How Businesses Can Manage Their Risks In A Time of Uncertainty

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Monday, February 22, 2021 / 08:00AM / Ottoabasi ABASIEKONG for WebTV / Header Image Credit: Coronation Capital

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"The Business Environment requires business owners to pay close attention to the wide range of risks that could impact their organization." This was the assertion of Mr. Seyon Thomas, Head of Enterprise Management at Coronation Insurance Plc during a webinar, which had as its theme 'Managing Business Risks at a Time of Uncertainty'.


Speaking at the Coronation Insurance Plc Webinar in Partnership with Access Bank Plc, the Deputy Group Managing Director of Access Bank, Mr. Roosevelt Ogbonna in his opening address stated that the partnership between Access Bank and Coronation will bring the best in banking and insurance services, which is referred to as a 'Bancassurance Scheme'.  


In fulfillment of the bank's promise to be more than a bank, Mr. Ogbonna believes that its banking customers will experience the best in underwriting and claims experience. He mentioned that the partnership with Coronation Insurance Plc is attributed to the speed of response, level of customer service, financial strength, and the capitalization of the institution.


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Mr. Roosevelt Ogbonna further stated that the synergy between Access Bank and Coronation will set new standards for quality service delivery within the insurance industry and elevate the level of insurance service that is delivered to SMEs and MSMEs through the bancassurance scheme.


According to Mr. Taiwo Adeoye, Technical Advisor to the Commissioner of Insurance (NAICOM), who represented the Commissioner of Insurance, Mr. Sunday Thomas, "whatsoever affects our external environment, affects our business. Due to the consequences of COVID-19, the economy and businesses have been vulnerable". This implies that new and small businesses need to make effort to transfer their risks to protect themselves from uncertainties.


Mr. Taiwo Adeoye further explained that though businesses are considering cost reduction mechanisms, it is important to ensure that the assets used to generate revenue for the business is adequately insured in order to prevent total loss should any unforeseen incident occur. He added that businesses should have a good risk management framework.


On his part, Dr. Femi Oyetunji, Managing Director, Continental Reinsurance Plc provided insight into how businesses can manage risks amidst the challenges of the pandemic and other socio-economic issues. According to him, businesses can treat risk by accepting it, transferring it, reducing it or avoiding same. He also explained that the top SME Business risks are the keyman risks, currency risks, regulatory risk, property damage, business interruption, reputational risk, supply chain, cyber risks and fraud, while addressing the various mitigation techniques that can be used to reduce and transfer the risk.


Mr. Omotayo Gbede, Managing Partner, Crown & Lords (Chartered Accountants) in his intervention spoke on how inflation could impact businesses and measures that should be taken to safeguard their organizations. He highlighted that some of the causes of inflation are fiscal and monetary policies including high taxation and budget deficit, rising food and prices due to pandemic and adverse weather conditions, rising fuel prices, rising energy costs, worsening exchange rate, poor logistics and supply chain and the high cost of borrowing.


He mentioned that inflation has a major impact on businesses especially the small-size ones who may not be well equipped to cope with such phenomenon. According to him, it also affects the value of money and acts as a disincentive to savings since the value declines over time.


Mr. Omotayo Gbede also gave his perspective on how SMEs can cope with inflation, he stated that SMEs should prepare for inflation and take proactive rather than reactive steps,  by reducing their level of debt, carry out gradual price adjustments to offset the impact of inflation, effectively manage their supply chain by carefully scrutinizing the prices charged by suppliers and look for better deals in terms of price, quantity, quality as well as conditions for supply and payment.


According to him, businesses should avoid steps that can devalue their brand. He maintained that keeping your brand equity is very critical while coping with Inflation.


In all, it is expected that the Bancassurance partnership between Access Bank Plc and Coronation Insurance Plc will enable businesses leverage on the expertise of both institutions for their banking and insurance needs.


Watch the FULL Video HERE

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Proshare Nigeria Pvt. Ltd.

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