The 2024 Business Journal Annual Lecture provided a critical platform for insurance stakeholders to address the role of the industry in driving sustainable economic growth and discuss strategies for advancing Nigeria’s insurance market.
Key speakers at the event highlighted the persistent challenges faced by the sector, including low patronage, limited consumer trust, and inadequate awareness, and called for reforms to reposition the industry for growth and improved contribution to the nation’s GDP.
Legal Reforms as a Catalyst for Growth
In his keynote address, Mr. Kunle Ahmed, Chairman of the Nigerian Insurers Association (NIA), emphasized the need for legal frameworks to make insurance mandatory in Nigeria. He argued that compulsory insurance, enforced by law, could transform the industry’s narrative and significantly boost its growth.
“Insurance businesses thrive when supported by robust legal backing,” Ahmed noted. “In jurisdictions where insurance is mandatory, non-compliance attracts penalties. Unfortunately, the Nigerian insurance industry has struggled with low patronage for years, hampering its growth and contribution to GDP.”
Ahmed assured stakeholders that the National Assembly is reviewing various insurance laws to incorporate provisions that would make certain insurance policies compulsory, thereby fostering a culture of insurance among Nigerians.
Addressing Sectoral Challenges
Mr. Tope Smart, Group Chairman of NEM Insurance Plc, who chaired the lecture, acknowledged the progress made in recent years but stressed that the sector remains underdeveloped compared to global benchmarks.
“Nigeria lags behind other countries in terms of insurance penetration and growth,” Smart stated. He attributed the slow progress to key challenges such as:
Low consumer trust: Many Nigerians remain skeptical about the reliability of insurance companies.
Lack of awareness: Limited understanding of the benefits of insurance deters potential customers.
Low income levels: Many Nigerians prioritize immediate needs over long-term financial planning, making insurance a lower priority.
Smart urged stakeholders to intensify efforts to educate the public about the value of insurance and implement measures to restore trust in the sector.
A Call for Collective Action
Both Ahmed and Smart emphasized the need for collaboration among policymakers, industry players, and regulators to reposition the insurance sector. Ahmed noted that the anticipated reforms in insurance laws, once implemented, could serve as a turning point for the industry.
“The future of Nigeria’s insurance market depends on making insurance a fundamental part of our lives,” Ahmed said.
Stakeholders at the event echoed these sentiments, calling for innovative strategies to enhance penetration, improve service delivery, and ensure that insurance products are accessible and affordable for all Nigerians.
Toward a Sustainable Future
As Nigeria continues its journey toward sustainable economic growth, the insurance industry has a critical role to play. The 2024 Business Journal Annual Lecture underscored the urgent need for legal and structural reforms, alongside a concerted effort to raise awareness and rebuild consumer trust.
With the support of robust policies and increased public engagement, Nigeria’s insurance sector could unlock its potential, driving economic stability and resilience for the nation.
