The consultation of market leaders before undertaken a new risk would help stem the continuos slide of premium, the Director-General Chartered Insurance Institute of Nigeria (CIIN) Kola Ahmed, has said.
He told Inspen in an interview that the absence of market leaders in the insurance industry is responsible for the fall of premium, adding that insurance business thrived in the past because risks were properly priced and that then, no business was undertaken without consulting operators who have adept knowledge on such business.
He frown at the attitude of operators who stab their colleagues, just because they want to highjack their businesses, adding that it is time for operators to go back to the era of consulting leaders before risks are undertaken.
“In the past, there is what we used to call consult the lead, no underwriter will take up any business, without knowing the history of that business, and to know the history, you need to consult the underwriter that had been handling that business, to know the issues, claims records and premium payment.
“If we can go back to that old era, whereby we will have industry leaders, the issue of the industry losing so much would be a thing of the past. For instance, where a policy that has been fetching the industry N20 billion as premium suddenly clashed to N10 billion, is a loss to the industry,” he said.
He maintained that the institution of market leaders, would help restore the sliding of insurance premium as risks will be properly priced for the wellbeing of the industry.
“In the past, we used to have market leaders in all the business classes. When you talk of marine, oil and gas and others, you know who to talk to. And if any of these companies do not quote, no other company will touch that business.
“I think we should go back to that old era, where we had distinguished market leaders and the market respect these leaders, not now when a company that just started not more than five years will want to lead a policy and expects a company that had existed for more than 20 years to follow. That is not done in civilized climes,” he added.
He said the industry can only make great progress if the operators shun unethical practices such as rate cutting, demarketing and other vices, and embrace change.