The Chairman of Heirs Holdings and the Founder of the Tony Elumelu Foundation (TEF), Mr. Tony Elumelu has stressed the need for operators in the insurance sector to embrace innovation and technology in their operations so as to increase the market penetration and acceptability of insurance in Nigeria.
He made the call on Thursday at the Nigerian Council of Registered Insurance Brokers (NCRIB) 60th anniversary in Lagos, with the theme: ‘60 Years of Insurance Broking: Redefining the Practice and the Practitioners.’
He also said appropriate sanctions should be given for unethical practices in the sector so as to encourage more Nigerians to adopt insurance.
Speaking further, he said the Know Your Customer (KYC) process that had been adopted in the banking sector could be applied in the insurance sector in order to accelerate the adoption of insurance. He said: “To remain relevant in the modern business arena, the insurance broker community and by extension, the entire Nigerian insurance industry must embrace technology fully.
“The body (NCRIB) also needs to work towards positioning its members properly for digital integration, mediating between the insuring public and underwriters digitally to embrace technology and digital adoption because the current analogue processes need to be eliminated to improve service delivery to our customers.“The brokers industry cannot advance when the other financial services are transitioning to online real-time and we are still stuck with a system that relies on hard copy files and documents. The brokerage sector needs to drive clean data for the industry.”
Commenting on areas to improve the sector, he reiterated that unethical practices should not be encouraged.He said: “An insurance broker must be professional at all times. In redefining the practice and practitioners in the brokerage profession, NCRIB should lead the war against many of the unethical practices that have been the bane of the industry for years.
“These include premium rate cutting, delayed premium remittance, unremitted premium, overloading of premium, returned premium, fake documents, fraudulent claims, collusion to defraud, mis-selling, unhealthy competition, misrepresentations, manipulation of policy conditions, self-enrichment methods disguised as marketing expenses, and many more.“While NAICOM continues to play its role as the industry regulator, NCRIB as a body must ensure that appropriate sanctions are imposed on any of its members found using unethical practices.”
He added: “Let us talk about the need for innovation, the power and imperative need of technology in the 21st century, let’s talk about how we should raise awareness of insurance in a country of 200 million people with poor penetration and as a percentage of GDP tiny.“We need to promote and raise this awareness in our sector and how do we pursue the objective of creating a far and deeper highly capitalised industry that serves the customers and channels long-term investment to our economy to drive and catalyse other economic activities for growth?“How do we expand the sector by superior customer experience that helps customers or clients to improve their level of confidence in the sector thereby improving their insurance adoption?
Speaking on the need for collaboration for seamless KYC adaptation, Elumelu said: “We have the banking sector that is being regulated and they do their KYC on customers with BVN and so many things and then the insurance sector also goes through that same KYC.“Why don’t we collaborate in a way that once a client who is a customer of a bank and can be verified, then we take it that the KYC has been done and then we leapfrog that immediately to serve the customer?
That is a collaborative action we would need to put in place to change our sector.” According to Elumelu, the insurance sector plays a pivotal role in any society and provides much-needed safety and security.“With insurance, families receive financial security, assets are protected against hazards, and businesses continue to run with the assurance of financial compensation in the event of a loss.
“In a nutshell, insurance keeps families and their possessions intact, provides financial safeguards for businesses, creates employment, and generally advances the economy.
“An economy is therefore as advanced as its insurance sector. We need to ask ourselves if we are doing enough because our industry’s contribution to national GDP is tiny, our reputation could be better, our practices more professional, and our promises to our customers are always honored.
“Indeed, a well-regulated industry is a benefit not just for the beneficiary broker but the trusted and necessary confidence of the customers,” he added.
Elumelu also urged operators in industry to always benchmark their activities against global trends and strengthen their hold on retail insurance.
He further said: “The insurance industry can benefit from innovation across all phases of the service. For this to happen, there is the need to reward and incentivise innovation across the industry.
“In a country of 200 million people and income per capita of over $1000 we can and should and must be more relevant than we are today. We can create this sector to contribute more than 15 to 20 per cent of our GDP and I believe that all of us should commit to doing so.”
