• Sunday, May 19, 2024
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Breaking barriers in energy insurance

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Ikechukwu Eze

For decades Global Assurance operated typically like any other insurance outfit in an environment where the business of underwriting was largely punching below its weight. But in 2003 some quick-witted investors out to make a difference acquired, rebranded and changed the focus of the good old outfit in a manner that brought a refreshing dynamism to the industry. Fired by a cheery spirit that breaks barriers and dislocates limitations, the new owners sought refuge in energy insurance, a hitherto slippery terrain that was off limits for local insurers because of the weighty budget involved in underwriting oil and gas business.
The result of the foray is what is known today as International Energy Insurance Company Plc (IEI); a foremost underwriting outfit which birth lent some vigour and momentum to the industry, especially in the areas of aggressive marketing and innovation.
There is no doubt that IEI’s grip on the job derives from the dreams of its chief executive, Jacob Erhabor, a consummate professional whose integrity is helping to restore public confidence and mould the industry’s burgeoning buoyancy.

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Erhabor feels that by venturing into energy insurance at a time the genre was dominated by foreign conglomerates, his company was interpreting the mood of the industry, especially in the wake of a consolidation regime that boosted the capacity of underwriting firms.
Investors who took new positions in the insurance market are those who understand and appreciate the new role of the industry in the nation’s economy, Erhabor said in a recent interview, stressing that the insurance industry in the country was going through a silent revolution.
Erhabor who is IEI’s first Managing Director and Chief Executive is said to have moulded the company’s virile corporate culture and values in the bid to create an insurance brand of exceptional value as a means of leading the industry in integrity and premium innovative service.
With an established edge in oil and gas insurance, Erhabor said IEI is well positioned to take full advantage of the local content policy which requires Nigerian and multinational oil and gas operators to earmark at least 45 per cent of their insurable assets and risks to the local insurance market.

Although IEI has gained core competence and carved a niche for itself in energy insurance, it is known to also have comparative expertise in all other aspects of businesses insurance with a broad range of subsidiaries and associates in related businesses.
Industry watchers agree that IEI has recorded phenomenal growth within a short period and gained the confidence of the market as a result of its aggressive approach to business development and knack for innovation.
One of such areas where the outfit has established a sound footing is in investment in IT infrastructure which has enabled its online product distribution as a platform for delivering better service. With this, the client is saved the stress of visiting the company for policy by just filling the form online, paying online, and accessing the policy online using an e- payment platform.
With shareholders’ funds in excess of N11.5 billion in an industry where the regulatory minimum requirements is N3 billion for general insurance business, IEI’s capital base sure puts it in good standing in the industry.
Last year IEI got tripple B ranking from Agusto & Co for its performance. The rating agency had in its 2008 Insurance Rating Report categorised the firm as an insurer with satisfactory financial condition and adequate capacity to meet claim obligations.
In the performance ratios Agusto stated that IEI possessed a solvency margin of 469 per cent compared to a regulatory minimum of 15 per cent, which meant that IEI has 31 times more cash than the industry average.
Also last year the company bagged the prestigious African Insurance Company Award at a ceremony in Ghana. Ken Kiami, Managing Editor of African Leadership magazine, organisers of the award said it was in recognition of IEI’s leadership role in energy insurance in the Nigerian and West African markets.
Erhabor who is a fellow of both the Chartered Insurance Institute of Nigeria (FIIN) and the Chartered Insurance Institute of London (FCII) has worked in many insurance companies including African Insurance Brokers, Intercontinental Assurance Company Limited as well as Cornerstone Insurance where he rose to the position of chief executive; a position he held until November 2005 when he joined International Energy Insurance in the same capacity.
There is no doubt that Erhabor and few others in his class have been striving to give insurance a new meaning in the country, especially against the backdrop of
pervasive public apathy. But it is obvious that more still needs to be done as a way of deepening industry penetration among the populace. It is instructive that
Nigeria with a population of about 140 million has a dismal penetration level of about one per cent, ranking it among the lowest in the African market.