Experts in the nation’s financial service sector have advocated the need for Insurance and Pension operators to adopt creative and innovative ways of doing business that impact product development and service delivery that will hasten the growth of the insurance and pensions sectors.
Financial services experts submitted to the 8th Annual National Conference of the Nigerian Association of Insurance and Pension Editors (NAIPE) held in Lagos with the theme: ‘Role of Insurance and Pension In Building Sustainable Economic Growth Under The New Government’.
The experts emphasized the need for operators to embrace continued workforce development and technology adoption, a panacea for driving growth in modern-day business.
They also urged the government to provide an enabling environment supported by relevant business-friendly and growth-driven regulations.
In his contribution at a panel session, Shola Tinubu, managing director/CEO of Scib Insurance Broker, spoke on the need for the government to adopt creative policies and regulations that are business-friendly and growth-driven for the insurance and pension sectors.
Tinubu advised the regulators to give operators a free hand to choose their ways of raising capital.
He said, “On the insurance side, capital had been driven by statutory requirements.
“We are talking about the regulator mandating the players to get a specific quantum of capital without creating ground for that capital.
“Meaning that companies have to strive for capital just to stay in business, and what has happened in the various rounds that we had was that there was no creative idea for channelling the money.
According to him, if any company decides to go to the capital market to raise capital, such a company will channel the money effectively for the growth of the business.
Tinubu noted that the industry needs a situation where operators will initiate capital level and use it to follow up investment ideas.
The managing director stated there is a need for investment managers who can digest investment ideas and see the things they need.
He explained that operators do not need capital to raise it but for investment opportunities that will yield higher returns.
In his view, Wale. Odutola, managing director of ARM Pension, represented by Abimbola Suleiman, ED, Investment, ARM Pension, said every household needs basic insurance and a basic pension plan.
Odutola noted that insurance and pensions have gone a long way in improving people’s lives.
He explained that government alone cannot engender sustainable economic growth; insurance and pension should be encouraged among the rural dwellers to better their lots.
“When insurance handles the risks for businesses and the Contributory Pension Scheme (CPS) takes care of Pension liabilities from the balance sheet of the companies, this will go a long way to ensure productivity and growth in the nation’s finance sector.
“There are currently nine million people in the CPS net, which is abysmally low compared to the nation’s population.
“Hence, there is a need to get all state governments involved and the participation of the informal sector in CPS,” he said.
According to Odutola, deepening the scope of participation requires innovations and creativity from operators in the insurance and pension sectors.
Prisca Soares, former secretary general of the African Insurance Organisation (AIO), said that the lack of skilled workforce, especially in the area of shortage of Actuaries, is presently challenging the insurance industry.
Soares said that the industry needs to deliberately attempt to develop its workforce and solve this significant financial reporting challenge.
She explained that investment in technology needed for actuaries had been challenging over the years but has become more critical.
“When you risk base capital, you need actuaries to get it right. The insurance industry needs conscious efforts to address this because it is critical to their business,” she said.
Also, Oguche Aguda, chief executive officer of the Pension Operator Association of Nigeria (PenOp), represented by Akinbola Akintola, head of the Research Department at PenOp, said the insurance and pension sectors are facing the same challenge of public confidence.
Oguche charged operators in both sectors to work on their images, adding that if there is no confidence, there is no growth and without growth of the two industries, the country’s economy cannot grow.
The group managing director of Consolidated Hallmark Insurance(CHI), Eddie Efekoha, represented by Tunde Adaramola, ED, Finance at CHI, harped on the need to enforce compulsory insurance and pension as the era of non-payment of claims has gone.
Efekoha urged operators in both industries to be honest with their businesses, gain consumers’ trust, and bridge their expectation gaps.