By Naomi Uzor
The Lagos Chamber of Commerce and Industry, LCCI, has said the role of the insurance sector in the growth and development of the economy represents the backbone of risk management systems but that performance indicators of the insurance sector in Nigeria are still below average and contributes less than 1 per cent to the Gross Domestic Product (GDP).
Disclosing this at the inauguration of the Insurance Group of the LCCI, the President of LCCI, Chief Nike Akande, said the insurance sector serves as an important component in the financial intermediation chain and offers a ready source of long term capital for private and public sector projects but despite these critical roles, most recent statistics reveals that the contribution of insurance sector to GDP is less than 1 per cent, there is near-zero informal sector penetration, less than 1 per cent of Nigerians have life insurance and insurance density still stands at 0.225 per cent. “You will agree with me that given the above challenges, the decision of the chamber to form this group is timely. The group is expected to play a strategic role in advancing possibilities in the sector through market innovation, better technology, improved business strategies, micro-insurance/informal sector opportunities, increased awareness, investment, value creation and employment generation. I implore you all to take advantage of this opportunity to promote the growth of the insurance sector and enhance the prosperity of your individual businesses” she said.
The Chairman of the Insurance Trade Group, LCCI, Mr. Gboyega Olanbiwoninu, said as at July 2015, insurance penetration in Nigeria stood at 0.6 per cent compared to neighbouring African countries like South Africa, Namibia and Kenya which have 15.4 per cent, 7.7 per cent, and 3.4 per cent respectively, adding that, there is need for this trend to be reversed. “I realise that the task ahead of me is herculean, however I shall continually count on the support of the management of the chamber and other operators in pursuing ingenious, innovative and channel development strategies to expand membership of the group and create value for its insurance operators.
My belief is that people would naturally gravitate to where they could get value and this would be our strategic thrust. Also, we shall, under my leadership focus on strategic alliances with government vis a vis advisory services on insurance solutions,” he stated.