• Thursday, February 29, 2024
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BusinessDay

Experts urge innovation, market development policies for insurance industry growth

Putting ‘MIDAS’ touch to insurance regulation

Stakeholders in Nigeria’s insurance industry have been urged to focus on innovation and market development policies to drive the sector’s growth.

They believe the insurance industry has huge potentials, and therefore requires collaboration of the operators and the regulators as well as government to unlock its growth.

Doyin Salami, CEO, Kainos Edge Consulting, who spoke on the theme “Regulation, Innovation and Business Growth” at the 2019 National Insurance Conference held in Abuja, said the insurance industry must be ambitious and drive policies that focus on innovation and market development.

Salami also noted that the relationship between the regulator and the operator must be robust, where operators could honestly and frankly talk to the regulator for the betterment of the industry.

According to Salami, regulations must focus on driving innovation so that the market can open up for new products, partnerships and new consumers.

To the operators, he noted that the regulated must be honest and transparent in their dealings to be able to enjoy good relationship with the regulator.

He also said insurers were not innovative creators, urging that they domesticate successful innovations from other markets, but give it global outlook.

Mohammed Kari, commissioner for Insurance, who recalled some of the market development initiatives being driven by NAICOM under the Market Development and Restructuring Initiatives (MDRI), said the challenge with the industry was policy resistance.

If directors of insurance companies play their roles effectively, there will be less work for NAICOM because everything will ordinarily fall in place, Kari said.

He however said it was unfortunate that some directors, instead of blaming their managements for non-performance or other issues about governance, they blame NAICOM. They blame us for non-payment of dividend, non-payment of claims, no growth of premium and all that, the commissioner said jokingly.

Tunji Oluyemi, managing director/CEO, Tespauruth Consulting, a discussant at the panel session, said innovation and market development policies were key to insurance business growth, supporting Doyin Salami’s position that these were growth keys.

He said the Tier-based capitalisation policy earlier initiated by NAICOM was a well thought out policy that considered capital utilisation, risk management as well as capacity.

He said the new capital regime, which requires companies to shore-up their paid up capital, was going be a bit daunting and demands more innovations to make the capital work.

Owolabi Salami, executive director, Allianz Nigeria, said the policy on new capital being driven by NAICOM was for the good of the industry, stating that chief executives must put on their thinking cap for innovations and creativity to grow the business.

Rotimi Okpaise, actuarial expert at EY Nigeria, said a key policy that would impact positively on insurance and drive growth was awareness that brings out the value proposition in insurance.
He noted that a recent research he was involved in came out with shocking report that revealed awareness was major challenge for insurance.