Sunday, January 27,
2019 12.47AM / OpEd By Ekerete Ola
Gam-Ikon*
When in the next generation, companies consider requesting their
customers to vote for persons who should be their CEOs, it will be most
interesting to see how policyholders decide the CEOs for their insurance
companies in Nigeria. Depending on how you treat your insurance policy (if you
have one), you should be interested in changes at the C-level of an insurance
company as you would be in that of a bank or any financial institution. Your
insurance policy is an investment for the rainy day, so why would you not be
keen to know those managing it, before something goes amiss?
Having met too many serious-minded executives who buy insurance from
marketing executives of insurance companies and brokerage firms as well as
tied-agents and facilitators, only to end up knowing little or nothing about
their insurance companies when a claim occurs, I thought it was essential to
share some useful information about the changes that have taken place at the
leadership level of some insurance companies that could impact our position as
policyholders.
Why You Should Elect to Know
As the year progresses and we make commitments to our financial plans,
it is imperative to be assured that the avenues we have chosen will, indeed,
enable us reach our targets at the end of this financial year and maintain our
net worth if it cannot be boosted.
May be I should start by reminding us that with the botched effort of
late last year by the regulator, National Insurance Commission (NAICOM), to
increase capital and have insurers accept only risks that they can handle,
policyholders are even more exposed to the manipulations of weaker companies
that are eager to collect premium yet unable to honour their obligations.
Like in every industry, there are fringe players and one would
understand why NAICOM considered the classifications into tiers which was based
on the total equity of the insurance companies but with the failure to
implement that guideline, the companies that had lost hope and become afraid of
unplanned acquisition or liquidation on account of outstanding obligations like
unsettled claims amongst other misdemeanors are back on the road, quite sadly,
in the same condition, if not worse.
Policyholders especially those who have Life policies should be even
more concerned and should know the right questions to ask now, which is why it
is also good to know who to ask those questions in the companies where
appointments have been made. Till date, we have a number of policyholders whose
claims remain unsettled by evidently weak insurance companies and NAICOM is
understandably set to determine such cases even if it means using their
statutory deposits.
It is important to note that the reasons for these changes in leadership
range from seeking to strengthen the management to replacing those incapable of
leading the survival strategies of such companies, and we are bound to see more
changes where new investors have emerged while in very few cases, retirement
shall be the reason.
Talking about retirement, one is reminded about the botched attempt at
implementing the Code of Good Corporate Governance for the insurance industry
which would have seen many of today’s CEO replaced. With the recent release of
the Code of Corporate Governance by the Financing Reporting Council of Nigeria
(FRC), it is expected that some more changes will occur.
What to Expect
Considering that these insurance companies are at different stages of
their corporate development and would be competing against others where the
CEOs have enjoyed more years in their positions, these appointees are expected
to perform beyond reasonable benchmarks with respect to customer experience,
technology adoption, recapitalization, product innovation, claims management,
digitalization, data analytics and brand reactivation.
By effectively addressing these issues, these CEOs will most likely
operate in such a way that NAICOM will be excited to relaunch its “CEO of the
Year Award” in its efforts to heighten public interest and acceptance of the
insurance industry.
Importantly, a number of them have inherited promises made by their
predecessors which they will desire to review and yet execute in order not to
incur the wrath of the beneficiaries of such promises especially policyholders
with unsettled claims, employees with unpaid salaries/allowances,
brokers/agents with unpaid commissions and contractors with unpaid fees. They
are not expected to complain but get results that will improve the rating of
their companies in the market.
For those who have less of the aforementioned issues, they will be
expected to stretch the current boundaries of insurance and develop solutions
to emergent risks like cyber, climate change and credit while pushing forward
to win accounts that will increase their top-line to justify the level of
shareholders’ funds.
The combined efforts of these CEOs could create about 200% increase on
the industry-wide Gross Premium Written and provide the basis upon which NAICOM
can hope to attain its N1trillion target by 2020. Given NAICOM’s recent
admonition of insurance companies on rate cutting, these CEOs might be the
change makers it needs to complete some of its regulatory initiatives.
These CEOs can be challenged to look critically at the adoption of intelligent
technology in Nigeria’s insurance industry along with emerging insurance
technology (insurtech) start-ups to enable an improved customer experience for
policyholders. They should look beyond their companies and pay some more
attention to providing risk management solutions that addresses the needs of
citizens and deepen their social participation in engaging one other. Ongoing
discourse on health insurance should interest these CEOs because we expect the
deployment of insurance technology (insurtech) in this respect to provide
learning opportunities for them.
Moreover, greater opportunities exist for leveraging insurance on
activated platforms for economic recovery and growth boosted by regulatory
actions in related sectors like banking, payment systems, cooperatives,
mortgages and entrepreneurship.
Selected Appointments to Note
Before and within 2018 (that year of somersaults in the insurance industry), some insurance companies made the following C-level appointments:
There you have it. These C-level officers have the responsibility, more
than others before them, to steer the affairs of their respective companies and
by implication, the future of the insurance industry in Nigeria on to the path
of transformation.
Let’s look
forward to the brighter side of the year even in this season of elections!
About The
Author
Ekerete
Olawoye Gam-Ikon, MNIM, CPP is a management consultant with
specialization in Strategy and Insurance. He can be reached vide telephone on
+234-806-648-1111 and +234-802-585-0344 or by e-mail vide olagamola@gmail.com
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