Nigeria Newspapers Online

The National Insurance Com­mission (NAICOM) has re-emphasised the need for innovative insuretech solu­tions capable mitigating the hitherto challenges posed by conventional in­surance business model.

Mr Segun Omosehin, the Commis­sioner for Insurance and Chief Exec­utive Officer at the Commission made this assertion at the 2024 IMT confer­ence organised by Modion Communi­cations over the weekend.

Omosehin who was impressed by the theme of the event: “Revitalising the Insurance Industry to Risk-Man­age Nigeria’s One-Trillion-Dollar Eco­nomic Aspiration” reiterated the vital role NAICOM has played in fostering innovative business solutions stressed: “This commitment extends to ensur­ing prompt settlement of legitimate claims, promoting market growth through innovation, and driving com­mercial value within the industry.”

In achieving this objective of revit­alising the insurance industry, the CFI pointed out that the industry players must of necessity address the funda­mental issues of Low Insurance Pene­tration; Lack of public trust and Mar­ket Fragmentation which, according to him, are plaguing the sector, among others.

“While the surge of COVID-19 raged in year 2020-2021 threatening global safety and testing the abilities, resilience and preparedness of nations globally to deal with the unexpected outbreak, the pandemic highlighted the need for digitalization.

In the insurance sector for instance, while lockdowns negatively impacted traditional distribution channels, they also encouraged insurers to de­velop digital offerings. This has come to show that investing in technology, online platforms, and mobile apps can improve customer experience and ac­cessibility” ,he said.

In addition he noted: “Essentially, revitalizing the Nigerian insurance industry to risk-manage Nigeria’s One Trillion Dollar Economy literal­ly speaks to the insurance industry’s readiness and preparedness to de-risk the activities that is projected to galvanise productivity, Innovations, economic growth and development. With the rapid changes in technology and economic/business environment, this discuss is not just timely but also topical to reawaken the need for our dear industry to rise up to the current realities of what is expected of us as an industry.”

The CFI further expressed opti­mism that with all hands on deck the industry would reap the benefits of technology in galvanizing the core fun­damentals of the sector which is the prompt settlement of genuine claims.

He stated that upon the assumption of office of the current Management, the urgent need to strategically reposi­tion the insurance industry and place high priority in certain areas that will potentially stimulate the transforma­tion agenda of the insurance sector was obvious. This, he further stated culminated to drafting a document to aid the transformation agenda of his administration.

“As a Commission, we have set out five priority areas for immediate implementation which include; – safe­guarding policyholders and improving confidence in the industry, – strengthen­ing our supervisory capabilities and or­ganizational effectiveness, – Improving safety and soundness of the Nigerian insurance industry, – fostering innova­tion and sustainability of the Nigerian insurance industry, and – enhancing overall insurance accessibility and penetration in Nigeria.

In furtherance of the need to ad­dress the fundamental question of how to attain our intended goals, we are resolved to place high priority to settle­ment of genuine claims as that is the fundamental reason of our existence as an industry. One of the enshrined and fundamental responsibilities of the Commission as a regulator is the protection of policyholders, hence the Commission prioritized prompt settlement of all genuine claims, fair treatment of policyholders and utmost transparency as some of the ways to boost insurance industry’s image and support economic growth.” He pointed out.

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Continuing, Omosehin said; “The post COVID-19 era witnessed a para­digm shift in business operations, driv­en by unprecedented disruptions that necessitated innovative adjustments to ensure continuity and resilience. This has led to the widespread adoption of AI and other emerging technologies, catalyzing fierce innovative compe­tition and impacts, product develop­ment, service delivery, distribution networks and operations. As a result, organizations are leveraging technolo­gy to drive growth, improve efficiency, and stay competitive in an increasingly complex landscape.

It is worthy to state that the increas­ing momentum of Insurtech develop­ment poses both opportunities and challenges for established industry players. To remain competitive, it is crucial that we proactively incorpo­rate innovative Insurtech solutions that will change our conventional business models, thereby safeguarding our continued relevance in addressing customer needs and market position.”

He disclosed that the Commission had since understood this reality and thus, issued the Regulatory Sandbox Guideline to accommodate the testing and refinement of innovative products. Also in place, he added, is a Director­ate for Innovation and Regulation, recognizing that change requires new approaches while the Commission has also completed a draft Insurtech Operation Guidelines which shall be released very soon.

Omosehin pointed out that the cur­rent realities of economic instability, climate change, rapid technological advancement, changing behaviour of consumers, soaring inflation and forex instability on global financial markets have disrupted ways financial services are carried out.

“Innovation and sustainability are some of the major emerging is­sues today and insurance sector must embrace innovation to meet up with the rapid market changes, changes in consumers’ preferences, tastes and lifestyle.

We must develop products that meets the demands of our market as innovation have taken the driving force in the financial services sector. More critical to the theme is the issue of financial soundness and stability of insurance institutions, as a strong financial base is key to our success as an industry.

Having sufficient capital that is com­mensurate to the Risk of an insurer has become inevitable if the industry is to meet up with the consequential ef­fect of a growing economy, managing a one trillion economy and compete with our counterparts across the globe in management of risks,” said the CFI.

He said to mitigate this, insurers must carefully manage their invest­ment portfolios, adapt pricing strate­gies, and maintain adequate reserves adding that the need to embrace digi­talization is critical and Insurers must modernise their processes, enhance customer experiences through digital channels, and invest in technology to streamline operations while adapting to changing consumer behaviours and preferences is equally important.

Speaking on the IMT 3.0, Mr Odion Aleobua, the Chief Executive Officer of Modion Communications, the con­ference organiser, said “IMt 3.0 is one of West Africa’s premier insurance events focused on the intersection of insurance and technology.

“The conferences designed to foster collaboration, innovation, and growth within the insurance industry by bringing together stakeholders, in­cluding thought leaders, regulators, insurtech innovators, investors and technology experts.”

“This year’s edition featured IMT Redefined – a youth-centric, lifestyle segment where Celebrities, Millenials, and Gen Z were given an audience to interact with the theme “Celebrating Lifestyle, Creativity and Afrobeats.”