With our foreign partners we will develop products for kidnapping, terrorism- Bailey

The nation’s insurance industry is in the process of witnessing a major effort at developing non-available products to tackle emerging risks in Nigeria that would not only boost industry premium but provide confidence to investors in the economy. Oladipo Bailey, executive vice chairman, Shepherds Insurance Brokers in this interview with MODESTUS ANAESORONYE shares his plan with Afro Asian Insurance Services for the local market. Excerpts:

Shepherds Insurance brokers and Afro Asian Insurance are bringing into the market a synergy, which many have described as unprecedented, what is this partnership looking at achieving?

The programme is about what we have termed “Reinsurance at the Board Level” and is expected that after this training, chief executives of insurance companies should be able to take positive decisions about their business.

The intention is not to teach the rudiments of reinsurance, but we expected that before they rose to the position of chief executives they would have known the rudiments, but there are special areas we need to know which may be alien to us here in Nigeria. And that is the reason we have brought one of the experts in the world, from Allianz in Netherlands to come and pass on that message and knowledge to our people.

Before now has reinsurance decision been a problem for board and management?

It really has been a problem because we at Shepherds and our partners Afro Asian have found out that some of the insurance treaties that our companies have are not really in their best interest. A situation where an insurance company has a treaty and because of the level of deductibles pays all the claims without any recourse from the reinsurance, I don’t think is good enough and I believe something is wrong somewhere.

So we have this as an example and we have others, and that is why Afro Asian Insurance Services of the UK and Lloyds and our self Shepherds Insurance Brokers have come together to make this as our own contribution to the development of the Nigerian Insurance market.

This training is free for our people, to ensure that reinsurance treaties or portfolio are the best for us because without good reinsurance underwriting companies cannot do well. And NAICOM so to say will not allow any insurance company to operate without treaties and that is what we are aiming at, to ensure that companies are properly guided in their decision for treaties.

With this partnership, are you looking at business opportunities?

Well, naturally that would rub on over time. But as far as I am concerned as Dipo Bailey and Afro Asian I can say, we are just geared towards developing the insurance market here. But if we develop the market and people feel we have the capacity to do business with them and they do with us, of course we can’t say no.  But some people may say we a looking for business. Yes of course, but the primary objective for now is to develop the market first before the business starts coming. This is a unique thing in our market because I have been in this market since 1970. Aside my earlier stay in the UK working and studying, it is not common to find organisations like this coming from outside to provide this kind of knowledge and capacity building free of charge.

We do hope that we have more from Afro Asian and Shepherds and others alike will join us so that we get to where we should be. It can be better. Reinsurance is the foundation and if the foundation is not strong, then it becomes a problem.

 Are you looking at developing products for the market?

In fact, coming up with new products for the market is one of the decisions both parties reached during our meeting before the seminar. We agreed that we must go out and identify those risks that are not currently written in the market, possibly available outside and even if it’s not outside we will identify such risks are find market for them abroad. We are looking also at very, very special risks such as ransom and kidnapping, terrorism, political violence risks among others.

Elections are coming and we have situations tagged “Wet Year” and similar things like that we saw in the past. We do pray it does not happen, but insurance is to prepare people against the unexpected so that in the event that it happens people could have some accruable benefits or fall back arrangement.

So we are getting ready for that and we are preparing the insurance companies for that. We are bringing in these policies that were never available in our market and we are going to partner with some insurance companies to develop themselves and take advantage of the opportunities to boost their premium income.