Wednesday, February 26, 2020 / 02:05 PM /By Ekerete Ola Gam-Ikon / Header Image Credit: Small-Bizsense
The Story
He was a senior management employee in a medium sized
insurance company and had the responsibility of managing the Human Resources
Division; however, getting accounts (customers) for the company was a duty
every employee was called to do. So, his neighbor bought a new car and our
insurance executive gladly approached the neighbor to sell comprehensive motor
insurance cover and, just like that, he got the deal. His client's car was
insured after payment and inspection had taken place. Then as was agreed by the
Company's Board, he was paid the commission being a percentage of the premium
to encourage him, and others, to do more!
Four months later, the government agency overseeing
financial crimes wrote to the insurance company to confirm that they had such a
client (policyholder) and did receive premium payment through a named bank. The
insurer promptly responded with evidence of having conducted Know Your Customer
(KYC) in line with the requirements of the law.
The agency then decided to invite the insurer to
explain why they should not be charged for abetting an infamous criminal that
was involved in car racketeering and conversion of seized cars for personal
use.
Subsequently, the insurance company was merely allowed
to go after its Management received a 3-hour lecture on KYC and committed to
the Anti-Money Laundering Regulations, which had just been introduced.
This short story I have narrated here left several
unanswered questions in my mind and I am not surprised that almost 15 years
after, the story has resurfaced in an even larger dimension, giving Nigerians
some intriguing insurance moments!
Some of My Unanswered Questions Then and Now
1. Has ignorance now become an excuse in law?
2. What exactly is KYC meant to achieve if the information obtained are not
verified before insurance cover is incepted?
3. Has the "Go and make sure this doesn't happen again" caused more harm
than good to the insurance industry?
4. Can the law indeed find the insurance company guilty of complicity in
the case of providing insurance cover for a stolen item or on the basis of
false information?
5. Who should take the punishment if the insurance company is found guilty?
The Board or the Management along with the employees that were involved in the
process?
6. What should be the role of the insurance regulator as per KYC?
7. Is the insurance industry likely to announce any reactionary steps to
ensure the public does keep the impression that insurance operators are
unprofessional?
What People Think
Matters
Currently, and as it has been for over a decade, most
Nigerians and Africans think insurance is not for them but those who have enough
money and to spare for premium payment.
They also think insurance companies are unlikely to
keep their promises from the simple delivery of contract documents to the
complex issue of claims settlement.
They think that insurance companies are only interested
in collecting premium and do little to support the community from where they
get premium.
All these and more may not be true however if nothing
is done to clear their minds, the people will continue to maintain their
thinking while the insurance companies keep struggling to deepen insurance
penetration.
In this digital age, ignoring the one who firstly
complains, then call you names, and proceeds to report you to the People's
Court, makes your day indefensible.
So long as the insurance industry continues to operate
the dictum of "let your work speak for you" in this age when the
economy is becoming more connected, what people think and say will dominate the
space.
Will the Rebranding
Project Return?
It does not matter whether the public believes in the
rebranding project of the insurance industry, in my humble view, rather it is
important and necessary that the promoters of the project display absolute
belief and conviction in it.
The Heads of Communication of insurance regulatory
bodies and insurance companies should be heard and seen explaining what they
want the public to understand and responding positively to their questions.
What you do not denounce soon gets to be believed as
true.
The insurance industry in Nigeria and Africa have done
a lot through payment of claims to keep many businesses in BUSINESS but failing
to speak about those UNSETTLED CLAIMS have marred opportunities for growth.
There is no gainsaying, insurance companies that have
excellent claims settlement records may have paid on the cases that are alleged
to be fraudulent today.
The insurance industry in Nigeria does not need such
stigma as it goes through the recapitalization process.
If our top executive in the short story above ever thought
he will have a day in the People's Court on account of trying to help boost the
income of the Company, he would go beyond just ensuring the KYC Form is filled.
Lessons have been learnt, I believe, so it is time to
unlearn and relearn for the insurance industry.
About The Author
Ekerete Olawoye Gam-Ikon, MNIM, CPP, is a management
consultant with a specialization in Strategy and Insurance. He is available
through e-mail olagamola@gmail.com
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