As the Nigerian economy and the rest of Africa battles with tatters of economic difficulties brought by Covid-19 pandemic, the insurance industry has been urged to rise up and help rebuild the continent.
According to the government of Nigeria, insurance sector will play a vital role in the diversification of the economy by bringing “necessary stability, economic sustainability, revenue generation, job creation and financial inclusiveness.
“There is a great future for the Insurance industry in Africa. We only need to put the right mechanism in place for it to thrive, President Mohammadu Buhari said during the virtual address during the recently concluded African Insurance organisation Conference and General Assembly help in Lagos.
“I assure you that this administration has and will continue to support Insurance growth in Nigeria and Africa at large.”
Buhari who applauded the positive contributions made by the insurance sector in the wake of the Covid-19 pandemic, said the industry has moved beyond their core responsibility of mitigating risks to provide supports to government activities.
“I once again use this opportunity to commend the Nigerian Insurance industry for identifying with the government through the provision of life insurance set of packages for frontline medical and paramedical personnel in the course of this fight. Your support and solidarity in these times are highly appreciated,” he said.
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President Buhari said the theme of the conference, “Rebuilding Africa’s Economy: An Insurance Perspective”, was apt and well thought out to respond to the reality of the moment as many governments try to devise ingenious ways to manage their economy in the aftermath of the COVID-19 pandemic.
“The pandemic has indeed changed many perspectives that have forced leaders across the globe to think hard for remedies.
“I want to assure you that we in Nigeria are doing everything humanly possible to ensure coordinated approach to the pandemic and reaching out to other African leaders on possible best options to fully revive the African economy in which I strongly believe the Insurance industry has a vital role to play,” he added.
The President noted that the COVID-19 pandemic presented a global challenge which led to lockdown of many countries, travel restrictions, and issuance of many health protocols, affecting all human, social and economic interactions that made hosting of the Conference impossible in 2020.
“COVID-19 is still a serious challenge in many countries across the globe. However, adequate protocols have been put in place to curb its spread and vaccination is in progress.
“We understand as a government and nation the need to frontally tackle some of the disruptions to our social, economic and health occasioned by the pandemic by putting in place sufficient measures that allow the system to function.
“We are aware that the AIO’s Conference and Annual General Meeting is rotated amongst member states in order to provide a forum for exchange of information and strategies on market development while promoting regional knowledge and integration.
President Buhari said the federal government received the news of the decision of the Executive Committee of the AIO granting Nigeria the hosting rights of this 47th edition of the AIO Conference with pleasure, adding that as a country, Nigeria is ever grateful for the opportunity.
The Vice President, Yemi Osinbajo, who also aligned with the President by participating in the conference, while speaking at the closing ceremony applauded the operators for putting the country at the spotlights and charged them work towards having home-grown international insurance conglomerates.
He also encouraged insurance companies on African continent to leverage the African Continental Free Trade Area (AfCFTA) to increase productivity, adding that, every smart economic grouping, whether governments or businesses, must be thinking, planning and strategizing for these new times.
“The free trade agreement presents a major opportunity for African countries. By some estimates, if we get it right, we can bring several millions out of extreme poverty and raise the incomes of 68 million others who live on less than $5.50 per day. There are potential income gains of up to $450 billion, and just cutting red tape and simplifying customs procedures alone could drive up to $250billion of that sum,” he pointed out.
“So, what does all this mean for the insurance industry in Africa? Well, plenty of opportunities. More trade in goods will mean greater need for insurance services, brokers, in particular, should expect a boom; demand for trade facilitation services will rise, but obviously companies that already have market presence in other African countries, even if by collaboration, will benefit more than others,” he posited.
While expecting to see better capitalised insurance providers from other African countries coming to compete in the Nigerian market, he added that, “services can be set up faster than manufacturing plants. Nigerian financial services companies, especially banks, are already in many African Countries, the likes of Zenith, Access, UBA. How about Insurance companies? We should now be looking at developing home-grown international African insurance conglomerates. The time is now.” he said.
He maintained that there will obviously be opportunities for new insurance products and solutions, especially, in the property and casualty segment of the business, adding that insurance companies must also be prepared for the systemic nature of climate induced damage, with the possibilities of market failures and more system-wide destabilisation.
