In this interview with NIKE POPOOLA, the Managing Director/Chief Executive Officer, Equity Assurance Plc, Mr. Moruf Apampa, speaks on developments in the Nigerian insurance industry
How has the insurance sector fared this year?
The insurance industry is an integral part of the Nigerian economy and has therefore had to cope with the economic downturn and prevailing headwinds within the operating environment.
However, it is important to note the positive developments and improvements in the areas of regulatory supervision, customer protection and enforcement by government agencies such as the National Insurance Commission.
There is increased market discipline in operators and other stakeholders. This is a great improvement when compared to the unethical market practices of previous years.
Furthermore, in spite of the tough economic conditions, one would observe that operators have intensified the development of service capabilities and the capacity to meet changing customer demands.
Mergers and acquisitions with established multinational insurance brands, for instance, have become an attractive route to growth and competitiveness among local operators.
There is greater focus and protection of customer rights as well as increased spending on marketing and public awareness by both the regulators and insurance operators.
Overall, despite significant challenges largely related to the economic recession, the insurance industry has strengthened some very important building blocks and better positioned to unlock the immense market opportunities in the near term.
What are the reasons for low insurance development?
Consumer apathy on the need for insurance is not far-fetched. There is a longstanding lack of trust between the subscribing public and insurance companies and inadequate awareness campaign to enlighten the public on the benefits of taking policies.
Insurance providers have improved service standards significantly, paying claims of several billions year after year and increasingly on a timely basis. It is important that we make the case and educate the public on the positive strides of progress that have been achieved especially in recent years.
Furthermore, there simply are not enough professionals and intermediaries to service our large population.
Other factors include poverty, low literacy level, religion, traditional culture or norms, ignorance, and absence of infrastructure. There is also need to build insurance capacity – building centres whereby professionals and the public in general can access technical and continuous professional development, peer review opportunities and innovation.
Are insurance companies really benefiting from the local content initiative of the Federal Government?
Yes, the local content initiative has had a tremendous positive impact on the operations of insurance companies as well as other stakeholders across the insurance value chain.
Since the policy took effect, there has been a steady rise in the underwriting capacity and financial strength of indigenous insurance providers due to the incentives to retain and underwrite more risk. This helps to develop local expertise, retain profits and accelerate growth of Nigerian insurance operators.
How can the compulsory insurance policies be better enforced?
The responsibility of enforcement rests squarely with the respective government agencies as provided by law. As you are aware, there are challenges regarding identity verification and infrastructure deficits which make the task of enforcement a lot more onerous.
In recent years, however, we have seen significant progress especially in the enforcement of compulsory classes of insurance such as third-party auto insurance, group life insurance, public liability insurance, etc.
It has to be said too that the counterpart responsibility of compliance rest with the general public, businesses, families and households. It is in our collective interest to comply and take the relevant compulsory insurance for our own benefit.
There has been an influx of foreign investors in the country. What impact do you see this having on the insurance industry?
Due to the immense business potential of the Nigerian insurance market, the number of foreign investors and strategic operators that have either entered or shown interest in the Nigerian insurance market in the past couple of years continue to increase.
There are both business and strategic reasons why Nigeria is an attractive market to foreign investors. Over a dozen new foreign entrants have either merged or partnered with local insurance operators and this trend will likely continue.
The impact and ramifications are positive and are increasingly becoming evident. We have seen strong collaborations and knowledge transfers in the areas of technology solutions, branding, research, product development, and customer service.
The SUNU Group recently bought and rebranded Equity Assurance. What led to this acquisition?
SUNU Group is a foremost Pan-African Insurance group with presence in 14 countries, mostly in francophone and central Africa. In line with its growth and service objectives, SUNU wanted to establish its footprint in the Nigerian market in order to help unlock the opportunities and provide Nigerians with well-tested and proved insurance solutions.
Due to strong alignment in values and business aspirations, Equity Assurance found a natural synergy in this partnership which has already begun to deliver the intended goals of service excellence, innovation and growth.
What should the public expect from SUNU Equity, the new brand?
Like Equity, SUNU Group’s core values of professionalism, customer-centricity and respect for the individual are fundamental to its business operations and conduct.
These values are what make SUNU Group either the clear leader or a close second in all the markets where we are present – 22 locations across 14 countries in West and Central Africa. SUNU Group’s remarkable growth/expansion credential is even more impressive when one realises that it was achieved in less than 20 years.
As with all of its member companies, Equity Assurance Plc. will have access to the SUNU Group’s operations hub (located in Cote d’ivoire) which provides both technical and business support services including specialty functions such as product development, actuarial services, technology and branding.
Nigerians will enjoy fresh, innovative insurance products and solutions as we leverage the vast knowledge capital, partner network and expertise that have over the years been garnered across our various locations.
In addition, Equity will continue to benchmark and align with the best-practice standards of the group, as well as entrench leading corporate governance structures and culture for its Nigerian business operations.
As the chief executive officer, what are your management ideas?
My vision is to revolutionise Equity Assurance into a high-performance service organisation with a competitive advantage anchored on its ability to innovate and execute solutions that best address all extant challenges facing insurance customers in Nigeria.
In simpler terms, our plan is to be the customers’ preference and create a sustainable competitive advantage while leaving sufficient money on the table for shareholders.
At Equity Assurance, we are assiduously building execution capacity and implementation competencies while adopting a phased (short, medium and long-term) approach to our transformation journey. We will continue to improve our key processes and approaches in strategy development, talent management and operations design and implementation.
What is the role of technology in driving insurance growth?
Technology is at the core of every conversation in the financial ecosystem as they look to optimise and transform their business operations. The immense influence of digital technology in our everyday life cannot be overemphasised.
Varieties of breakthrough technologies are currently being utilised and are set to spur a fundamental transformation of the insurance industry in the near future.
Cloud computing, the Internet of Things, advanced analytics, telematics, the global positioning system , mobile phones, digital platforms, drones, blockchain, smart contracts, and artificial intelligence are providing new ways to measure, control, and price risk, engage with customers, reduce cost, improve efficiency, and expand insurability.
These technologies are also enabling the creation of new insurance products, services, and business models.
While emerging technologies provide opportunities for traditional insurers to modernise and reinvent themselves, they also force them to respond to new sources of competition from increasingly well-funded and nimble software-based companies that are beginning to make inroads in the market by focusing on unmet consumer demand, bringing down costs, and providing new services.
How does Sunu Equity plan to enhance insurance growth with the third party mobile insurance?
Our USSD (Unstructured Supplementary Service Data) mobile solution is an unprecedented technological initiative in the 100 years of Nigeria’s insurance market.
It is a simple self-service solution that enables car owners/users to purchase authentic third party auto insurance with the use of their mobile phones in less than five minutes. It does not matter whether the phone is a smartphone or a basic phone.
Furthermore, the service is accessible without internet/data bundle and can be used on all the GSM networks. This mobile solution is an example of the disruptive, problem-solving innovations Nigerians have been yearning for.
The key benefits are speed and convenience; customers get their e-certificate in five minutes or less, as well as an automated upload of their insurance details onto the Nigerian Insurance Industry Database.
We are well aware of the government’s drive towards achieving financial inclusion across the country. The Equity Mobile Insurance solution is designed to further this objective as it is available to everyone, regardless of their GSM network, type of phone or whether or not they have access to the internet.
Are you planning to introduce new products?
It is important to note that the Equity (USSD) Mobile Insurance is a scalable and flexible solution. We have started with the launch of the third party auto insurance because it is simple and is the most frequently demanded insurance product in Nigeria.
In the near future, we will deploy and roll-out other products and solutions that are in high demand across our target segments.
We have invested in world-class operating systems and call-centre infrastructure to ensure real-time, online customer support, claims administration and other after-purchase services.
What do you feel Nigerian insurers are yet to get right to enhance the sector’s growth?
The long-standing challenges of low awareness, poor enforcement, customer apathy and poverty continue to impede insurance penetration and growth in Nigeria.
Insurance operators, alongside related associations such as the Nigerian Insurance Association and the Nigerian Council of Registered Insurance Brokers, need to collaborate more and intensify efforts to raise awareness of the innumerable economic benefits and social impact of insurance on personal, business and public life.
Furthermore, enforcement (especially of compulsory insurances i.e. the Market Development and Restructuring Initiative) by government agencies needs to be improved.
Insurance operators need to collaborate better with other stakeholders (within and outside the industry) to develop flexible pocket-friendly insurance products to cater for the less privileged and under-served segments of the market who have little to no disposable income.
What advice do you have for the insuring public on insurance?
Choose a life without worries; get insured today.
What are the prospects of the Nigerian insurance sector in the years ahead?
At Equity Assurance, we look forward to the future with confidence and zest. We all have the opportunity to help build the Nigerian insurance industry of our dream.
In this article:
How has the insurance sector fared this year?
The insurance industry is an integral part of the Nigerian economy and has therefore had to cope with the economic downturn and prevailing headwinds within the operating environment.
However, it is important to note the positive developments and improvements in the areas of regulatory supervision, customer protection and enforcement by government agencies such as the National Insurance Commission.
There is increased market discipline in operators and other stakeholders. This is a great improvement when compared to the unethical market practices of previous years.
Furthermore, in spite of the tough economic conditions, one would observe that operators have intensified the development of service capabilities and the capacity to meet changing customer demands.
Mergers and acquisitions with established multinational insurance brands, for instance, have become an attractive route to growth and competitiveness among local operators.
There is greater focus and protection of customer rights as well as increased spending on marketing and public awareness by both the regulators and insurance operators.
Overall, despite significant challenges largely related to the economic recession, the insurance industry has strengthened some very important building blocks and better positioned to unlock the immense market opportunities in the near term.
What are the reasons for low insurance development?
Consumer apathy on the need for insurance is not far-fetched. There is a longstanding lack of trust between the subscribing public and insurance companies and inadequate awareness campaign to enlighten the public on the benefits of taking policies.
Insurance providers have improved service standards significantly, paying claims of several billions year after year and increasingly on a timely basis. It is important that we make the case and educate the public on the positive strides of progress that have been achieved especially in recent years.
Furthermore, there simply are not enough professionals and intermediaries to service our large population.
Other factors include poverty, low literacy level, religion, traditional culture or norms, ignorance, and absence of infrastructure. There is also need to build insurance capacity – building centres whereby professionals and the public in general can access technical and continuous professional development, peer review opportunities and innovation.
Are insurance companies really benefiting from the local content initiative of the Federal Government?
Yes, the local content initiative has had a tremendous positive impact on the operations of insurance companies as well as other stakeholders across the insurance value chain.
Since the policy took effect, there has been a steady rise in the underwriting capacity and financial strength of indigenous insurance providers due to the incentives to retain and underwrite more risk. This helps to develop local expertise, retain profits and accelerate growth of Nigerian insurance operators.
How can the compulsory insurance policies be better enforced?
The responsibility of enforcement rests squarely with the respective government agencies as provided by law. As you are aware, there are challenges regarding identity verification and infrastructure deficits which make the task of enforcement a lot more onerous.
In recent years, however, we have seen significant progress especially in the enforcement of compulsory classes of insurance such as third-party auto insurance, group life insurance, public liability insurance, etc.
It has to be said too that the counterpart responsibility of compliance rest with the general public, businesses, families and households. It is in our collective interest to comply and take the relevant compulsory insurance for our own benefit.
There has been an influx of foreign investors in the country. What impact do you see this having on the insurance industry?
Due to the immense business potential of the Nigerian insurance market, the number of foreign investors and strategic operators that have either entered or shown interest in the Nigerian insurance market in the past couple of years continue to increase.
There are both business and strategic reasons why Nigeria is an attractive market to foreign investors. Over a dozen new foreign entrants have either merged or partnered with local insurance operators and this trend will likely continue.
The impact and ramifications are positive and are increasingly becoming evident. We have seen strong collaborations and knowledge transfers in the areas of technology solutions, branding, research, product development, and customer service.
The SUNU Group recently bought and rebranded Equity Assurance. What led to this acquisition?
SUNU Group is a foremost Pan-African Insurance group with presence in 14 countries, mostly in francophone and central Africa. In line with its growth and service objectives, SUNU wanted to establish its footprint in the Nigerian market in order to help unlock the opportunities and provide Nigerians with well-tested and proved insurance solutions.
Due to strong alignment in values and business aspirations, Equity Assurance found a natural synergy in this partnership which has already begun to deliver the intended goals of service excellence, innovation and growth.
What should the public expect from SUNU Equity, the new brand?
Like Equity, SUNU Group’s core values of professionalism, customer-centricity and respect for the individual are fundamental to its business operations and conduct.
These values are what make SUNU Group either the clear leader or a close second in all the markets where we are present – 22 locations across 14 countries in West and Central Africa. SUNU Group’s remarkable growth/expansion credential is even more impressive when one realises that it was achieved in less than 20 years.
As with all of its member companies, Equity Assurance Plc. will have access to the SUNU Group’s operations hub (located in Cote d’ivoire) which provides both technical and business support services including specialty functions such as product development, actuarial services, technology and branding.
Nigerians will enjoy fresh, innovative insurance products and solutions as we leverage the vast knowledge capital, partner network and expertise that have over the years been garnered across our various locations.
In addition, Equity will continue to benchmark and align with the best-practice standards of the group, as well as entrench leading corporate governance structures and culture for its Nigerian business operations.
As the chief executive officer, what are your management ideas?
My vision is to revolutionise Equity Assurance into a high-performance service organisation with a competitive advantage anchored on its ability to innovate and execute solutions that best address all extant challenges facing insurance customers in Nigeria.
In simpler terms, our plan is to be the customers’ preference and create a sustainable competitive advantage while leaving sufficient money on the table for shareholders.
At Equity Assurance, we are assiduously building execution capacity and implementation competencies while adopting a phased (short, medium and long-term) approach to our transformation journey. We will continue to improve our key processes and approaches in strategy development, talent management and operations design and implementation.
What is the role of technology in driving insurance growth?
Technology is at the core of every conversation in the financial ecosystem as they look to optimise and transform their business operations. The immense influence of digital technology in our everyday life cannot be overemphasised.
Varieties of breakthrough technologies are currently being utilised and are set to spur a fundamental transformation of the insurance industry in the near future.
Cloud computing, the Internet of Things, advanced analytics, telematics, the global positioning system , mobile phones, digital platforms, drones, blockchain, smart contracts, and artificial intelligence are providing new ways to measure, control, and price risk, engage with customers, reduce cost, improve efficiency, and expand insurability.
These technologies are also enabling the creation of new insurance products, services, and business models.
While emerging technologies provide opportunities for traditional insurers to modernise and reinvent themselves, they also force them to respond to new sources of competition from increasingly well-funded and nimble software-based companies that are beginning to make inroads in the market by focusing on unmet consumer demand, bringing down costs, and providing new services.
How does Sunu Equity plan to enhance insurance growth with the third party mobile insurance?
Our USSD (Unstructured Supplementary Service Data) mobile solution is an unprecedented technological initiative in the 100 years of Nigeria’s insurance market.
It is a simple self-service solution that enables car owners/users to purchase authentic third party auto insurance with the use of their mobile phones in less than five minutes. It does not matter whether the phone is a smartphone or a basic phone.
Furthermore, the service is accessible without internet/data bundle and can be used on all the GSM networks. This mobile solution is an example of the disruptive, problem-solving innovations Nigerians have been yearning for.
The key benefits are speed and convenience; customers get their e-certificate in five minutes or less, as well as an automated upload of their insurance details onto the Nigerian Insurance Industry Database.
We are well aware of the government’s drive towards achieving financial inclusion across the country. The Equity Mobile Insurance solution is designed to further this objective as it is available to everyone, regardless of their GSM network, type of phone or whether or not they have access to the internet.
Are you planning to introduce new products?
It is important to note that the Equity (USSD) Mobile Insurance is a scalable and flexible solution. We have started with the launch of the third party auto insurance because it is simple and is the most frequently demanded insurance product in Nigeria.
In the near future, we will deploy and roll-out other products and solutions that are in high demand across our target segments.
We have invested in world-class operating systems and call-centre infrastructure to ensure real-time, online customer support, claims administration and other after-purchase services.
What do you feel Nigerian insurers are yet to get right to enhance the sector’s growth?
The long-standing challenges of low awareness, poor enforcement, customer apathy and poverty continue to impede insurance penetration and growth in Nigeria.
Insurance operators, alongside related associations such as the Nigerian Insurance Association and the Nigerian Council of Registered Insurance Brokers, need to collaborate more and intensify efforts to raise awareness of the innumerable economic benefits and social impact of insurance on personal, business and public life.
Furthermore, enforcement (especially of compulsory insurances i.e. the Market Development and Restructuring Initiative) by government agencies needs to be improved.
Insurance operators need to collaborate better with other stakeholders (within and outside the industry) to develop flexible pocket-friendly insurance products to cater for the less privileged and under-served segments of the market who have little to no disposable income.
What advice do you have for the insuring public on insurance?
Choose a life without worries; get insured today.
What are the prospects of the Nigerian insurance sector in the years ahead?
At Equity Assurance, we look forward to the future with confidence and zest. We all have the opportunity to help build the Nigerian insurance industry of our dream.
In this article: