The economic downturn in the country, has triggered huge setback to the insurance industry.
Premium revenue has gone down, though claims cost and operational expenditures have risen exorbitantly, thus taking its toll on sidelines,
The Nigeria Insurers Association (NIA), through its Chairman Eddie Efekoha, who spoke at his investiture ceremony in Lagos, said the performance of most insurance stocks on the Nigerian Stock Exchange (NSE) has been so flat that financial analysts have stopped including most insurance firms in their forecasts.
He said normally, businesses are facing greater threats principally as a result of dwindling revenues, poor infrastructure, and lack of power, inflationary trends in all sectors occasioned by the decline in the value of the naira.
He listed insecurity amongst other challenges as impediments facing insurers, adding that importation and local manufacturing are currently at low ebb.
He noted that the insurance sector was directly impacted by these disruptions, adding that these times demand internal cohesion and collaborative action. “It therefore behoves on all of us as industry players to respond quickly to the changing dynamics of the market space so that we can remain relevant and bestow a worthy legacy to the future generation of insurers,” he advised.
He said it was in the light of these developments in the local market that he decided to commit his chairmanship to address the theme-Sustainable Market Development Through Stakeholder Engagement.
He said: “Basically, all the programmes we will be executing will find space under this central theme. Very often, policy makers misunderstand insurance as an instrument for financial intermediation; it is therefore necessary to enter into constructive engagement with relevant stakeholders.
This will include the need to share knowledge with judicial officers–magistrates and judges on the workings of insurance business and to fully equip them to be able to respond adequately to the rising cases of fraudulent claims in the market, among other adjudication issues.
“We will engage with the legislators in the process of making laws that affect the economy at large and insurance industry in particular. They are major stakeholders whose support the industry would require at all times. The various bills before the National Assembly require concerted efforts to push through the industry position. It is only with the active engagement with the lawmakers that the industry can protect its business interests.
“On tax matters, we are all witnesses to the lingering issue of the heavy tax burden imposed on the insurance industry by CITA 2007. This further strengthens the need for us as an association to continually engage with the tax authorities with a view to amicably resolving all the issues and avoiding areas of future conflict.”