Measuring the role of insurance in terms of contribution to economic development in line with the country’s 59 independence anniversary, those behind the wheels in the risk management industry says the sector is moving in the direction of the dynamics of the economy.
The economy is evolving, we are not yet there as a nation, but we are moving and that is the same with insurance business, the Nigerian Insurers Association (NIA) said.
Yetunde Ilori, director general of the NIA said as an industry we have evolved, doing quite a lot of the thing we were unable to do before, we are innovating and providing great risks protection for the Nigerian people.
She said that a lot could be done by the industry, believing that as Nigeria develops, the insurance industry will continue to play more effective role in giving protection to life and properties.
Insurance business will spike when SMES, individuals are able to have increased access to credit and that is the direction the economy should be heading, experts said.
They believe that Small and Medium Scale Enterprises (SMEs) are a very important sector in the economy that must develop for there to be economic growth and development.
Beyond contributing to the GDP of the country, the SMEs sector holds the key for employment generation and poverty alleviation, which are key measurement indices for any economy, and that is why this collaboration with insurance industry is critical.
Insurance therefore is major component of access to credit, such that people or business are granted credit or funding when there is insurance guarantee, that is, in the event of default, insurance comes to their rescue.
In this vein, finance institutions like micro finance banks are easily given out monies to SMSEs, while car companies, equipment firms, electronics and home appliances establishments are also at peace, giving out credit which will be repaid over a period of time.
In Nigeria, access to credit was up after the banking industry consolidation in 2005, but has gradually disappeared as the economic situations worsened, indicated by the collapse of the middle class, increasing loss of job, closure of factories and industries, among others.
Ebelechukwu Nwachukwu, managing director/CEO, NSIA Insurance Limited had during an interactive session with journalist that credit is the engine of insurance business growth. Until we begin to have access to credit as citizens, growth of insurance will take longer time to come.
Jerome Gotcsche, a retail marketing expert said the SMSE industry in Nigerian is hugely untapped and its growth requires the support of insurance.
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