Mrs. Yetunde Ilori is the Chief Executive Officer, AXA Mansard Insurance Plc, and Chairman, Organising Committee, National Insurance Conference. She speaks with NIKE POPOOLA on major issues in the industry
How does the insurance sector intend to partner with the Federal Government in its effort to diversify the economy?
It is commendable that the present administration has made economic diversification and infrastructural development its major policy thrust by committing so much money to critical sectors such as housing, roads and power.
The insurance industry will like to complement the focus of the present administration in this direction through this national conference which will take place this month. It is a known fact that there is no genuine effort by government aimed at revamping the national economy that would be sustainable without consideration paid to the pivotal place of insurance.
It is regrettable that before now, most efforts to reposition our national economy had often left the insurance sector out of reckoning, and this is ill-advised. The insurance industry remains a critical player in the financial services sector and should be accorded its pride of place in all government programmes and policies.
Which area of the economy is the insurance industry interested in developing?
With the focus on diversification, the National Insurance Conference is looking at agriculture and other non-oil sectors. Agriculture is a major focus of the industry and we need to develop this sector. Development of infrastructure, especially construction of roads, is ongoing. It is an area that we believe we can feature very well.
In housing, there is a deficit in that area and it is an area that we are intending to partner the government. The various types of insurance that people are actually supposed to have are taken for mortgage protection; protection of assets; the welfare of the workforce that is involved, contractors’ risk; industry-wide risks.
All these are areas where we intend to partner with the government. This is because all these developments have associated risks and the associated risks, you can’t always pray for them not to happen. You have to put a process and system in place that in case it happens, it will not be the end of the project. Insurance is there to provide a means of ensuring the sustenance of our various developments.
How is the sector planning to develop agriculture?
The Nigerian Agricultural Insurance Corporation was set up by the law of the land to provide insurance cover for all the facilities that are granted by the government. Beyond that, there are other insurance companies that are providing agriculture insurance.
I must say to you that development and partnership with other agencies are ongoing because there are a lot of things to be put in place to ensure that the kind of cover we want to do is in place. Beyond fire and burglary, for example, there is the asset of the agricultural companies being covered at the moment.
We also need to be able to say that in place of drought or flood, we provide the actual cover in case of disaster experience of the sector. To do that, we need data, which right now, is not available. We are trying to partner international bodies. The reinsurers are trying to provide support as well so that the necessary measurement that we need to put in place to be able to forecast rightly the probability of occurrence of the things to be insured are well taken care of.
How is the local content law helping to retain capital in the country?
This is an area that has favoured the insurance industry as a whole in that there is a reduction to the exportation of capital in this regard. We currently have the regulator stepping in to ensure that a minimum of 70 per cent in every area of insurance is something that is retained in the country. A lot of companies are participating. Insurance industry has developed capacity to ensure that a significant proportion of these risks are retained in the country.
What should be the expectation of stakeholders in this IICC gathering?
For the industry players, it will avail us the opportunity to hear from the industry makers. We will know the direction that they are going; we know their expectation from us. It will also be an opportunity for them to hear our views. To tell them what they want that we can supply, to ensure the success of the projects that are being implemented and even after the completion; there are needs at the construction level and completion level.
Insurance is relevant because you have put something in place; you need to ensure that it is always there. So the industry players will be there to listen to the policy makers, people that have been there, operating within the various areas. For example, we are bringing the president of the farmers’ association. He will be able to tell us the position of the farmers because it is not about what we can offer them; we also need to listen to their challenges. How do we fit in? We will listen to stakeholders. It is an opportunity for them to know our constraint too. This interactive session will be of help.
Also in the area of compulsory insurances, we see people, enforcement agencies, coming together. The ones that we are not doing something significantly with at the moment will have the opportunity to significantly partner with us and they can also support us in this clime with compulsory insurances and ensure the implementation is a huge success.
Where do you see the Nigerian insurance industry in the next five years?
The conference is just one of the things that we want to use to achieve many things. So, in the next five years, I expect the contribution of insurance to have grown and also have an increase in penetration. We want to achieve a lot in terms of development and provision of jobs. We are also looking at more collaboration within the insurance industry.
What informed the recent coming together of all the arms of the insurance industry under a consultative council?
The IICC is coming together for the second time to bring all the sectors that make up insurance industry during its mega conference. It will be an opportunity for the insurance industry to come together to interact with stakeholders and key into government’s plan of expanding the natural resources and infrastructure as it moves from a mono economy that is just dependent upon oil.
The gathering will afford us the opportunity to bring everyone together under a single platform of an interactive session with the various stakeholders. We will be bringing the governments and the various practitioners in our sector.
In the last one year of coming together and cooperating under the IICC, what has the Nigerian industry been able to achieve?
The first one which was tagged mega conference in 2015 was a huge success. Before then, we were having a fragmented industry that comprised of four major constituencies. We had the Nigerian Council of Registered Insurance Brokers that was doing its own thing. The Institute of Loss Adjusters of Nigeria was doing its own; the Nigerian Insurers Association which is the umbrella body was doing its own thing; we had the Chartered Insurance Institute of Nigeria too. But everybody is now coming under one umbrella body to speak with one voice under a national event.
Since the last one year that all the sectors have been working together, has the government increased the rate at which it does insurance?
Government is the largest insurer in the industry. One major achievement that I want to draw our attention to is the bill of the insurance act that is on-going. That is one of the achievements because there was interaction between the government and our industry during the last conference. The industry had been clamouring that we need a proper framework and now the bill is on-going. We hope that the various arms of the economy will be brought to understand where their own responsibility lies in terms of insurance.
What are you focusing on?
The theme of the conference is: Expanding national resources and infrastructure in challenging times. Insurance industry will want to key in and leverage on present opportunities to deepen insurance penetration in Nigeria, and also to ensure the success of every insurance projects.
Hosting of a unified national conference by the insurance industry was the conception of the IICC as a way of projecting the Nigerian insurance industry as a united sub-sector that would attract better respect and recognition by members of the public and relevant stakeholders. I must note that with the success of the 2015 mega conference, there has been better harmonious relationship between the various constituent bodies of the industry.
The theme of the conference could not have been more timely and apt than now, when the policy direction of the present administration is towards re-building a virile national economy through diversification and expansion of national and infrastructural resources.
It has remained an irony that in spite of the nation’s past economic buoyancy, little premium was placed deliberately on building, maintaining and expanding national resources that would stand the test of time.
Is the IICC also partnering with other State Governments?
Yes; this we are doing because in terms of expanding the national resources it cuts across all governments. It is not just what the Federal Government can do alone. Where you have some of these resources lying is very important. And there is no way we can be successful without doing this. Insurance penetration cuts across the various levels and arms of the government. The state governments are very important and the local governments are not left out. All these arms are what we bring together to ensure that the contribution of insurance is higher than what we have at the moment which is less than one per cent.
What are the operators doing to support the National Insurance Commission in enforcing compulsory insurances?
The operators are not waiting for NAICOM to drive the enforcement of compulsory insurances alone. By talking about the compulsory insurances, we are going to provide the cover but there are various arms and agencies that we are supposed to work with to effect the implementation of this. That is why we are bringing together during this programme some of the agencies we know we are partnering with and that we need to partner with to ensure that we get to where the commission, our regulator is trying to take compulsory insurances to.
So the laws are there, the implementation will require a form of enforcement and we need to rely on various agencies. They include the Federal Road Safety Corps, the fire services, the police and all other relevant agencies to assist us in enforcement.
There are limited resources at our disposal to ensure enforcement but when we bring all these people together, we intend to work with them and we are already doing something with them where we partner to insure.
We are creating a database where information regarding all these things can be captured. We work with the bank as well so that as people are going through them to obtain facility to bring in one thing or the other, the right kind of insurance is put in place.