Olumide Ibidapo, MD/CEO of FBN Insurance Brokers have to his credit over 30 years industry experience in insurance and risk management. In this interview with Modestus Anaesoronye shares his thoughts on recent happenings in Nigeria particularly the #EndSARS protest, eventual hijack by hoodlums and impact on insurance business; as well how clients could achieve maximum insurance protection going forward. Excerpt:
The recently embarked #EndSARS protest in Nigeria and the eventual hijack by hoodlums resulted to monumental losses in lives, assets and properties across the country. As an insurance expert, what is the implication of this on the industry?
The effect of this is quite huge. A number of the assets and properties destroyed are covered by one form of insurance or the other particularly for issues such as this. This is really why we exist as an industry and the industry is ready to live up to its responsibilities at this time.
We expect that there would be a lot of claims submitted by the insuring public at this time which will in turn affect the profitability of the industry this year. Nonetheless, we believe that there is sufficient capacity within the Nigerian Insurance industry to cater to the claims that would be made,
Furthermore, there is also a silver lining in the cloud for the industry as this series of events will further bring to the fore front the need for insurance in a country like ours. So we expect that insurance uptake in the following months will increase as the general public comes to terms with the essence of the industry.
Given the level of losses and importance of bringing succour to victims of these incidents including government, private businesses and individuals, who will be qualified for a claim?
This is really straightforward. Only properties that are insured are qualified to make claims. However, there might exist the problem of adequacy of coverage for some clients. It is common to see a lot of people in this part of the world underinsure their assets just to reduce cost. This I believe also highlights the importance of insurance brokers like ourselves who are able to provide insurance and risk advisory to ensure that individuals and businesses secure adequate cover for their assets and are also available to support in the event of a claim.
Explain the importance of insurance in protection of assets and businesses, particularly at times like this?
The importance of insurance cannot be overemphasized. Insurance at its core is a risk management/transfer strategy that helps individuals and businesses manage their risk by transferring the risk to an underwriter for a consideration called premium.
Risks are inevitable. The best we can do really is to manage them and insurance over the years has proven to be an effective tool for this purpose. No one could have foreseen the chaos and damage that has now occurred at the beginning of the year. However, while some businesses have to weep and worry about the future, others are rest assured because they have a cover in place.
What is the implication of one not having the right insurance protection in situations like?
The implication is that you become exposed to the very risk that insurance is designed to protect you from. There is virtually an insurance product for every kind of risk you can imagine. Even emerging risks such as cybercrime, political violence, sabotage and terrorism, kidnap and ransom also have products that can cover individuals and businesses in the event of a loss.
Again, our role as brokers is to help ensure that you get the right type of insurance that you or your business needs at every point in time at the right price.
Not insuring ones assets and business today looks like a business mistake, what impact does this have on the larger economy of the country?
We need our business performing at their best so that our economy can grow the way it ought to. Losses like some of the ones we have seen in these past days can cripple businesses and cause people to close shop. These past days, we have heard of stories of small business owners who have been unable to sleep due to the need to personally protect their franchises. But with insurance, you can sleep with your two eyes closed and focus on growing your operations rather than worry about risks that can take you out of business with the overall positive impact on the economy.
How will an insurance broker help people package their insurance to enable them make maximum claims in situations like this?
Insurance brokers have over the years built expertise, experience and relationships that put us in the best position to help our clients manage their claims. The work really starts from the inception of the policy. We have an obligation to protect the interest of the clients and understand that the reason they are taking the policy in the first place is because they anticipate the possibility of a claim. So right from there, we put in measures and systems in place to help the claims management process seamless.
However, we are also able to leverage our resources to help resolve borderline cases that clients cannot resolve on their own. All of these and more add up to the additional value proposition that insurance brokers have for the insuring public.
At FBN Insurance Brokers, how do you help clients understand the benefits of insurance and the right products to take?
At FBN Insurance Brokers, we take customer education really seriously. At the thick of the lockdown caused by the corona virus pandemic, we organized a virtual webinar on risk management and business continuity, having global industry experts as facilitators during the event.
We use every avenue that we have to consistently remind our clients and the public at large that insurance is really not a luxury to choose. It is a necessity for the survival and growth of businesses and the economy at large.
Could you give an estimate of what the insurance industry is likely to lose in current situation, in terms of claims payout?
The best way to estimate this is to estimate the value of the loss that has been suffered. This will give you a fair idea of the sum insured and that way you can tell what the industry is likely to pay as claims.
Clients/insured entities (corporate and individuals) are collating their losses presently and going by the large scale destruction witnessed, the claims payout is expected to be in billions.
Company Profile
FBN Insurance Brokers Limited is a wholly owned subsidiary of FBN Holdings Plc. FBN Insurance Brokers combines expert broking knowledge and capabilities for risk assessment, analysis, structuring and overall servicing that has resulted in increased insurance portfolios since its commencement of insurance brokerage business in July 1, 2000
We also work on a range of value added Risk Management services. We have the reputation, expertise and experience in Energy Insurance, Oil and Gas, sophisticated/complex Risk Management and Re-insurance services. We have developed operational and corporate alliances with international reinsurance broking entities – Howden One geared towards building capabilities, skills, knowledge update, improved professionalism and Best Business Practice
FBN Insurance Brokers Limited has its Headquarters in Lagos Nigeria and has branches in Abuja, Port Harcourt and Ibadan. We are also able to leverage FirstBank’s over 700 branches and its network of subsidiaries in Africa.
