The Federal Government on Monday said there was no going back on the insurance industry recapitalisation as it was critical to maximising the sector’s potential to enable it contribute meaningfully to economic growth.
The government said the main reason for the recapitalisation was to strengthen the insurance industry to become competitive, adding that funding was needed to drive the needed penetration, expansion and growth in the industry.
Speaking at the opening ceremony of the 2019 National Insurance Conference taking place in Abuja, President Muhammadu Buhari, who was represented by Mahmud Isa-Dutse, permanent secretary, Federal Ministry of Finance, urged the industry operators to cooperate with the regulator and bring the needed growth in the industry.
He also emphasised the need for professionalism in the industry as another important element to achieving consumer trust for growth.
The conference has the theme ‘Distribution, Innovation and Business Growth’.
Mohammed Kari, commissioner for insurance/CEO, National Insurance Commission (NAICOM), said in his welcome speech that the conference provided a veritable platform for top government functionaries, investors, insurance practitioners and other stakeholders to discuss contemporary issues affecting the development of the insurance industry in Nigeria.
He noted that the theme of this year’s conference was pertinent against the backdrop of the need for the Nigerian insurance industry to remain relevant in an era of dynamism where operating in the same way was an assured route to irrelevance.
Eddie Efekoha, chairman, Insurance Industry Consultative Council, organisers of the conference, pleaded with NAICOM to give favourable consideration to the suggestions made by the Nigerian Insurers Association in their ongoing engagements so that the necessary guidelines when released will ensure that the objectives of the reform are fully realised.
He noted that the recapitalisation exercise, like every past reform, presented both opportunities and challenges.
“As operators, we must begin now and not later to address our minds to the following questions: How do we maximise the use of the additional capital to generate superior returns to investors? How does technology help the industry to deliver superior service and deepen insurance penetration? How do we develop a data pool that supports improved pricing of risks underwritten and innovative products driven by consumer insights?” he said.
Efekoha said other questions that needed to be asked included what to do to develop and attract the right skills and talents that can match the fast pace of technology revolution; how to harness the values inherent in partnering with other industries like telecoms and banks to deepen insurance penetration; how to partner with various arms of government like the Nigeria Police Force, Customs and Fire Service to ensure compulsory insurances are enforced, and how to cooperate better than currently for the good of all stakeholders.
Ben Akabueze, former director general, Budget Office, in a goodwill message at the event gave his support to the ongoing consolidation in the insurance industry, saying recapitalisation would make the insurance companies stronger and credible.
He noted that the sector must move away from becoming the small cousin of the banking industry.