Issues around settlement of claims seems to be the biggest challenge facing the insurance industry today, which also has continued to cast shadow on the relevance and contributions of the industry to business survival and growth.
While customers get discouraged most times as a result of delay, or rejection of claims by the insurers, its effect kills consumer confidence and trust, and eventually goes to affect premium growth in the industry.
However, at the second interactive session with consumers of insurance products and services organised by the National Insurance Commission (NIACOM) held in Lagos, it was clear that lack of adequate knowledge of the operations and ‘modus operandi’ of the contract of insurance has lead to most of the lingering issues on claims.
The event was attended by the National Insurance Commission, the Chartered Insurance Institute of Nigeria; the Nigerian Insurers Association, corporate consumer of insurance including Airline Operators Association of Nigeria, police, military, Federal Road Safety, Customs; Brokerage fraternity and the Agents.
While insurers defended their actions based on the terms of the contract, most of the consumers hold on the fact that having paid premiums what they want is payment of their claims.
But these opened the eyes of the stakeholders on the need to continue to engage with each other for knowledge sharing, need to engage the services of brokers as intermediary, and not just brokers, but those with experience and skills on the particular area of the business that is to be insured.
On sectors like aviation risks, the meeting brought to the fore of a better collaboration that requires the consumer to engage the services of brokers and reinsurers based on their professional competence and expertise rather than by sentiment of friendship or family.
While the underwriter on the other also should be allowed to select co-insurers on the risk without the consumer influencing it, so that when claims arise, underwriter could take responsibility and make sure payment is made to the insured without much delay.
For the police and military group life insurances, NAICOM representative was on hand to explain that the initial challenge with that scheme was lack of data for covered personnel’s, which lead to a lot of un-reconciled claims, except the case of 2014 that was as result of the liquidity issue with the lead underwriter. But he noted however that with data now in place, claims are now resolved faster than before.
Eddie Efekoha, president of CIIN, and major player in the aviation insurance provided insights on some of the issues raised, while Ibrahim Adamu of NAICOM promised further engagements to look at the issues raised by the consumers.
Sunday Thomas, acting commissioner for Insurance in his welcome speech earlier said that customers’ satisfaction is central to the sustainability and success of every business, insurance inclusive.
“We are aware of some of the obvious challenges bedeviling the sector either on the side of operators, consumers, investors or regulator. These challenges could be very overwhelming, however we must not relent in looking for better ways to effectively and efficiently ensure delivery of quality services to policyholders.”
Thomas who was represented by Adamu Balanti, a director in the commission noted that from the regulatory perspective, policyholders remains a key component of the commission’s primary constituency and therefore must ensure they are treated fairly and protected as enshrine in the relevant laws; while at the same time balancing the supervisory role of ensuring financial soundness and reliability of insurance institutions in the country.
He said that the Commission took the step in 2018 to incept this platform that will provide the most critical stakeholder in the sector which is the consumer, the opportunity to be heard and be informed first-hand on the workings of the sector.
“It is imperative to note that NAICOM is well positioned to ensure adequate protection of policyholders at all times. As you may all be aware, the topic on consumer protection has become central to regulators around the globe and the insurance sector is not an exception. Continuing efforts and new reforms are being put in place by NAICOM to ensure prompt payment of genuine claims by insurers, Thomas said.
According to him, the Complaints Bureau Unit of the Commission has also been working assiduously to resolve policyholders’ issues relating to non-settlement of claims, contract agreement violation etc.
“It is pertinent to inform you that the Unit has been further enhanced with the deployment of more staff at very senior level to effectively discharge assigned responsibilities. Its doors are widely open to receive and resolve, as much as it can, issues on non-settlement of genuine claims from the public.”
“The Commission has strong passion that insurance consumers are served right and feeling your pulse on the services offered you by your insurers will feed us with ingredients needed to strategise on repositioning the industry for better services.”
There is no doubt that we all desire a paradigm shift from the current state of our industry to a better state where we will not be grumbling on issues of prompt claims settlement, pricing of insurance products, value for money, innovative products etc, he said.
“Henceforth, insurance companies will be assessed and ranked on the quality of their service delivery to customers and the ranking of companies in this regard will be made public in order to provoke healthy competition among insurers. This we believe will boost consumers’ choice and confidence in insurance.”
Modestus Anaesoronye
