Insurance

The current trend of poor implementation of national budget may also have adverse effect on insurance sector as government remains a major player in the economy, as most underwriters rely on the public sector to generate huge premiums.

Although, analysts have projected that if President Goodluck Jonathan could make good his promise during the presentation of 2013 National Budget before the National Assembly last week, it would eventually translate to better business for underwriters as the government had mandated all Ministries, Department and Agencies (MDAs)to adequately insure their properties. 

The president said in his budget presentation that “You will recall that in my 2012 budget speech, I announced fiscal measures on rice, cassava, wheat, and machinery for the agriculture and power sectors”. This will translate to business opportunity for the industry as it provides insurance facility aimed at reducing risk costs. 

The Managing Director/CEO of Nigerian Agricultural Insurance Corporation (NAIC), Mr Kwatri Yusuf, noted that NAIC as a major stakeholder in the agricultural insurance business was positioned to improve on products offerings and services in agro investment risk management.

However, industry watchers were of the opinion that as the budget provides wider opportunities for the industry to achieve its set vision to attain a premium of N1.2 trillion from its current N200 billion, poor implementation of the budget might spell doom for the industry. 

Investigations revealed that some MDAs had adequately placed policies with various insurance companies but were unable to conclude the process due to their inability to determine how to fund the premium in the 2012 budget, in effect; most were not covered and might find it difficult to make claims on their insurance policies.

Observers were of the opinion that this trend portends danger for the viability and continued existence of the Nigerian insurance industry because when insurance premiums are paid after the loss has occurred, the insurance industry is the major loser. 

This is because the industry is denied the benefit of investment of the funds. This erodes the reserve of the insurance companies, and by extension, the entire industry and violates the basis of insurance operation, and insurance Act stipulates no premium no cover. 

Seven years after the official launch of National Health Insurance Scheme (NHIS) by the Federal Government to provide easy access to adequate and affordable healthcare for all Nigerians, some of the state governments are yet to show interest.

According to the Nigerian Tribune findings, less than 20 per cent of the state governments have shown interest in the scheme while some that have indicated interest are yet to back it up with financial commitment. 

Although, investigation revealed that the scheme was currently thriving on the patronage of some multinational establishments, but the attitude of Nigerian government and other private organisations, according to industry watchers, was not encouraging. 

The Federal Government on June 6, 2005 officially launched National Health Insurance Scheme (NHIS) to provide easy access to healthcare for all Nigerians at an affordable cost through various prepayment systems. 

This became imperative with the dwindling funding of healthcare in the face of rising cost and the need to secure universal coverage and access to adequate and affordable healthcare.

But quite unfortunate that the scheme, although adjudged as one of the fastest growing social health insurance schemes in the world, has suffered popularity among common citizens as only few states of the federation have shown interest in participating in the scheme.

The scheme was designed to facilitate fair financing of health care costs through pooling and judicious utilisation of financial risk protection and cost-burden sharing for people, against high cost of health care through institution of prepaid mechanism, prior to their falling ill.

Seven years after the commencement of the scheme, less than five million Nigerians had subscribed to the scheme out of over 150 million population.

Chief Medical Director, Federal Medical Centre, Abeokuta in Ogun State, Mr Dapo Sotiloye, has enjoined Nigerians to embrace the scheme, noting that there were lots of advantages in it. 

Sotiloye said, “I will not say Nigerians have fully taken advantage of it, but we have to start somewhere and that is why I commend the Federal Government for the scheme. The scheme, if well embraced, will eliminate problems usually associated with accessing health care delivery.”

The Nigerian Council of Registered Insurance Brokers (NCRIB) has inducted 32 new insurance brokers, buoying its membership strength to 492. 

President of the Council, Laide Osijo, told the newly inducted brokers to brace up for the unfolding global and regulatory challenges confronting professionals in the financial sector. 

Osijo opined that the new inductees must  operate within the laid down ethical and professional standards prescribed by the council as well as other regulatory institutions.

“You are coming in at a time when insurance business and operators in Nigeria are being challenged by several factors, notably; public image and global regulatory prescriptions and you must strive to play above board.” 

The NCRIB president used the occasion to commiserate with families of those who lost their loved ones and valuables in the flood currently ravaging some parts of the country. 

She advised government to evolve proactive disaster management strategies aimed at combating similar calamities in the future, as well as constantly educating Nigerians on the need to avoid building their residences on flood prone areas as well as eschew habits that could make the society vulnerable to such disasters. 

Osijo said the insurance industry could be a succour for mitigating losses that might result from such calamities both at the individual and government levels when fully embraced.  

In a lecture on ethics and professionalism, the Deputy President of the council, Mr Ayodapo Shoderu, advised the inductees to be ingenious in developing insurance products that meet the desires of the insuring public. 

Underwriters in Nigeria have been enjoined to offer products that will be acceptable and give excellent after sales services in order to improve on the fortunes of the insurance industry.