Digital identity policy will drive insurance growth, say experts
Stakeholders and experts in the technology and insurance sectors of the economy have stressed the need for a policy mandate to make digital identity compulsory as a means of driving insurance growth.
The experts noted that the Nigerian insurance market has a $100 billion potential and could become one of the biggest sources of internally-generated revenue (IGR) for the nation if properly harnessed.
This was the highlight of the second edition of Digital Identity Matters, a thought leadership webinar series for driving conversations on contemporary issues in identity technology, organised by VerifyMe Nigeria, leading identity verification and Know-Your-Customer (KYC) technology company, in partnership with Tech Cabal, a future-focused publication that speaks to African innovation and technology in depth.
Panelists included at the webinar included co-founder/CEO, VerifyMe Nigeria, Esigie Aguele, Chief Digital Officer, AXA Mansard, Bayo Adesanya; Chief Executive Officer, Thrive Agric., Adia Sowho while co-founder, Awabah, Tunji Andrews, moderated the session.
Speaking on the theme, ‘Why Insurance is Important for the Growth of Nigeria’s Digital Economy’, co-founder/CEO, VerifyMe Nigeria, Esigie Aguele, noted that insurance penetration in Nigeria was currently at an abysmal level of about one per cent.
He said: “For a population of 200 million people, we only contributed $1 billion to Gross Domestic Product (GDP) last year. South Africa, which has a third of Nigeria’s population, has a penetration of 17 per cent and a GDP contribution of $50 billion. Stakeholders must put in efforts to ensure that insurance is available to more people to grow the digital economy.
“For a company like VerifyMe, we have the technology and APIs, but there needs to be strong regulation to close the credibility gap in the insurance market and drive compliance, even with the one per cent who are insured. For instance, we need regulation to ensure that the right ID is matched to the right product. For vehicle insurance, we have to ensure that all motorists have proper insurance and driver’s licenses.
“This will expedite the adoption of data-as-a-product solutions that use ticketing scores to set insurance premiums. These are some of the mandatory regulations that can be put in place while we continue to work on the economic issues that will change cultural perceptions to grow the market much bigger.”
Chief Executive Officer, Thrive Agric, Adia Sowho, expressed the view that the Bank Verification Number (BVN) and National Identification Number (NIN) show that in a low trust environment, enforcement of regulation should be balanced with reward.
He stressed that to drive mass-market adoption in Nigeria consumers must be nurtured to see how insurance can work for them daily to protect their wealth in whatever form that manifests in their lives.
“We can start with assurance, a more structured ajò model and as trust is built at that level, people can be up-leveled to more elitist products. As long as we focus on the elitist end of the story, it will be challenging to achieve mass adoption,” Sowho noted.
However, the Chief Digital Officer, AXA Mansard, Bayo Adesanya, observed that insurance growth lies in the emerging consumer retail economy.