Industry regulator, the National Insurance Commission (NAICOM) is making a new intervention that seeks to close skills gap of loss adjusters in the industry.
The loss adjusting space over time has not been attracting fresh brains underlining a critical challenge that the sector will have to face if nothing is done now.
According to analysts, that arm of the insurance industry has not been attractive in terms of remuneration for service (wages), making it unattractive for new graduates to take up employment in that space. While older professionals are aging, and no one is replacing them, raising concern as to what the future of the business entails.
NAICOM during the past week engaged the country’s loss adjusters in a training on oil and gas, having partnered with BMK Advanced Corporate Training of South Africa. The three days training held in Abuja.
Loss adjusting businesses, according to analysts, are being hit hard by poor revenue, not only resulting from their low payment scale compared with international counterparts, but also by underwriting companies who utilise their services, but owe them uncontrollably.
The implication therefore is that, the loss adjusting firms have become less sustainable, inability to pay quality remuneration, manpower shortage and increasingly less attractive to younger generation of job seekers.
This development analyst’s fear could result in total disappearance of the profession in Nigeria if unchecked, as the country would have to pay higher to get such servicers from other markets giving that the local market currently is dominated by aging players.
Loss adjusters are independent claims specialists who assist in the fair and just settlement of claims, including complex or contentious claims, on behalf of insurance companies and their clients, recommending appropriate amount for indemnity.
Darlington Mgbojikwe, managing director/CEO, Crawford Loss Adjusters Limited had told Business Day some time ago that loss adjusting profession in Nigeria was facing a difficult time, as it could hardly sustain itself.
“This development is affecting the technical and skills regeneration since we can’t afford to bring in fresh graduates and pay them or offer necessary trainings for staff.”
“In fact, we have a lot of aging adjusters and because the money we are making has not enabled us employ graduates that will take over from us, the profession is endangered.”
Today,available loss adjusters in the country are dominated by aging players who by design of faith could not seek for new careers by virtue of their age. So, their eventual exit could mean end of their business since it was becoming unsustainable and younger employees were leaving in droves for other professions, Mbojikwe stated.
According to him, the Nigerian Insurers Association (NIA)/ Institute of Loss Adjusters (ILAN) scale of fees reviewed in 2011 after about almost 20 years to 10 percent increment is still not implemented across board.
We are starved of revenue, and many of our members cannot change career at this age, Mgbojikwe noted.
While UK and other advanced markets underwriters pay between 6-7 percent of their premium for service charges to loss adjusters and lawyers, Nigerian underwriters still pay less than one percent of their premium, he hinted.
According to him, some loss adjusting firms was owed debts for reports it had done years past, stating that such development was dangerous for the profession.
Obinna Chilekezi, insurance lecturer and research expert said underwriting companies are they once killing the loss adjusters because sometimes they pay brokers commission, pay claims and don’t remember to pay loss adjusters for their service. It’s an industry problem and it is very unfortunate.
Chilekezi noted that many people are not taking careers in loss adjusting because of the technicality of that area, which ordinary qualification in insurance is not enough to be a loss adjuster. “Insurance graduates may have requisite knowledge to practice brokerage or underwriting, but cannot practice loss adjusting, except after going through a specilised course meant for it. It is highly technical, Chilekezi stated.
Sunday Thomas, director general of the Nigerian Insurers Association had said the NIA agreed that every loss adjusting fees must be paid within 90-days of submission of report to ensure that loss adjusters are better off in their job, saying it was in line with international best practice. “This decision is necessary to ensure they do their work professionally and without compromise. It is also part of efforts to encourage compliance and adopt international best practice, Thomas stated.
A loss adjuster is basically an insurance person who is trained to be able to handle insurance claims. By this I mean that you cannot be a loss adjuster without having a solid insurance background, that is, you cannot also be a high court judge without first of all being trained as a lawyer. Basically, a loss adjuster is an insurance person that has taking addition training in the handling of insurance claims. Handling insurance claims means being able to go the scene of the loss, investigate and with the claim submitted by the claimant relate what he claims as the loss to the actual loss
