All Posts in "Month: November 2022"

NIA Chairman, Olusegun Omosehin reels out 4-pronged agenda for industry

By Favour Nnabugwu

 

 

 

The 25th Chairman of the Nigerian Insurers Association (NIA), Mr Olusegun Ayo Omosehin has declare a four pronged agenda for the industry with the theme: Expanding the frontiers of Insurance through Partnerships and Stakeholders’ Engagement.

Omoshein, at his investiture ceremony in Lagos yesterday said he will focus on four (4) key strategic areas:Market Discipline, Market Development & Respect for Market Agreements

We shall ensure adherence to high ethical standards for our market which has been the pillars upon which the association was formed.

“Specifically, the NIA under my chairmanship will work with other stakeholders to: Ensure enforcement of all compulsory insurances through effective collaboration with relevant agencies Implement progressive market development initiatives and agreements Explore new areas of business collaboration to expand the market Collaborate with the regulatory community particularly our primary regulator,”

The new chairman said “we will collaborate with all players to enforce market discipline among member companies. As a Self-Regulatory Organization (SRO), the Association works through the peer pressure to promote best practice among operators.

“We will work very hard as leaders of the Association to build trust and lead by example, so that some of the issues relating to soft market practices and general indiscipline in the market are promptly dealt with.

“We shall ensure adherence to high ethical standards for our market which has been the pillars upon which the association was formed.”

He explained that NIA under his leadership will work with other stakeholders to:ensure enforcement of all compulsory insurances through effective collaboration with relevant agencies, implement progressive market development initiatives and agreements, explore new areas of business collaboration to expand the market and collaborate with the regulatory community particularly our primary regulator, NAICOM, on market impacting regulations such as Risk-Based Supervision, among others.

He said the he will upgrade the digital capabilities of the NIA Secretariat to meet and respond to the growing demands of our public, adding that these should culminate in product and process innovation that meets our customers’ multi-dimensional needs.

“We must bear in mind that the world has evolved and so has our country. The ways and means of our economy, business environment, social fabric, norms, and communication. Whilst this provides massive opportunities for us, it also means that risk profiles have evolved. If we are to serve it adequately, we must evolve along – in our thinking, in our approach and in our intent.”

He however called for the maximum support and cooperation of other key industry stakeholders including the industry regulator, the National Insurance Commission (NAICOM), the Nigeria Council of Registered Insurance Brokers (NCRIB); institute of Nigeria (CIIN), Association of Registered Insurance Agents of Nigeria (ARIAN), and others, in achieving our goal of a prosperous insurance industry.

He assured that his administration will work closely with NAICOM in all areas, particularly in unpacking solutions that works for a developing market like Nigeria and in ensuring compliance with all extant regulations that will promote the growth and development of our industry.

He promised to work closely with other stakeholders including the government to maximize the benefits derivable from the provisions of the Insurance Act 2003 and other related legislations. “We invite other trade groups to join hands with the NIA for us to have a coordinated approach to resolving issues.”

“We shall encourage members to deploy innovation to increase acceptability, accessibility, availability, adequacy and affordability of insurance products and services. Because only then can we fulfil our promise of protecting the lives and dreams of our customers.”

Patoma Admin by — November 4, 2022 in Insurance 0
NIA new Chairman, Olusegun Omosehin’s tenure theme: Expanding the frontiers of Insurance through Partnerships, Stakeholders’ Engagement

INAUGURAL SPEECH BY THE CHAIRMAN OF THE NIGERIAN INSURERS’ ASSOCIATION (NIA) – MR. OLUSEGUN OMOSEHIN AT THE INVESTITURE CEREMONY IN HIS HONOUR ON THURSDAY 3RD OF NOVEMBER 2022, AT THE GRAND BALL ROOM, LAGOS ORIENTAL HOTEL, VICTORIA ISLAND, LAGOS

Protocols,

 

Distinguished ladies and gentlemen, I am very happy to see you all seated here today despite your very busy schedules.

It is indeed a great honour and further confirmation of your love for me, the insurance industry, and our dear Association for which I will remain ever grateful.First, let me take this opportunity to appreciate my colleagues in the Governing Council and all CEOs of member companies for the confidence reposed in me as expressed in my election as the 25th Chairman of our noble Association. It is a rare privilege and a great honour to lead the Association particularly at this time in our history as a nation, and I do not take it for granted.

The Nigerian Insurers Association has come a long way and the modest achievements recorded over the past five decades have been made possible by the solid foundation laid by our founding fathers which has been sustained by successive leadership of the Association as well as the unflinching support and commitment of member-companies. Currently the country is caught between the impact of a myriad of global issues ranging from supply chain disruptions, post-covid adjustments, talent and work-place evolution, and climate change; to local issues such as socio-political and economic downturn, escalating security challenges, inflationary pressures, volatile foreign exchange rates, and impact of catastrophic events (a good example is the current wave of floods across some parts of the country) amongst others.

The outcome of all these is escalating risks: risk to our individual lives, businesses, and our future as an industry. Closely following that is the state of geo-political rivalries across the globe – Russia/ Ukraine war and its far-reaching implication on the global supply chain, energy prices, as well as people thousands of miles away; and socio-political issues – the case of the Headscarf death in Iran.On the economic front, inflation is a global situation currently plaguing both developed and developing countries, the US has seen two consecutive quarters of economic contraction and the volatility facing most countries due to the strengthening of US dollar and other factors remain troubling.

However, in the midst all these are new opportunities, both globally and locally, open to us in infrastructure, healthcare, technology, agriculture, mining, power, education, and human capital management all with the potential to disrupt the trajectory of our lives and businesses forever. We should therefore take advantage of these opportunities, which has never been available at this scale and magnitude in decades, to redefine and reposition ourselves as a partner for the prosperity of our country. A few weeks ago, during my acceptance speech at the Annual General Meeting in August where I was elected Chairman, I stated that as an industry, we have an opportunity to re-appraise the state of our industry and chart a new course for it.

Moving intently from our brand image towards our brand identity. To strengthen it and to position ourselves to contribute more impactfully towards the cultural and socio-economic development of our nation. As Insurers, together with our other counterparts in the financial services sector, we must be the catalyst that serve as the guard-rails protecting the delivery of the future of Nigeria by supporting the innovative process in this new and changing world to deliver our prosperity. We have the tools.

The dreams of innovators, of parents for their children, of aspiring businessmen seeking to change their world around them cannot continue to be truncated permanently by forces both known and/or unknown. Our role remains clearly defined and yet to be fully occupied. By embracing the new and emerging world and the associated challenges, steer the ship of growth and innovation quickly to provide the buffer required for the economy to thrive, not impeding it by clinging on to the past.

Please remember that the change we seek must start with us as an industry. Resolving the current challenges will require thinking different and extraneous to what created these current challenges in the first place. Our ability to self-regulate and be bold and courageous in enforcing our market conducts is vital if we must take our rightful place amongst the pillars of economic growth and development in Nigeria. We must understand the importance of protecting our collective dreams and aspirations and positioning ourselves appropriately to earn the trust of our nation. A lot of work has been done in this regard by successive leadership of the Association leading to national recognition for our industry, but much more is still required to be done.

This will be trust earned through our demonstration of capacity, competence, integrity, and conscientiousness. In the light of the foregoing, I have chosen the theme of my tenure as: Expanding the frontiers of Insurance through Partnerships and Stakeholders’ Engagement.Under this broad theme, we shall focus on the following four (4) key strategic areas:Market Discipline, Market Development & Respect for Market AgreementsDuring my tenure, we will collaborate with all players to enforce market discipline among member companies.

As a Self-Regulatory Organization (SRO), the Association works through the peer pressure to promote best practice among operators. We will work very hard as leaders of the Association to build trust and lead by example, so that some of the issues relating to soft market practices and general indiscipline in the market are promptly dealt with. We shall ensure adherence to high ethical standards for our market which has been the pillars upon which the association was formed.

Specifically, the NIA under my chairmanship will work with other stakeholders to:Ensure enforcement of all compulsory insurances through effective collaboration with relevant agencies Implement progressive market development initiatives and agreements Explore new areas of business collaboration to expand the market Collaborate with the regulatory community particularly our primary regulator, NAICOM, on market impacting regulations such as Risk-Based Supervision, among others Insurance Awareness & Partnership with the Media. There is no doubt that we are convinced that insurance awareness level is still very low among the populace. I will work with all stakeholders to increase the awareness campaigns so that we can have more people in the insurance net. To this end, we will actively pursue the insurance awareness and publicity project under the auspices of the Insurers’ Committee.

We invite all stakeholders in the insurance industry to join us in this journey as we seek to entrench insurance culture and expand the dragnet in line with the central theme.We shall be deliberate in forging a stronger partnership with the Media to significantly improve the image of the insurance industry in Nigeria and ultimately increase insurance awareness.Human Capacity Building In other to serve the market better and respond to the dynamics of a changing world, we will explore training opportunities to build capacity in critical areas of insurance business. We need to invest in human capital across the industry, embrace talent that would be beneficial to our core objective. We need to grow our talent pool from within and embrace openness in our industry. We shall partner in building actuarial capacity for the overall benefit of the market

.Today, we are faced with security challenges such as kidnapping, banditry and outright terrorism. We are also contending with the after-effects of climate change such as flooding and related risks. We will take learnings from other markets that have the requisite experience in these areas of insurance business to improve our underwriting practices in these critical areas. Leverage Technology, Digital & InnovationThe time has come for the industry to be deliberate in our investment in technology and innovation.

Specifically, we shallSeek to leverage all the advantages that technology would provide in our quest to improve accessibility, affordability, adequacy, awareness and the availability of the right insurance products and services to the right customer. Embrace openness and willingness to collaborate with intra and extra-industry stakeholders (including Fintechs, Insuretechs, etc.) to drive customer centric models for penetrating the market. Upgrade the digital capabilities of the NIA Secretariat to meet and respond to the growing demands of our publicAll these should culminate in Product and Process Innovation that meets our customers’ multi-dimensional needs. We must bear in mind that the world has evolved and so has our country. The ways and means of our economy, business environment, social fabric, norms, and communication. Whilst this provides massive opportunities for us, it also means that risk profiles have evolved. If we are to serve it adequately, we must evolve along – in our thinking, in our approach and in our intent.

I want to acknowledge that we will need the maximum support and cooperation of other key industry stakeholders including the industry regulator, the National Insurance Commission (NAICOM), the Nigeria Council of Registered Insurance Brokers (NCRIB); the Institute of Loss Adjusters of Nigeria (ILAN), the Chartered Insurance Institute of Nigeria (CIIN), Association of Registered Insurance Agents of Nigeria (ARIAN), and others, in achieving our goal of a prosperous insurance industry.Let me assure our regulator, NAICOM, that we shall work closely with them in all areas, particularly in unpacking solutions that works for a developing market like Nigeria and in ensuring compliance with all extant regulations that will promote the growth and development of our industry. I promise to work closely with other stakeholders including the government to maximize the benefits derivable from the provisions of the Insurance Act 2003 and other related legislations. We invite other trade groups to join hands with the NIA for us to have a coordinated approach to resolving issues. We shall encourage members to deploy innovation to increase acceptability, accessibility, availability, adequacy and affordability of insurance products and services. Because only then can we fulfil our promise of protecting the lives and dreams of our customers.

Once again, I wish to recognise the efforts of all the past chairmen for their commitment to the ideals of our Association. In this regard, let me acknowledge the excellent work done by my predecessor, Mr Ganiyu Musa, particularly for delivering a modern and befitting Secretariat building which is a pride to the entire insurance industry. I assure you that the flag shall continue to fly higher under the new administration. My tenure would build on your achievements and focus more on areas requiring improvements.Let me also use this opportunity to appreciate and recognize our partners in the media for their support and commitment to the Association and the insurance industry at large.

I am proposing a more engaging partnership which we must agree all the elements in the coming days.It is therefore with a deep sense of responsibility, humility, and total commitment to the ideals of our association that I accept to serve together with my colleagues in the Governing Council. I am truly humbled by this opportunity to contribute my quota in the service of the Association. Let me at this juncture specially appreciate the support and encouragement received from Old Mutual Group thus far. The journey will be long and demanding but I am confident of the success and celebration that will follow. I want to also acknowledge the massive support from my wife, children and entire family. I will continue to ask for more.

To my friends, colleagues and fellow golfers, you are highly appreciated.I cannot end this speech without thanking the Investiture Planning Committee led by my good friend and brother, Mr. Kunle Ahmed. Other members include Mrs. Bola Odukale, my able deputy, Mrs. Folashade Joseph, Messrs. Babatunde Fajemirokun, Austin Ebose, Edeki Isujeh, Bode Opadokun, Ademola Abidogun, Dr. Adaobi Nwakuche and Mrs. Mary Adeyanju. I also acknowledge the support of the Director General of NIA and the Secretariat staff. I will not fail to acknowledge the support of my colleagues – Alero Ladipo and Rachel Owolabi who served selflessly in the Investiture Committee. Thank you all for organizing this highly successful investiture ceremony within the limited time available. As we embark on this journey,

I ask for your support, encouragement, and prayers. Together we shall take the insurance industry to greater heights!Thank you all and God ble

Patoma Admin by — November 4, 2022 in Insurance 0
Naicom tasks new NIA Chairman on industry claims settlement, improve communication btwn sector, regulator

CAPTION:
L- Commissioner For Insurance, Mr Sunday Olirundare Thomas and the new chairman of the Nigerian Insurers Association, NIA, Mr. Olusegun Ayo Omosehin
By Favour Nnabugwu
 
The Chief Executive Officer of the National Insurance Commission, Naicom and the Commissioner for Insurance, Mr Sunday Olurundare Thomas has challenged the 25th Chairman of the Nigerian Insurers Association, NIA, Mr. Olusegun Omosehin to take industry of settlement of claim
Thomas who at the ok investiture ceremony of Omosehin tasked him among other issues of non-settlement of claims de-market the sector
“I want to also challenge the new leadership on the vexed issues of settlement of claims. I urge the new leadership to deploy the principle of self regulation to take a critical look into this and other similar issues 
that are capable of de-marketing the industry”
Inability or actions of some operators’ refusal to settle claims for whatever reasons, the commission said, is unacceptable, “This is unacceptable and it is high time we changed the narrative collectively as an industry”
 Naicom thanked the past, new chairman of NIA and the entire industry operators for their unflinching support to him and Naicom but he said he wished that the communication behind the Commission and operators will improve further more.
“I want to equally advise the new leadership to at all times ensure proper communication in engaging the Commission through whatever bilateral windows available”
“We must all see this business as an interest that we must all protect and I again challenge the new leadership of the NIA to take on this task”
I challenge the new leadership to cooperate with the Commission in ensuring compliance and development of IT infrastructure for the operators.
“To  actualize our core mandate as an industry, we must facilitate improved perception of the insurance industry, as public confidence in our industry depends among other things on how promptly and fairly we deliver on our promises and obligations to our customers and stakeholders”
He spoke on NAICOM Portal which was officially commissioned by the Minister of Finance, Budget and National Planning Mrs. Dr. Zainab Shamsuna Ahmed few months ago and it is up and running by added to that a number of circulars and directives have been issued by the Commission on compliance with the requirements and update of information needed from operators.
.
He pointed out his target to increase the market development of insurance had not change even the promotion of the compulsory insurances which affirmed has gained a lot of improvement
“Greater efforts have been made to partner state governments on enforcement of compulsory insurances and insurances of their assets. The Commission had embarked on this drive to till the ground while  expecting the operators to take over and engage the markets but the response from the industry is less than satisfactory”
On the investiture of Mr. Olusegun Omosehin as the 25th Chairman of the
Association, he said, is yet another occasion for celebration in the history of the Nigerian Insurers Association (NIA),
“The unprecedented strides in the various components of our beloved industry are evidence of the enormous hard work of the great men and  women of different calibre and pedigree manning the different arms of 
the insurance industry”
Without mincing words, the Commissioner for Insurance commended the leadership style of the outgoing Chairman of the NIA Mr. Ganiyu Musa for his amiable leadership and stability of the operations of the Association, his resilience, commitment, and strong passion for the development of the insurance industry.
Mentioning some of Musa’s feats, he added, “We must also not forget his active role in ensuring the completion and eventual commissioning of the new Head Office of the NIA during his tenure.agenda-setting by challenging him and his team with some areas of thought.
Thomas said that operators are not unmindful of the challenges operators in the industry have had to contend with in adapting to drastic changes that are designed to accelerate development and growth of insurance business.
“The current dynamic socio-political and economic environment in the country obviously calls for realignment by all stakeholders to tackle these inherent challenges. There is the need for a firm handshake with all arms to engender fruitful collaborations and cooperation for the collective interest of all”.
The Commission, he assured,  will continue to support the insurance industry and specifically the operators/players to thrive by instituting policies that encourage equal access, investment of funds and healthy competition.
Patoma Admin by — November 3, 2022 in Insurance 0
Faces at NAIPCO ‘s 7th Conference in Lagos

By Favour Nnabugwu

 

The Nigerian Association of Insurance and Pension Editors, NAIPE held its 7th Annual Conference in Lagos. Faces at the event held at Oriental Hotel. Lagos

CAPTIONS:

L- Chairman, Nigerian Insurers Association, NIA, Mr. Olusegun Omosehin and the President of the Chartered Insurance Institute of Nigeria, CIIN, Mr. Edwin Igbiti at the National Association of Insurance and Pension Correspondents, NAIPCO 7th annual conference in Lagos

Mr. Director- General of the College of Insurance and Financial Management, Mrs Abimbola Tiamiyu; President of the Chartered Insurance Institute of Nigeria, CIIN, Mr. Edwin Igbiti; Olabisi Adekola of African Alliance and Funmi Omo of MD, Enterprise Life Insurance at the event.

R- President of the Chartered Insurance Institute of Nigeria, CIIN, Mr. Edwin Igbiti, Mr Cyril Ajagu,  Chairman of Africa Alliance, Nkechi Naeche-Esesebor, chairman of Nigerian Association of insurance and Pension Editors, NAIPE, Deputy Director, Communication & Market Development, Mr. AbdulRasaaq Salami and MD of Enterprise Life, Mrs Funmi Omo at the conference

L- Deputy Director, Communication & Market Development, Mr. AbdulRasaaq Salami present plague to the Director General/Chief Executive Officer, Lagos Chamber of Commerce and Industry (LCCI), Dr. Chinyere Almona

L- Director General/Chief Executive Officer, Lagos Chamber of Commerce and Industry (LCCI), Dr. Chinyere Almona, President of the Chartered Insurance Institute of Nigeria, CIIN, Mr. Edwin Igbiti presenting plague to Mr Cyril Ajagu, Chairman of Africa Allianc at the event

R- Managing Director of Royal Exchange General Insurance, Mr Benjamin Agili and Dr. Tunde Alayande of National Pension Commission

R- Director-General of the Nigerian Insurers Association, NIA, Mr. Yetunde Ilori and Funmi Omo of MD, Enterprise Life Insurance

Dr Ben Ujoatuonu of Universal Insurance, Mr Cyril Ajagu, Chairman of Africa Alliance and Mr Sylva Ogwemoh of Africa Alliance

L- Damilola Ayinde of ARM Pension, Mr Kunle Odewunmi, president of the Association of Registered Insurance Agents of Nigeria, ARIAN and Jeremiah Okpako of ARIAN

 

Patoma Admin by — November 3, 2022 in Insurance 0
Coronation Insurance’s total assets hits @ N39.80 bn as GWP records N14.13 bn in 2021

CAPTION:
L- Managing Director/CEO, Coronation Insurance,Olamide Olajolo; Chairman Board of Directors, Mutiu Sunmonu and Company Secretary Mary Agha at the Annual general Meeting today
By Favour Nnabugwu
Coronation Insurance’s total assets stood at N39.80 billion as the the financial year ended December 31, 3021 with a Gross Premium Written (GPW) of 
N14.13 billion in the same year, 2021,
The company’s Chairman, Mr. Mutiu Sunmonu, said at the firm’s Annual General Meeting (AGM) of the company in Lagos,
Sunmonu informed the shareholders of the strides the firm has made and would continue to make in the deployment of technology, which is now the major driver of business growth.
Coronation Insurance’s Chairman said  that a share capital of N11.99 bn; share premium of N4.61 bn; contingency reserves, N3.66 bn; other reserves, N1.75 bn and total equity, N21.59 bn were recorded in the year.
He stated that the firm’s net underwriting income was N9.66 bn whilst he added that N7.31 bn was paid as claims.
Sunmonu informed that the firm also recorded a total underwriting profit of N1.25 bn, while the investment income stood at N1.51 bn.
Also speaking, the Managing Director, Mr. Olamide Olajolo, said although there was a decline in the company’s GWP and GPI when compared against the prior year figures, the company fared better in the year under review as the difference between the GWP and GPI for the 2020 financial year is more than the difference in the figures for the 2021 financial year.
Olajolo submitted that the decline was attributed to the company’s decision to not underwrite some high-risk accounts which required huge reinsurance expenses and have high loss ratios.
He assured the shareholders that the company has since secured more profitable accounts to improve its financial performance.
“As part of the efforts to increase the GWP and GPI, the Company has identified and commenced strategic partnerships such as the bancassurance partnership with Access Bank Plc which accounts for 27 per cent of the GWP for the 2021 Financial Year,” he posited.
He affirmed that the decline in the fees and commissions earned in the year under review was a consequence of the firm’s decision not to underwrite the earlier referenced high-risk accounts.
He said the company has increased its collaboration on more profitable accounts in order to increase its fees and commissions.
On reinsurance and claims expenses, he said the firm in 2021, was presented with a lot of #EndSars claims which were within its retention limit and contractually bound to pay.
“Consequently, the company had to review its Outstanding Claims Reserves (OCR) by almost a billion. We however want to assure our Shareholders that steps have been taken to protect the company from further losses of this magnitude.
“The retention limits on various classes of policies have been reviewed. Also, we have developed further capacity within our reinsurance team to better improve on our reinsurance arrangements. These efforts have yielded positive results so far,” he submitted.
He noted that in spite the outcome of the financial result in the year under review, the shareholders should be assured that the board and management are making concerted efforts to diversify the firm’s income.
The MD emphatically noted that aside the bancassurance partnership, the company had developed five poducts, three of which have been approved by the National Insurance Commission (NAICOM).
“We are committed to increasing the company’s market share and overall profitability by capitalising on various digital platforms to drive sales of our products as well as embarking on profitable investments,” he assured.
He said the increase in management expenses for the year under review was as a result of the costs incurred to ensure that the company provides a safe working environment following the COVID-19 pandemic, adding that although, inflation had really affected the company’s costs, the company has adopted a lot of cost rationalisation initiates from which it expects to see appreciable savings.
“We are committed to increasing the Company’s market share and overall profitability by capitalizing on various digital platforms to drive sales of our products as well as embarking on profitable investments. Expenses: The increase in Management Expenses for the year under review is as a result of the costs incurred to ensure that the Company provides a safe working environment following the Covid-19 pandemic.”
He said that the firm strives to ensure gender balance across every cadre. “We assure our Shareholders that we are doing our best to ensure gender balance at the top management level,” he added.
He touched regulatory environment for which he said NAICOM has been supportive in the industry’s drive to deepen insurance penetration by providing the platform for web aggregators and micro insurers, stressing that NAICOM has also encouraged the use of digital platforms for the sale of insurance.
He maintained that the company has taken advantage of this by entering strategic partnerships with various web aggregators and developing in-house platforms to ensure a seamless customer journey.
He stated that to enable shareholders’ have access to information on unclaimed dividends, there is a link on the Company’s website where shareholders can view the list of unclaimed dividends. “We enjoin all our Shareholders to visit the website to confirm the status of their unclaimed dividends.”
“The Company has increased its collaboration on more profitable accounts in order to increase its Fees and Commissions.Reinsurance Expenses, Claims Expenses v. Claims Expenses Recoverable:In 2021”
Patoma Admin by — November 2, 2022 in Insurance 0
Coronation Insurance tasks SMEs to take insurance to mitigate losses

Managing Director of Coronation Insurance, Mr Olamde Olajolo

 

By Favour Nnabugwu

 

 

Coronation Insurance and Coronation Life Assurance Limited have tasked entrepreneurs to take insurance in order to mitigate their business and be able to access loan

The theme: Importance of Insurance for Small and Medium Enterprises (SMEs) focussed on the insurance requirements for growing businesses was held yesterday.

The virtual seminar was widely attended by a host of participants from the insurance sector and Coronation small business clients Gbenga Ismail, Vice President of The Lagos Chamber of Commerce and Industry, set the scene by highlighting the significance of Nigeria’s 40 million SMEs for the growth, development and future security of the Nigerian economy.

In addition to noting that Nigeria had lost 2 million SMEs to the Covid-19 pandemic, Ismail also reported that most new SMEs struggled to achieve scale quickly enough to realise the opportunities for which they were created. Irregular and delayed payments was also critical hurdle.

The result was that most new SMEs failed within 18 months of start-up. Despite 90 percent of SMEs currently not paying tax, SMEs represented a huge potential to drive economic inclusion, broaden prosperity and power the future growth of the Nigerian economy.

As such, Ismail argued that it was critical to provide SMEs with the support to ensure survival in the first critical years. Insurance represented a key financial cushion to manage shocks and build financial resilience in the first years of SME growth. With only 0.5 percent of Nigerian SMEs insured, compare with 54 percent globally, the country should focus squarely on developing an insurance environment more accommodating of and appealing to SMEs.

With this challenge in mind an expert panel, consisting of Adebowale Adesona, Executive Director, Technical, Coronation Life Assurance Ltd., Louis Alozie, Country Manager, Wordplay, and Ayo Olojede, Head of Emerging Business, Africa Access Bank Plc. was expertly moderated by Wole Famurewa, CNBC’s West Africa Markets Editor.

There was no doubt that Nigerian SMEs faced risk. Damage to business property and vehicles, legal liability and general product, key persons and goods-in-transit risks cost SMEs dearly. Just insuring a few of these basic risks could save Nigerian SMEs billions annually and improve survival rates significantly.

Since not all SMEs we exposed to all risks, however, it was important for SMEs to consult insurance professionals to identify only those risks that were critical to the survival of their business. Insuring only one to two key risks didn’t cost a lot but could make a significant contribution to survival and growth rates.

It would also help SMEs to understand the difference between external risks, like flood and fire, and internal risks, usually arising from the people SMEs employed or the systems they used. While technology, for example, was a great leveller for SMEs, helping them compete effectively with the big guys, it also exposed them to cybercrime and other information security risks.

Knowing your customer processes were also important in helping SMEs identify and mitigate client risk. Seeking the right advise on people processes and systems could also help manage fraud or employee risk – often by simply training staff to correctly understand and observe basic internet security protocol. While providing staff basic life or income cover, for example, sounded expensive this was relatively cheap, improved trust and performance and prevented SMEs being saddled with unexpected support obligations in the event of the death or injury of an employee.

Coronation Insurance is working with Access Bank, for example, to develop Business Protection Bundles including basic fire, flood, and limited liability cover as well as limited employee life insurance – providing three years’ annual income – to enable Nigerian SMEs to affordably cover the basics of successfully operating their businesses.

More generally, Nigeria needed to look to the experience of other markets that had developed successful SME insurance ecosystems where government coordinated policy and legislation in tandem with the insurance industry and large and small businesses. While some of this involved compulsory insurance, costs were minimal as it was so widespread.

In addition, embedded insurance, included in the price of products purchased, for example, provided a painless method to spread the use of insurance and address trust deficits. From an SME perspective, the panel concurred that insurance was an investment in yourself.

By spending a little money each month, even a small farmer could mitigate risk, ensuring that he was placed in the position that he or she was in before the fire, gale or flood. Being able to insulate yourself from business-destroying events the routinely wipe out SMEs was a critical first step in Nigeria building a deeper and more effective insurance culture able to support broader and higher levels of economic growth.

Patoma Admin by — November 2, 2022 in Insurance 0
Coronation Insurance tasks SMEs, MSMEs to mitigate losses with insurance, to access loans

By Favour Nnabugwu

 

Coronation Insurance has tasked Scale & Medium Entrepreneurs and the Micro Scales & Medium Entrepreneurs, MSMEs to take insurance in order to mitigate their business and be able to access loan

The Chief Executive Officer of Coronation Insurance Plc, Mr. Gbenga Ismail said insurance is a transformation instrument for all businesses and in the present focus, the Micro Scale Medium Enterprises , MSMEs, to sustain their businesses.

The company during a live Webinar today, said, Entrepreneurs need to use insurance to mitigate their losses and insurance will also help you to access loan”.

With only 0.5 percent of Nigerian SMEs insured, compare with 54 percent globally, the country should focus squarely on developing an insurance environment more accommodating of and appealing to SMEs to accept insurance.

Ismail tasked entrepreneurs to engage the services of insurance brokers who would give them the right advise on which policy and products suitable for them..

Ismail who doubles as vice president, Lagos Chamber of Commerce and Industry, with the the theme of the webinar, “Importance of Insurance for SMEs: Insurance Requirement for a Growing Business,” noted that the past three years had been marked by uncertainties and the uncertainties of the business environment has underlined the importance of insurance protection for business risks at the adequate level to help businesses to grow.

Coronation boss said that transformation would elude this segment of the economy that sustains 96 percent of business activities if insurance protection is avoided.

He reassured that those that would be transformed need insurance to sustain business growth.

He mentioned the vulneraioty oof SMEs and would therefore require adequate insurance more so in an environment where there is very little cushion by government policies for uncertainties.

Therefore without insurance protection businesses are vulnerable. Ismail without a blink informed the participants that business that is well covered is a step ahead of most business.

He used the business information insurance cover that was incepted by the organisers of Wimbledon Tennis in 2003 to buttress the importance of insurance to businesses.

He said the insurance covered the scare of sars and followed it every year, with a premium £1.5 million covering event cancellation. When in 2020 Wimbledon was cancelled, the organisers were paid 114 euros by their insurers for event cancellation.

Patoma Admin by — November 1, 2022 in Insurance 0