing for a more excellent service delivery industry.

Yemi Soladoye, national technical adviser, INSCAN, in a presentation on “Expectation from Insurance Operators” demanded for a transparent and reader friendly contract wordings. “Your policy documents, being the evidence of the contact with us is full of discouraging and frustrating technical jargons that hardly would anybody read more than one page of the “hand out” which at times goes up to 30 pages before dropping same.

“Why do you bombard us with words like – whereas, where in, where of, now therefore, knowingly, wilfully, recklessly, negligently, directly and indirectly, proximately and remotely -all making the contract look mysterious and scary to our members.

“We therefore make it categorically clear that we are tired of these intimidating words and expect all insurance companies in Nigeria to adapt their policy documents to the modern trends where the policy document starts with “meaning of words”, followed by “what is covered”, what is not covered and then the conditions guiding the contract with a claim form tucked into the folder at the back of the policy jacket. We expected this from you like yesterday.”

Other demands are:

Truly comprehensive motor insurance cover -The 10 percent premium agreed by the market for comprehensive motor insurance is for about 15 benefits that are enjoyed by the insurance consumers in other parts of the world. Prominent among these are own damage, third party liability, replacement car, loss of personal effect, personal accident cover etc.

In Nigeria we are given 2½ benefits – own damage, third party liability and usually N10,000 towing expenses and N20,000 medical expenses. Our position as consumers of insurance in Nigeria to your members who are under-cutting the rates is that even when your charge 2.5% for the benefits granted us, you are still ripping us off.

Another problem that we have with your comprehensive motor policy is that it is always depressing for our members to realise only at the time of claim that their comprehensive motor policy does not cover losses arising from riot, strike, civil commotion and flood unless they had specifically requested and paid for them before the loss.

We hereby request the governing council of the NIA to give us the full benefits of a truly comprehensive motor insurance policy on “a la carte” basis as from Jan 2014 and in the minimum, benefits like car replacement, vehicle tracker should be automatic as from 2014. Medical benefits should be increased to minimum of N100,000 while the underwriters should bear the cost of towing an accidented vehicle to the repairer’s garage in full.

Truly comprehensive householders insurance

Where an occupied building is destroyed by fire or any of the extraneous perils, the insurer usually provides for loss of rent/ rent of alternative accommodation/ loss of use as the case may be pending the completion of renovation or for specified period of time. Accident and Life cover for domestic servants is also normally endorsed on a comprehensive householder’s insurance cover. We demand that this be provided for us as from 2014.

Minimise claims documentation, investigation process and time.

Stop the practice of requesting for claims documentation piece- meal as a way of buying time. In other countries of the world, insurers have stipulated period on which claim must be paid and at times they conduct their investigation for up to seven years but the claim must be paid promptly.

In Nigeria, our members are made to wait on adjuster’s report which takes ages to come and whom we did not appoint in the first place. The Insurers in Nigeria are protected by Sec. 52 of the NAICOM Act 1997 in case they paid out any fraudulent claim, and hence our members should receive their entitlement at the time they are still in grieve. You should also pay our claims to meet the intended purposes.

For the past third years, we have been looking for instances where burial expenses benefit would be paid for its intended purpose and we have not gotten one. Insurance claims especially on life and accident classes are usually classified into payment, reimbursement or capital sum but we do not have such luxury here. Payment for towing expenses, burial expenses, repatriation expenses all fall within the category of “Payment” and we expect them to be paid for the intended purposes.

Issue discharge voucher with cheque

The discharge voucher usually issued to our members is confirmation of receipt of payment and then we have cases of death for that matter that took up to 18 months after signing the DV.

Henceforth, our members want the payment cheque or evidence of bank transfer at the same time we are made to sign the Discharge Vouchers. In Nigeria today, we are not getting “indemnity” in line with the definition of the underwriters themselves and to make us to sign papers to discharge you of your liability which ends up not discharged up to 3 months after is to say the least unacceptable irrespective of whatever the law says.

Reward the good customers also

Your business is in a way unique, funny and somehow awkward in the sense that it is the careless and unfortunate people who get rewarded by you from the money of the careful and fortunate people. In some other countries, the insurance industries provide entry gift items, mortgage loans, free biannual comprehensive medical test and a host of other benefits to ensure that even those who do not make claims also get something back for their patronage. We demand that you start this in 2014.

Selling ordinary paper as insurance

Housebreaking insurance –Your policy wording here usually insist that the loss or damage must be accompanied by forcible and violent entry or exit from the insured premises. We are all aware of the fact that no burglars engage in housebreaking to enter the premises in Nigeria today.

Goods in transit insurance- It is almost impossible nowadays for our members to make successful claim from their goods in transit policies. Not only that, all that is said is covered in the operative clause is removed in the body of the contract and now you insert a warranty to the effect that the carrier must have its own goods in transit cover. Still your charged full of premium (in advance for the cover). This situation is so rampant that we even get complaints against the underwriters from brokers.

Bonds – Bonds issued to our members suffer the same fate as the goods in transit cover. The wordings are empty and on top of this our members are requested to provide collateral, guarantor, counter – indemnity and personal guarantee all making sure that at the end of the day, the insurer is not carrying any risk. If you are not ready to be our risk-carrier on burglary, goods in transit and bonds, please stop giving us false sense of security.

Modestus Anaesoronye