Home | News | Business | Expert explains challenges of insurance inclusiveness Nigeria
IOCs pay N828bn taxes, levies in 3yrs
N1.64bn fraud: Ex-Taraba Gov. Nyame justifies extra-budgetary expenditure

Expert explains challenges of insurance inclusiveness Nigeria

Abuja – Mr Pius Agboola, Director, Authorisation and Policy, National Insurance Commission (NAICOM), on Thursday identified distance of insurance providers to the unreached as a major challenge to insurance inclusiveness in the country.

Agboola told the News Agency of Nigeria (NAN) in Abuja, that most insurance companies were based in the city, pursuing corporate and government accounts without consideration for people in the rural areas.

NAN reports that the unreached are the financially excluded in insurance and are grouped as the financially poor.

They are unreached due to illiteracy, ignorance and distance.

According to Agboola, inappropriate products are some of the major challenges of reaching the unreached in the country.

“Matching of insurance products to the need of the unreached remains a critical factor as most companies still sell conventional products instead of new products.

“ Even in cases where the products are available, there are limited distribution channels to ensure the products get to the consumers.

“Apart from the recently-introduced Bancassurance, the sales force of insurance companies, insurance brokers and tied agents distribution channels that existed hardly approached the unreached,’’ he said.

Agboola explained that there was also the challenge of trust building initiative between the providers of insurance and the unreached, which according to him, is still very low.

He noted that trust was very critical in the sale of insurance to the unreached market as the people needed to understand who they were dealing with and the value and reliability of what they were paying for.

He named other challenges against insurance inclusiveness to include low awareness/consumer education, inadequate quality services and deployment of inappropriate technology.

He said low and irregular income, financial literacy, religious/socio cultural beliefs, legal factors and weak government support were other challenges of ensuring insurance inclusiveness.

On initiatives to enhance insurance access, Agboola said it was important to transform the informal and quasi-informal group into formal group, through appropriate distribution channels.

He stated that collaboration among the government, regulators, operators and the informal sector was important to ensure insurance inclusiveness in the country.

He said,“ innovative and appropriate technology, coordinated insurance consumer awareness and education, insurance suppliers/intermediaries expected improved actions and strong government commitment are also critical.

Agboola, therefore, urged stakeholders to begin to examine and come up with inclusive distribution models that had client understanding, product diversification, national outreach, rural advantage and trust with clients.

He said that the push and other related initiatives might have to be considered by the regulator.

“While government enhanced commitment is required, insurance correspondents/editors should also improve their knowledge on insurance, its operations and principles to promote insurance better. (NAN)

view more articles

About Article Author

Expert explains challenges of insurance inclusiveness Nigeria
Chuka (Webby) Aniemeka

Chuka is an experienced certified web developer with an extensive background in computer science and 18+ years in web design &development. His previous experience ranges from redesigning existing website to solving complex technical problems with object-oriented programming. Very experienced with Microsoft SQL Server, PHP and advanced JavaScript. He loves to travel and watch movies.

View More Articles

Latest Nigeria News