Leading the Digital Transformation of Nigeria’s Insurance Landscape – Oludayo Odunfa

Mr Oludayo Odunfa, a senior finance professional in the insurance industry, with over 14 years of progressive experience across finance, accounting, and consulting in the financial services industry narrates to Kolawole Olaniyi the large-scale transformation initiatives that have bridged emerging technology with strategic finance and reshaped how organisations operate on a global scale.

Please tell us a bit about your journey in the insurance and financial services industry?
My journey in the insurance industry began over 14 years ago when I first stepped into the world of accounting and finance. I started my career in accounting and gradually moved into strategic roles where I could apply my technical expertise as well as my passion for innovation. Over the years, I’ve had the opportunity to work across various facets of the financial services sector—from core finance and accounting to consulting and transformational leadership. My qualifications, including ACCA and CPA credentials coupled with an MBA, have provided me with a robust framework to understand both the granular financial details and the broader strategic vision needed in today’s rapidly evolving market. In my roles, I’ve been fortunate to lead transformation initiatives that integrate cutting-edge technologies with traditional financial systems. These projects have not only modernised operations but also redefined how organisations manage risk and drive growth on a global scale.

With such a rich background, how have you observed the global insurance landscape evolve over the years, particularly with the integration of new technologies?
The evolution in the global insurance industry has been profound. Traditionally, insurance was often characterised by cumbersome paperwork, slow processing times, and a heavy reliance on legacy systems. However, over the past decade, the industry has undergone a significant transformation driven by technological advancements and shifting market demands. One of the most notable changes is the integration of advanced data analytics and artificial intelligence into everyday operations. For example, the use of AI in underwriting has dramatically reduced processing times and improved accuracy by allowing insurers to analyse vast datasets more efficiently. This not only speeds up decision-making but also minimises human error, leading to more precise risk assessments.

Moreover, blockchain technology is emerging as a critical tool in enhancing transparency and security in transactions. By automating aspects of claims processing and contract management, blockchain ensures that the entire process is both tamper-proof and verifiable in real time. These innovations have reshaped the operational framework of insurance companies, turning what was once a static, paperwork-heavy industry into a dynamic, tech-driven marketplace. Global direct premiums have surged, reaching nearly USD 6.8 trillion in 2021, which is a testament to the industry’s resilience and adaptability. This surge is not just reflective of increased market size but also of the deeper penetration of technology that is enabling insurers to offer more personalised and efficient services.

Nigeria, as a market, appears to be at a unique juncture. How do these global trends manifest in the insurance sector, given its distinct challenges and opportunities?
Nigeria presents a fascinating case study. On one side, we have a country with immense potential—a population of over 200 million, a rapidly growing middle class, and an entrepreneurial ecosystem that is eager to innovate. However, despite these advantages, the insurance penetration rate in Nigeria remains strikingly low at approximately 0.5 per cent. This gap is significant; millions of individuals and businesses remain underinsured, leaving them exposed to unforeseen risks.

The low penetration rate is not merely a statistic; it is a reflection of deeper issues, such as limited consumer awareness, a lack of trust in traditional insurance products, and the prevalence of outdated operational models within many local insurance firms. Yet, these challenges also open up incredible opportunities. With the widespread adoption of smartphones and the success stories from the fintech space—exemplified by companies like Paystack and Flutterwave—Nigeria is well-positioned to embrace digital transformation in insurance. By introducing tailored products like microinsurance, which are designed to be affordable and accessible to the vast informal sector, and by leveraging mobile technology for distribution, there is significant potential to bridge the existing coverage gap. Furthermore, with a more robust regulatory framework and innovative public-private partnerships, Nigeria could see a radical transformation of its insurance landscape, making it more inclusive, resilient, and responsive to the needs of its citizens.

Speaking of technological integration, what global shifts do you believe are currently the most influential in redefining how insurance products are developed and delivered?
Technology has become the linchpin in the evolution of the insurance industry. One of the key shifts is the digitisation of core processes. For instance, traditional underwriting, which once took days or even weeks, can now be completed in a matter of hours or even minutes; thanks to advanced data analytics and AI. Insurers are now capable of processing vast amounts of information—ranging from historical claims data to real-time market trends—allowing them to make informed decisions more quickly and accurately.

Furthermore, consumer expectations have evolved in tandem with these technological advancements. Today’s policyholders are not satisfied with merely having a safety net; they demand a comprehensive, personalised experience. Insurers are responding by developing products that offer value beyond basic coverage. For example, many are now incorporating wellness programmes and digital tools that provide continuous monitoring of health and lifestyle metrics. These initiatives help insurers build a more meaningful, ongoing relationship with their customers.

Another global trend is the adoption of blockchain technology to enhance transparency and security. By digitising contracts and automating claims processing, blockchain not only reduces fraud but also builds trust with consumers. This is particularly important in a market like Nigeria, where historical skepticism about insurance practices has impeded growth. As these global trends continue to evolve, the challenge for insurers—both globally and in Nigeria—is to seamlessly integrate these innovations into their traditional business models, thereby creating a more efficient, customer-centric ecosystem.

There has been a lot of talk about AI liability insurance. Can you touch briefly on what the current global trend is, the impact it has worldwide, and specifically how Nigerian insurance companies can ride this wave?
The current trend in AI liability insurance revolves around closing the coverage gaps in traditional policies, which often don’t fully address AI’s unique risks—like algorithmic bias or data privacy breaches. Add in mounting regulations holding companies accountable for AI-driven errors, and there’s an unmistakable push for specialised coverage and stronger AI governance globally. Nigerian insurers are well-positioned to tap into the country’s thriving tech ecosystem, especially in sectors like fintech, agritech, and e-commerce, by crafting liability products specifically tailored to these fast-growing AI applications.
From a revenue perspective, insurance and insurtech firms stand to benefit significantly by stepping in to fill this market gap. By developing bespoke AI liability products and pairing them with value-added services—such as real-time risk assessment and regulatory compliance guidance—insurers can create new premium streams and position themselves as trusted partners. In Nigeria, where both innovation and regulation are evolving at a rapid pace, early movers that invest in AI-focused underwriting expertise can differentiate themselves and establish a solid foothold in this promising market

Modern policyholders certainly have higher expectations than in the past. Can you expand on what today’s consumers are looking for in their insurance providers?
Today’s consumers are increasingly tech-savvy and expect a level of personalisation and immediacy that was unimaginable a few years ago. They want insurance solutions that are not only responsive but also predictive. In practical terms, this means that rather than waiting for an event to occur before seeking assistance, policyholders want real-time insights and alerts that help them mitigate risks before they escalate into major issues.

For example, in the realm of auto insurance, there is a growing trend where companies are utilising telematics and GPS data to provide drivers with real-time traffic and hazard alerts. This proactive approach not only enhances safety but also reinforces the customer’s trust in the insurer’s ability to offer relevant, timely advice. Similarly, in health insurance, the integration of wearable technology allows for continuous monitoring of vital statistics. Insurers are beginning to offer incentives—such as reduced premiums or rewards—for policyholders who maintain healthy lifestyles, as evidenced by partnerships with companies that produce fitness trackers.

The demand for transparency is another critical aspect. Modern consumers expect clear, concise communication about their policies, claims processes, and any changes that might affect their coverage. They appreciate when insurers go the extra mile to explain complex terms in layman’s language and provide accessible, digital platforms where they can manage their policies independently. In essence, the modern insurance customer values a relationship that is interactive, data-driven, and geared toward not just reacting to incidents, but actively preventing them.

Reflecting on your impressive career, what advice would you offer to senior professionals in the insurance industry who are focused on transforming their organisations to remain competitive?
For senior professionals, the path to transformation starts with cultivating a forward-thinking mindset while honouring the fundamental principles of finance and risk management. One of the most important steps is to invest in technology—not as a mere upgrade, but as a strategic enabler. Emerging technologies such as artificial intelligence, blockchain, and cloud computing are not optional; they are essential to remaining competitive in today’s rapidly evolving market. Senior leaders need to be champions of change within their organisations, fostering an environment where innovation is encouraged and cross-functional collaboration is the norm.

It’s also vital to have a clear vision of how technology can be integrated with existing processes. This might involve redesigning workflows, investing in training programmes for staff, and rethinking traditional business models to incorporate digital tools. Strategic partnerships are equally important. Collaborating with technology startups or even academic institutions can provide fresh insights and help accelerate the implementation of new solutions. It’s about creating a culture where calculated risks are seen as opportunities for growth rather than threats. Ultimately, senior professionals must lead by example, demonstrating that transformation is not just about technology, but about reimagining the entire value chain—from customer engagement to claims processing—and creating a sustainable competitive advantage in an increasingly digital world.

And for those who are just starting their careers in the insurance industry, what foundational advice would you impart?
For newcomers, I’d say the insurance industry is both challenging and immensely rewarding. It is crucial to build a strong foundation in the core principles of finance, risk management, and regulatory frameworks. However, equally important is developing an understanding of the digital tools and technologies that are reshaping the industry. Early in your career, focus on acquiring skills in data analytics, financial modeling, and digital finance. These areas are rapidly becoming the pillars upon which modern insurance practices are built.

I also encourage young professionals to remain curious and adaptable. The pace of change in our industry is extraordinary, and the ability to continuously learn and update your skill set will be invaluable. Seek out mentorship from experienced professionals who have navigated both the traditional and the digital aspects of insurance. This guidance can help you understand not only the theoretical underpinnings of the industry but also its practical, day-to-day challenges and opportunities. Networking is also a critical component—engage with professional associations, attend industry conferences, and take advantage of online communities. These interactions can provide insights into emerging trends and innovations, allowing you to position yourself at the forefront of the next wave of industry transformation. In essence, combining a solid technical foundation with a willingness to embrace new technologies will empower you to make a significant impact in the insurance sector.

Looking to the future, what is your professional outlook for the Nigerian insurance industry, and what key factors do you believe will drive its transformation in the coming years?
I am extremely optimistic about the future of the Nigerian insurance industry. The country is at a pivotal moment where technological advancements, demographic shifts, and a growing entrepreneurial spirit converge to create an environment ripe for transformation. A youthful, tech-savvy population combined with increasing smartphone and internet penetration sets the stage for widespread digital adoption. This, in turn, opens the door for innovative products such as microinsurance and usage-based insurance, which are tailored to the unique needs of the Nigerian market.

Furthermore, I believe that regulatory reforms will play a crucial role in this transformation. As regulators become more adept at balancing consumer protection with the need to foster innovation, we can expect a more stable and inviting environment for both local and international investors. Strategic public-private partnerships will also be key. By working together, insurers, fintech innovators, and government bodies can develop comprehensive solutions that address both the risks and opportunities inherent in the market. In my view, the next few years will witness a paradigm shift in how insurance is perceived and delivered in Nigeria—from a legacy system struggling with low penetration to a dynamic, technology-driven sector that not only mitigates risks but also fuels economic development and social progress.