‘Trust God’ mentality is slowing growth in Nigerian insurance sector – Olamerun
The Vice-President of the Pan-African Insurance Organization, Gbadebo Olamerun, addresses TEMITOPE ADETUNJI on the fortunes of the insurance industry in Nigeria and the African continent
Why should the common man believe in the Nigerian insurance industry?
In other climates where things are working properly, the insurance industry is the backbone that guarantees the sustenance of individuals, government and industries. There is something to fall back on. I mean life is full of ups and downs. There was never an up or down throughout, except there is a spiritual undertone. The insurance industry brings a lot of relief and reduces the waste that we all have as a country. Unfortunately, the insurance sector has a penetration of less than 2% in Nigeria. The most interesting part is that the insurance is owned and managed by practitioners in Nigeria, just as it is in other climates. And along the same lines, insurance practitioners hold significant stakes in other financial institutions. Unfortunately, the reverse is happening here. Players in the banking sector are gradually taking large shares in the insurance sector. We insurance industry practitioners need to put up more than our A game to take our rightful stance. I can imagine that I have a child who is only three years old; and I’m sure deep down that when he’s 19 or 21, when he gets to college, his education is guaranteed. The insurance industry brings a lot of equity into this trajectory. Unlike I save, if I can’t save when my child is 21, my child is alone.
Why don’t most Nigerians trust the insurance industry?
The insurance industry has a lot of work to do. We have a lot of work to do and little by little the narrative is changing. You will be shocked that the industry paid hundreds of millions of dollars for the destruction of EndSARS. You will also be shocked that the insurance industry has come together as a brand to support the federal government during the COVID-19 pandemic. Glad to say that over the years the insurance industry has always provided service. But the service gets us nowhere. Currently, with the harvest of industry leaders, the industry is coming up with solutions. So I’m not just waiting for your car to have an accident for me to cover you; I also think that since you come from university, I have a financial organization that can help you get a car and insure it and you spread the payment over time. My father used to tell me that when he left school, there were organizations courting him to work with them. In fact, he said he was in a dilemma about which organization to choose. We no longer enjoy such privileges today. The insurance industry brings this on the value. You want to build a house, we don’t wait for you to buy to be able to insure you; we partner with you to provide help and partnership to buy the home while we insure it. I’m glad the industry is taking a giant step to demystify what has been the challenge.
To what extent are these new approaches actually feasible?
Absolutely passable. I don’t want to name any brands. But a good number of insurance companies make valuable numbers. The insurance industry has realized that paying claims as they occur is vital to improving the industry. That President Muhammadu Buhari warmly commends the insurance industry for the role it played during the EndSARS outbreak and the COVID-19 pandemic shows the unprecedented success the industry has achieved.
Can you detail the industry response to the #EndSARS protest?
Many of the buildings and cars burned during the protest were uninsured. Some of them who were insured were not included in the exclusions that happened to them. If you insure your car, war is exclusion. If you want your car included in your policy, you purchase this exclusion in your policy. If you want the riot (that’s another exclusion) included, you buy it. If, ab initio, you have taken out an all-in-one policy, you are covered. The industry has been put on notice, which is gratis law, and has raised funds to compensate all those challenged. So whether you are notified or not, we have compensated them once they have been insured.
What is the biggest challenge facing the insurance industry in Nigeria?
Knowledge gap. There is a tradition that we Nigerians think that Jesus and Muhammad are their assurance. It’s true that Jesus and Muhammad are our assurances, but we have to do what is necessary. If my car is worth N20,000, then it is important to have a plan B. This plan B is insurance. I would like to sincerely thank the government of President Buhari. He has, up to a certain level, been cooperative.
How has Buhari helped the insurance industry?
As president, your body language says it all. I’m going to give you an example. We have had an advisory forum for four years and I have just returned from Kenya. The entire insurance industry in Africa was in Kenya. The president was not there but he sent his representative but in Nigeria the president came in person.
What impact are the current economic realities in Nigeria having on the insurance industry?
The clues are clear and I am not here to dispute them. Business since 2015 has been extremely difficult. The number one problem is insecurity. The problem of insecurity has brought the whole economy to its knees. It’s a shame that the citizen’s number convoy was attacked. It is the height. I was analyzing the economy a few days ago. The numbers don’t smile. Arrows in almost all sectors are down. Seriously speaking, it’s a pain that is absolutely unbearable. Education, aviation, telecommunications, name the sector, the economy is under severe pressure. The Nigerian economy is truly contested.
What do you remember from the AIO event in Kenya?
It was a gathering of the entire insurance industry in Africa. It is the largest organization in Africa that brings together all major players in the insurance industry in one room. The event takes place once a year, where each country that is a member country welcomes other members. We deliberate and deliver policies and initiatives to empower the industry and further increase penetration in Africa. The African Insurance Organization has existed since 1976. We celebrated our 50th anniversary. And I am privileged alongside four other African countries – Kenya, South Africa, Burundi and Mozambique – who came together to push this narrative to the OAA during the general assembly that the Organization of the Pan African Insurance Agency should be incorporated as a full member of AIO. AIO. Before, it was AIO. AIO includes underwriting companies, reinsurance companies, brokers, actuaries. Now, insurance agents have been integrated into OAA. This is a first of its kind and I have the privilege of being elected vice-president of the Pan-African Insurance Organization.
How important is your position in the Pan African Insurance Organization to Nigeria?
It is above all a continental mission. This is not a Nigerian mission. Our main objective is to increase insurance penetration in Africa. The same narrative that affects Nigeria with 2% penetration is also almost the same for some African countries in the same trajectory. Several other African countries are on the same trajectory. We only have three out of four countries that have a penetration rate above 3%. We also have a responsibility to increase insurance penetration in Africa. We must also coordinate a level of professionalism and education of our members. We have a responsibility to negotiate with states, countries and regions to see how the role of insurance can be deepened. The President and I have scheduled several meetings across Africa. The president is from Kenya. The vice president comes from Nigeria. The general secretary comes from South Africa.
What is the purpose of New Narrative Foundation what are you running?
The foundation is, as the name suggests, to put an end to allowing anyone to drive the affairs of Nigeria. For us as an organization, we are beginning to empower and educate more educated Nigerians. What is our definition of educated Nigerians? For us, if you hold an NCE, OND, HND, University degree, Masters degree in any field, you are an educated Nigerian. We are building clusters here and there to make sure we get all our PVCs, start educating on the electoral value that the Nigerian economy brings to the table; start empowering young people on the true color of the future, the $5,000, $2,000 trajectory will get us nowhere. In our context, we are not so concerned with local government. We think to fight it from above. Who should be the President of the Federal Republic of Nigeria? Does he have the means to manage the resources? What does his body language say? Does the person have the integrity to govern us? Can he provide the least of the least – good roads, electricity, hospitality.
It’s crazy that whenever one of our top guys here gets malaria, the next thing to do is travel overseas. We want to know who has this track record? Who has the capacity to help Nigerians? It’s crazy to say that any country you travel to, Nigerians run the majority of sectors in that country. Name it – USA, UK, even Russia waging war. Check all major stakeholders in these countries, they are Nigerians. We need this leader who can give us an atmosphere of security, hope and prosperity.
Do you think we currently have a leader who can take us there?
My ideology in life is to live every day every time. You don’t live tomorrow before today. There are people who are equally competent to lead and govern Nigeria as a country. Please note that we are not aiming for 2023; we are looking at the next 12 years. We are taking our time to train and attract the Class A of citizens who understand what we are doing and are starting to gradually push the narrative and see how to put the Nigerian economy back in the hands of those who can take us to the Promised Land.