Let me start by saluting fellow stakeholders in the Nigerian Project, highly distinguished leaders of the Print Media who have now been pulled-over to online publishing. A practical approach or strategy to achieving relevance, especially from the point of view of value-addition, is to follow the trend.
I am glad that the theme of this conference is: “Sustaining Growth through Diversification of the Nigerian Economy.” I have been asked to speak to whether the Nigerian Insurance Industry has been able to make contributions to this effort.
Many years ago, I was invited by the Lagos Business School (or Pan African University) to address the captains of the Nigerian Banking Industry as well as representatives of major embassies on: “Whether the Nigerian Insurance Industry can Complete the Financial Loop.” Well, the result of that short lecture today is that most retired and even practicing leaders of Nigerian Banking Industry have found their way, one way or the other to the Insurance Industry.
Insurance is the cheapest, most valuable and scientific way of indemnifying risks at the individual as well as corporate levels. Everyone, every company, every parastatal and every unit of the productive sector (in their different forms and shapes), has something to insure. As an industry, we have been striving over the years that there must be opportunity for everyone or productive unit, regardless of income or asset status, to do this. Our vision which has been propelled by innovation, has been to get Nigerians to hook-up to different tailor-made insurance.
Two years ago, in Tunis, the capital of Tunisia, a Nigerian Brand, Mutual Benefits Assurance Plc received global recognition as Africa’s Innovative Company based on its efforts in making insurance policies relevant to everyday living. For instance, Mutual Benefits developed 50 new products alongside demographic, trade groups and risks peculiar to each segment. We opened 200 business outlets across Nigeria. We have employed over 2,000 graduates to manage and operate our transportation business in Lagos State (and a few other states) in order to create value and empower fellow citizens. We have supplied over 400 members of the Airport Car Hire Association of Nigeria (ACHAN) with Toyota Camry cars. We created a scheme for Abattoir Workers Union, while befitting franchise offices were unveiled to support retired military personnel as well as experienced bankers, businessmen and other professionals. We have also been able to extend our value-adding operations to the northern states through empowerment of members of the National Union of Teachers (NUT) and Mutual’s unique “Third Party Plus Insurance Scheme.”
Our foray into providing shelter for middle-income earners was described by a national newspaper in its editorial as a “Rescue Mission” by Mutual Benefits. This effort by Mutual Benefits was in response to the call by the Federal Government for the Nigerian Insurance Industry to support government’s initiative on the provision of affordable housing.
From the above, we can see that if given its pride of place and the much-needed support, the Nigerian Insurance Industry can (and should become) the cornerstone of the on-going Economic Recovery and Growth Plan (ERGP).
Diversification as a survival strategy
As said earlier, insurance through it value-adding activities can most reassuringly foster sustainable and accelerated development and growth. It is a critical value-adding touch point in ensuring stress-free livelihood of Nigerians. It guarantees accelerated productivity and can even counter the currently exacerbating health problems. It also engenders trade through the insurance of the risks of trade finance, financial soundness and industrialization.
Investment of Insurance Funds
Genuine efforts to turnaround our economic fortunes in a sustainable manner must factor in the promotion and support of the Nigerian Insurance Industry in order to utilize its investment funds: Experts say that if you want to know how the economy of a country is doing then check out how that country’s insurance industry is doing. Our country needs, not only pension funds but also insurance funds. Our country needs large institutional funds for its development activities. Investment activities are viewed as secondary or incidental to underwriting in insurance: The nature of this business compels it to generate liabilities that must be supported by investments. Our country can tap into this through either the prescriptive or prudential models (or both). If we go aggressively for the optimal asset allocation premium, our country will be the better for it.
Nigeria must put the insurance industry on the driver’s seat for genuine sustainable growth through diversification because the industry impacts on every facet of the lives of the citizenry. Similar methods deliver similar value chains. Let us change the narrative and support the Nigerian Insurance Industry to play its pivotal and indispensable role.
Leaders at the various tiers of government and the private sector should heed the clarion call to support insurance to make it play its role. Let us take strategic positions and strike partnerships in order to solve our national problems.
Individual competitive profit, recognition and accolades cannot be compared with value-adding contribution to the system as a whole on a win-win basis. We need a unifying strategic cooperation as a country, a culture of strategic partnering with all the stakeholders who are genuinely committed to the Nigerian project to mutual value-adding support in order to ensure consistent success.
Let us all sincerely dance this very critical dance together for the good of our nation. The Nigerian Insurance Industry will not disappoint the nation.
. Being a speech delivered by Dr. Akin Ogunbiyi, the Chairman, Mutual Benefits Assurance Plc and Special Guest of Honour at the 1st Annual Conference of the Guild of Corporate Online Publishers (GOCOP) at Renaissance Hotel, Ikeja, Lagos, on August 10, 2017.