‘Less than one per cent of Nigerians are insured’
Rotimi Adekunle Olukorede is the Managing Director/CEO of Floodgate Insurance Brokers Limited. A versatile insurance underwriter and broker, with over 30 years insurance experience, he attended the University of Lagos and bagged a Bachelor of Science Degree in Insurance and a Masters Degree in Public Administration from University of Ado Ekiti. He is an alumnus of the Pan African University and associate member of the Chartered Insurance Institute London and Nigeria. Olukorede has served the Lagos Area Committee of the Nigerian Council of Registered Insurance Brokers (NCRIB) in various capacities currently its chairman. In this interview with IJEOMA THOMAS-ODIA, he shares his concerns over the Nigerians perception of insurance among other issues.
Take us through your journey as a stockbroker?
My journey as an insurance practitioner began in 1983 when I was given admission to read insurance at the University of Lagos. I didn’t know anything about the profession but an Uncle Dr. Ajayi of the engineering department at the time assured me it was the profession of the future. He encouraged me to go ahead so I did. When I graduated I served in Oyo state Trans Assurance. Getting a job was much easier in those days. And I was also flying and changing jobs almost every two years. In the process I worked with Sentinel Insurance, Kapital Insurance (now Unity Kapital), Regency Insurance, Equity Assurance limited, First Assurance Plc, Equity Assurance again and then Great Nigeria Insurance Plc from where I conceived the idea of owning a brokerage firm and standing on my feet. I left GNI as Executive Director Business Development. After GNI I actually got an attractive offer from another insurance company but felt it was time to face Floodgate insurance broker and move on. And I thank God I have no regrets. Along the way I became a chartered insurer in 1994 and got my Masters in Public Administration in 2000. I also attended the Lagos Business School and became an alumni’s in 2009. I attended several international seminars, training and courses abroad and in Nigeria. The journey has been quite interesting and exciting.
As the CEO of Floodgate insurance broker Ltd, how are you building structures to outlive you?
As someone who knows my time in the industry is very limited, am in a hurry to establish standards in Floodgate. I am ensuring that standards are kept; hence we work with rules and follow procedures for all transactions. We are also making sure that policy guidelines are implemented. It has not been so easy but my aim is to lay a solid foundation and the step aside for whoever succeeds me to run with the vision.
How can the insurance industry be made more relevant to the economy?
The insurance industry is the last resort when disaster and accidents happen. The Nigerian Insurance industry has played a pivotal role in reducing the effect of misfortune on Nigerians. But, the effect has been insignificant because less than one per cent of Nigerians are insured. So make insurance more relevant increase participation in insurance. Make it compulsory in all sectors and enforce the relevant laws on insurance. Right now we have several insurance laws imposing insurance on organisations but the government is not interested in enforcing this laws.
Insurance is a very valuable expense and because of its risk factor, you make people take it up. Nobody wants to pay for what may or may not happen. But governments all over the world make it happen because whenever the risk crystalises there is depletion is the national economic wealth of the nation, hence governments always emphasis on insurance. But here even governments use budgeted insurance funds for something else. They don’t really understand or care what may happen to the economy.
Given the role you play in the industry as an intermediary, how do you intend to maximise the potential of brokers towards achieving increased growth?
As the current chairman of the Lagos Area Committee of the NCRIB, my focus has been on taking advantage of digitalisation to drive the role of brokers in any insurance transaction. Our seminars and trainings have focused on this. The world has gone digital and we brokers must use everything available to drive our market to achieve her full potential. Before COVID-19 we started having meetings with micro, small and medium scale enterprises trying to sell insurance to them. We plan to fully participate in this year Lagos trade fair, and we have scheduled meetings with some other trade associations to preach the role of brokers in their insurance transactions. At the national level there has been a lot of engagements with hover executives and legislators. Some traditional rulers and prominent members of the society have been decorated as insurance ambassadors. There have been a lot of interactive engagements with the Insurers association. All this, hopefully, will contribute to the growth of our industry.
Beyond selling policies, what is the relevance of insurance brokers?
Beyond selling insurance, Brokers have been very active; we engage the governments on issues that concern our industry, we visit motherless babies homes with gifts. We visit schools to encourage the students to take insurance as a subject in their school. Recently the Lagos Area Committee visited Maryland comprehensive High school and gave a career talk. We gave them insurance textbooks, exercise books and T-shirts. The students decided to form an insurance club, which we are also supporting.
What are some of the challenges you face on the job and running the business?
The challenges have been coming but with God and personal commitment all things are possible. My first challenge was getting my license then. It kept dragging on until I was almost frustrated. I lost a lot of steam then. Thank God I succeeded. As a former underwriter I experienced the challenge of knowing what to do and how to do it. Its one thing to get a business it’s another thing to know how to handle it to the satisfaction of the customer. I had to submit myself to another broker and asked him to teach me. I know every profession has its secrets, which is gained by experience.
So I was under tutelage for few months and I am still learning the robes. Am blessed with a lot of friends in the industry and I call a number of them regularly when I need help. And some of them do help. I go for the big brokers who don’t see me as competition at all. It’s easier to get help that way. They have helped with my tax issues, regulatory returns to NAICOM and policy placements. These areas have been the most challenging.
As the 10th chairman of the Lagos area committee, how is the council working with NAICOM to resolve some issues affecting brokers?
Relationship between the council and NAICOM is handled at the national level but as a member of the board I can tell you we have a very cordial relationship with the commission. This is due to the personality of the commissioner himself. He is very receptive and ready to listens to us. We still have our differences but it’s being resolved. Secondly we also have an amiable and hardworking president. Therefore the council is very proactive and swift in responding to issues. Even at the legislative level there has been a lot of cooperation among all parties. The goal of all concerned is increasing insurance penetration in Nigeria.
How can customers in rural areas benefit from insurance even when premium goes for as little as #2000 or #4500. Does it help business to be lucrative?
Insurance is for both urban and rural dwellers. The benefit is even more for rural dwellers. They are the ones that suffer most when misfortune happens. They probably need insurance more. They need to recover fast to get back on their feet and begin to make money to help their families. So for them, insurance is key. Micro and Takaful insurance has taken off in Nigeria but has not gained the necessary acceptance from people and governments. Patronage is very low compared with the potential of that line of business. As brokers we have had road shows, market penetration activities but these are not enough. We need to do more. In other countries insurance is usually tied up with many government interventions to make people take up insurance covers against risk of fire, natural disasters, accidents, sudden death of breadwinner. These are critical issues that affect the survival of rural dwellers.
What is the relationship of brokers with underwriters in the conduct of business?
Relationship between insurers and brokers is quite cordial. There is better understanding of each other’s roles in the insurance value chain. The need to cooperate and please customers is appreciated. However I am aware that most underwriters feel they can do without the broker as this is reflected in their product design and policy procedures.
This is quite unfortunate because it is creating unnecessary competition and tension between both parties. The best thing would have been to encourage each other to stay on their individual lanes or roles. I am not saying underwriters should not have marketing departments, but should not deliberately edge out brokers from their business. As products and processes are designed, broker must be given access to be part of each transaction. It benefits everyone, the insurer, the broker and the customer. It also removes unnecessary friction between both parties and encourages more interactive activities.