Nigerians With Access To Insurance Grow By 1.9%
The total number of Nigerians with access to insurance rose from 1.1 to 1.9%, recent statistics quoted by the National Insurance Commission had shown.
The Commissioner for Insurance, Alhaji Mohammed Kari, who stated this, said that this was not impressive enough.
He said, “According to the 2016 EFInA survey on access to financial services in Nigeria, there had been a marginal increase from 1.1 per cent to 1.9 per cent in the proportion of adults that have access to insurance.
“Two years down the line, the position has not changed much. The marginal increase notwithstanding, it is imperative to quickly note that there continues to exist a wide gulf between the number of Nigerians with access to insurance in relation to the population size of over 170 million people.”
Kari argued that the circumstance had so far inhibited the growth of the sector, coupled with wide spread ignorance on the benefits of insurance, and acute insufficiency of product differentiation which had led to cut-throat competition due to the similarity of products being offered by insurance companies.
He further noted that the insurance industry had yet to convince the majority of the Nigerian population that insurance “is a viable product, worthy of spending money on.”
He said there was a widespread lack of awareness, as “many Nigerians did not know how insurance works, how to obtain it, or why it should be bought.”
While noting that the sector was daily confronted with the challenges of low level of financial literacy, belief system, poverty, lack of trust (failure of insurance companies to settle claims), he said the combination of all of these had continued to negatively affect the penetration levels of insurance.
Kari said that the cumulative impact of the current challenges made the insurance industry transformation imperative.
Kari, however, added that the global economic crisis currently abating, provided insurers an opportunity to transform their business models and reconnect with customers by truly understanding their needs and providing value creation products and services that were relevant to their lives.