Wednesday, February 26, 2020 / 02:05 PM /By Ekerete Ola Gam-Ikon / Header Image Credit: Small-Bizsense
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 firstname.lastname@example.org
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