• Sunday, December 10, 2023
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Insurance sector restates support for economy despite headwinds

How premium under-pricing is dwarfing insurance sector growth

Insurance sector under the umbrella body of the Nigerian Insurers Association (NIA) has reaffirmed its commitment to the nation’s economy, businesses and protection of national assets despite economic headwinds.

NIA said that despite the economic downturn being experienced in Nigeria with its cataclysmic effect on all aspects of our national life, the industry continues to take its pride of place in the Nigerian economic space, driver, restorer of businesses and a dependable safeguard for national assets.

Rising from its 57th annual general meeting in Lagos, the NIA announced a gross written premium of N726.2 billion in 2022, a 33.9 percent increase from N569.1 billion in 2021.

Segun Omosehin, chairman of NIA, speaking at the meeting said, “the insurance industry as a subset of the national financial system also had a fair dose of the general economic and socio-political problems bedevilling the country in the past year.”

He listed some of challenges to include perennial power outages, internecine conflicts between herders and farmers, menace of kidnappers and bandits, insurgency in the northeast especially around Lake Chad basin, and poor infrastructural facilities.

Others are galloping inflation, rising unemployment, flooding and other natural catastrophes, increasing poverty levels, and the geometric rise in exchange rate of the naira to the dollar, which continues to be a major challenge to businesses, resulting in high cost of operation.

Omsehin said notwithstanding these challenges, insurance companies continue to discharge their obligations as financial intermediaries and restorers of businesses in line with their mandate.

“The association is working closely with the National Insurance Commission (NAICOM) and other stakeholders within the financial services and technology segments to promote the business of insurance and increase its contribution to national GDP, and it’s expected that some of these initiatives will lead to increased insurance penetration and density, he said.

He listed some of the initiatives to include the Consolidated Insurance Bill 2020; New Premium Rate for Motor Insurance, ECOWAS Brown Card Scheme, NIA, Moroccan Insurers Technical Agreement, and Energy and Allied Insurance Pool of Nigeria.

Yetunde Ilori, director-general, NIA said the association was partnering with the Lagos finance ministry and Motor Vehicle Administration on the integration of platforms for the issuance of e-third party insurance.