Increasing insecurity in the country, climatic change with its attendant flooding that damages properties and other social vices, have resulted in geometric increase in the volume of claims coming the way of insurance operators.
Precisely, in the past ten years, insurance claims climbed astronomically from N28.1 billion in 2007 to N207 billion in 2018.
Against this backdrop, insurance sector operators have raised alarm that the trend, if not checked, would send many operating firms into extinction.
The Deputy Director General, Nigeria Insurers Association (NIA), Mr Lanre Ojuola, said this while speaking at the 2019 insurance consumers interactive session with industry operators.
He said the premium growth rate in the sector, compared to the growth rate of claims, was negative, adding that whereas claims have been growing astronomically, premium growth was marginal.
He said the industry needs speedy growth in the number of policy holders, adding that as at December 2018, the industry only recorded 1.6 million policy holders.
He said this was why operators were anxious to see that more Nigerians embrace insurance through the federal government’s financial inclusion strategy.
He highlighted some of the challenges confronting the industry as lack of public trust, unhealthy competition among the operators, mismanagement, economic instability, dart of man power ,fraudulent activities of customers adding that industry operators are working to overcome the challenges.
In his keynote address at the event, the Acting Commissioner for insurance, Mr Sunday Thomas, said customers’ satisfaction was central to the sustainability and success of every business, insurance inclusive.
He said the commission, was aware of some of the obvious challenges bedeviling the sector either on the side of operators, consumers, investors or regulator.
“From the regulatory perspective, policy holders remain a key component of our primary constituency and therefore must ensure they are treated fairly and protected as enshrined in the relevant laws; while at the same time balancing the supervisory role of ensuring financial soundness and reliability of insurance institutions in the country” he said.
Thomas, who was represented by NAICOM’s Director, Head Office Branch , Adamu Ballanti said: “Suffice it to say that consumers are faced with challenges that may vary from one individual or entity’s experience to another while the provider is faced with constraints that may also differ from one company to the other. “But there is no doubt regular interactions such as this one will amongst others foster a better understanding and synergy that will result to better services to the consumer.”
On the mandate of the commission to protect policy holders, Balanti said: “It is imperative to note that NAICOM is well positioned to ensure adequate protection of policyholders at all times.
“As you may all be aware, the topic on consumer protection has become central to regulators around the globe and the insurance sector is not an exception. Continuing efforts and new reforms are being put in place by NAICOM to ensure prompt payment of genuine claims by insurers.”