The Covid-19 outbreak and its attendant impact on businesses and the economy are taking huge toll on the insurance business.
In the midst of low sales as result of less face-to-face contact with customers, and the gradual adoption of technology as a sales tool, insurers are being faced with health, travel and business interruption claims.
In most advanced markets business interruption is a big deal, particularly now that organisations had to shut down for the Corona virus lockdown for weeks and months, meaning that insurers that provided cover for these loss positions will have huge claims on their hand.
Experts who shared their views recently at an interactive and cross-border webinar organized by the National Insurance commission (NAICOM) in collaboration with the Financial Institutions Training Centre (FITC) observed that in the midst of the challenges, there are hidden opportunities.
According to them, the importance of innovation and technology in diving insurance sales and distribution cannot be overemphasized at this time, as this has become critical in growth sustenance post covid-19 era.
Ganiyu Musa, group managing director/CEO, Cornerstone Insurance Plc who was the lead speaker during the interactive session provided detailed background on the impact of the global pandemic to the Nigerian economy which is faced with two shocks – the global pandemic and oil price crash.
Musa also highlighted some of the key impacts of the pandemic on global insurance – recession and financial crisis, supply chain, sales, operations, travel and regulation.
He also submitted that the implications for the Nigerian Insurance industry will cut across revenue, claims costs, liquidity, investment return, underwriters, brokers, regulators and customers.
He however highlighted the emerging opportunities to include technology and innovation, opportunity in life and health, increased government investment in the health sector and creative products for a logistics firm, Internet service providers among others.
Experts at FITC, providing further insight on the essence of the discussion said the Covid-19 pandemic has thrown significant challenges to businesses across the globe.
The impact of this devastating crisis brought by the pandemic affects the insurance industry in multiple ways such as policy payouts, revenue loss, liquidity, technology and market shifts.
Each of these considerations, the FITC said has its distinctive challenges and if harnessed constructively, can be a great source of innovation and growth. The impact of this pandemic on the insurance industry varies from employee and business continuity issues to client service considerations to the financial outlook.
According to them, insurers are responding to the widening outbreak on multiple fronts—as claims payers, employers, and capital managers. Each has its own distinct challenges, not just for the insurance industry, but for the economy and society at large.
