Diversify products to attract patronage, expert tells operators
Insurance operators in the country have been urged to ensure the development of value-oriented products to gain more patronage for the industry.
The Head, Financial Inclusion Secretariat, Central Bank of Nigeria, (CBN), Temitope Akin-Fadeyi, who gave the advice at the just-concluded National Insurance Conference in Abuja, said the importance of the sector cannot be overemphasised, as it can be useful across financial sector.
She said CBN and other stakeholders had been on the vanguard of searching for ways of expanding insurance penetration in the country, but noted that segmentation was key to reaching the financially excluded, while urging operators to leverage micro insurance to grow the bottom of the pyramid in the country.
“Segmentation is important as there are customers that are at the bottom of the pyramid- the poor and people at the grass root. As we develop products, there is a strong call for the non-interest insurance because no matter how we package insurance, some people for religious reasons will not key in.
“So, as we push micro insurance, we need to also sell the non-interest component like the takaful because we know that a strong set of our population believe in that way of life.
“At present, we do not have many operators that are pushing that form of insurance. So, as we are considering expanding the insurance industry and financial inclusion, let us put that into consideration,” he said.
According to her, financial inclusion is about expanding the space, bringing more people into the formal economy, adding that insurance penetration, which was said to be just about two per cent of Nigeria’s population could be increased if the right cover and various options were offered to Nigerians.
She urged stakeholders to also key into the bank assurance framework to help achieve financial inclusion in the country, saying: “We can partner across this phase to serve the segment we are trying to reach as it covers the two sectors.
“On one phase, it serves the banking client and on the other phase, that banking client can become an insurance client.
The commission has done its part, the policy framework is there, the guideline is there, the market also needs to rise and take advantage of this opportunity.
“We all have a role to play and we need to do more because the financial inclusion target of December 2020, is close. We need to be committed to meet the number of the financial inclusion target to better the lot of our citizens through insurance,” she added.
The Managing Partner at Prohouse and System Limited, Dr. Ndubisi Chinedu, said Nigeria has the population to drive financial inclusion, as about 37 million of the population are involved in micro enterprise and the major challenge they face is access to credit.
He said it was important to develop products that would ensure this group of people have access to credit facilities.
“The public does not trust us in the industry and we need to make a lot of efforts on this. This is because if they do not trust us, it will be difficult for them to key into anything that we are introducing in the market,” Chinedu said.
Also, the Learning Manager of Old Mutual Nigeria, Olu Okunnu, urged operators to ensure the use of technology, saying: “Technology must be brought in, in terms of innovation, because when this is done, trust will begin to build and more people will key into insurance.”
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