Experts are looking for stringent regulatory policies that will spur insurance growth

Insurance industry experts have called on the government to create stronger regulatory policies and enforce existing ones to stimulate the industry’s growth.

Despite economic challenges, stakeholders are hopeful that there will be tremendous growth opportunities this year.

Although, according to several industry experts, looking at the sector’s shutdown last year, the issues and discussions that dominated last year are expected to continue.

However, the formulation and implementation of insurance policies, an effective communication system, technology, innovative products and services, as well as strategic partnerships are the most important priorities for stakeholders in 2021.

Managing Director of Law Union & Rock Insurance Plc, Adeduro Ademayowa, said the 2021 budget capital project, estimated at N3.85 trillion, or about 30 percent of the budget, is expected to generate economic activity. He said if all the projects are insured, they would be able to generate about N50-80 billion for the insurance industry.

Ademayowa said that looking at history, the events that followed the suspension of industry recapitalization were not unusual.

“NAICOM meant well for the industry and therefore the suspension is not a failure. The industry will come together to support the initiative to put insurance on a solid footing,” he said.

According to him, there are few expectations, but most concern operators, not the regulator.

“We need to cooperate more closely to make the industry attractive to young people and investors. Excessive competition makes us lose the essence of business,” he said.

The Executive Secretary of the Nigerian Board of Registered Insurance Brokers (NCRIB), Fatai Adegbenro, has said more businesses and contracts are expected due to capital projects in the budget that will require insurance policies.

“We are optimistic about a better business year. If everything goes according to plan and the new insurance law comes into force, it will be a better year for the industry.

“The regulator is trying to grow the industry and the #EndSARS protest was a blessing for the industry as it brought to light the importance of insurance to the government and Nigerians,” he said.

According to him, the industry is doing a lot to boost the country’s economic development, but little is known about its importance, especially considering the widespread trust deficit in the relationship between the industry and Nigerians.

He added that in solving trust issues, communication is a key ingredient for success.

He said the industry must communicate effectively with the public, including current and potential policyholders.

He said: “What is most surprising is that the industry still seemingly takes communication for granted compared to other financial services providers in the digital age. Effective communication involves the exchange of information and data between parties. Incidentally, policyholders have increased their correspondence to regulators and industry operators, but have not received as many responses. Did you know that Nigeria ranks 8th from bottom among African countries in terms of insurance penetration? This is unacceptable and is a key reason to emphasize communication as a strategic step towards increasing the number of people using insurance.

“New products, collaborations and partnerships needed to increase insurance awareness and deepen penetration could not be given the attention they deserve last year due to the many challenges facing operators. These are areas where we expect more positive action from operators in 2021.”