Innovation Village had an interview with the Group Managing Director/CEO of Cornerstone Insurance, Mr Ganiyu Musa. This is what he had to say about the economy and the insurance industry in general.
Innovation Village (IV): What is your opinion on the outlook for the Insurance Business in Nigeria this year?
Ganiyu Musa (GM):
- Considering the frail economic activities, insurance premium is likely to witness a slow growth in 2016. However, we expect a premium growth in the medium term on account of federal government been able to pay its outstanding debt of over N10billion to the insurance companies. Though, this could be impacted by the frail economic activities stemming from the ongoing rout in crude oil prices and its effect on the economy
- Federal Government promise on job creation would also boost the premium income from Life business
- Innovation through technology would remain tool for driving the microinsurance
- Potential for Takaful in Nigeria is strong, with roughly half the population being Muslim representing a client base of more than 80million and, based on trends in other countries, Islamic Insurance products also appeal to non-Muslims
- Potential growth in retail segments through the implementation of the bancassurance model
- Potential for increasing middle-class populace expected to increase consumer spending, vehicle ownership and home ownership
IV: Do you think the depreciating Naira will affect the average Nigerian’s disposition to the Insurance business?
GM: The impact of Naira Devaluation is likely to impact the disposable income of the populace in the short term, thereby disposition to insurance could affect insurance offerings not compulsory by Law. A future rise in the oil price as projected for future is expected to normalise this effect.
IV: Over the years, do you think the average Nigerian’s attitude to the Insurance Business has changed or is changing?
GM: As a result of the recent industry reforms introduced in the last few years, Nigerians attitude to Insurance business has improved, coupled with strategic partnerships with Nigeria Telcos in attracting more retail market into the insurance space. For instance, the enforcement of the “No premium, No cover” policy, and introduction of Takaful, Bancassurance and micro insurance have triggered a significant impact in insurance business in Nigeria.
IV: What innovative initiatives has Cornerstone Insurance recently introduced to endear Nigerians to Insurance?
GM: In recent years, Cornerstone has introduced the following initiatives to increase insurance penetration:
- Strategic partnership with Airtel Nigeria to further deepen Insurance penetration in Nigeria
- Revamping of our online platform to improve product distribution and provide an end-to-end claims processing for our customers, brokers, etc.
- Increased awareness of Insurance products and services through our radio talk show programmes for Nigerians
- Introduction of our Gadget Protection Plan (GPP) to protect devices and gadgets used and owned by Nigerians
- Continued partnership with corporate organizations, associations, etc. to provide various educative and awareness programme
IV: What are the key factors that should help in promoting the business of Insurance in Nigeria?
- Review of the current Tax law as relating to insurance business; thereby considering the nature of the business, the embedded risk and claims to determine appropriate tax system for insurance companies.
- Insurance Operators to maintain price discipline to deal with rate-cutting issues
- Improved compliances to regulation and guidelines
- Joint intensive awareness campaign among Operators to educate the masses on benefits of insurance via Media Relations, Radio, TV, Prints Publication
- Partnership with banks and other financial sectors on the ongoing financial inclusion and literacy programmes to drive insurance literacy and awareness