SWEAT THIS POPULATION THROUGH INSURTECH By Ekerete Ola Gam-Ikon

In the BUSINESS of NUMBERS, what matters are the numbers! It is always about those available versus those that actually become subscribers and users.

Basically, there are:

• Available number of people that can use the products and services across the country;
• Available number of people that can pay for the products and services; and
• Available number of people that are willing to pay for the products and services, including the young ones who can use part of their allowances or can borrow to buy.

Those available (individuals, organizations and governments) are quite huge and can be overwhelming for one organization in the BUSINESS of NUMBERS to contemplate and consider in a fast moving populated country like Nigeria.

It is normal to hear business leaders and executives in strategic sessions considering the opportunities in Nigeria say “let’s even start from the major cities first.” Years later, they hardly go beyond those cities because the mental energy and drive would have diminished, and the ambitions of the past disappeared, as same leaders begin to see and analyse problems of the country without seeing how their products and services can be part of the solutions needed.

We have allowed the fear of failure and what I call “the currency of self” stunt our growth, individually and otherwise. You cannot do it alone over the years, hence, a few business leaders have understood how to rely on the mental energy of the younger ones to increasingly expand their businesses and exploit the opportunities offered by our population.

Sometimes, there have been cases of pushing the old products and services to the population of younger people whose needs are unique and can only be met by new products and services. This, most probably describes the story of the insurance industry in Nigeria.

Interestingly, the industry has a new engine – Insurtech!

Is it ready to use it? From a regulatory standpoint, I see a rather careful and modest response, which has left room for the usual aggressors to consider how to takeover the regulation and supervision of the operations and activities of insurtech firms from the insurance regulator, National Insurance Commission (NAICOM).

So, insurtech firms are viewed as tech companies in Nigeria and should probably be regulated and supervised by the technology regulator but can someone please see that they are SELLING INSURANCE?!

It is the technology deployed by these insurtech firms that gives us the renewed hope that the insurance sector in Nigeria can and should deliver better results with more of the population insured.

Insurtech firms, in my view, are insurance businesses leveraging technology solutions! This is happening in ways like we have seen in the banking sector and those Fintech firms are regulated and supervised by the Central Bank of Nigeria (CBN).

With insurtech firms, we can indeed reconsider the growth opportunities for insurance and a new drive towards deepening insurance penetration rate in Nigeria. NAICOM needs to deliberately seize the moment and license the insurtech firms as part of the entities under its regulation and supervision. The fact that they are selling insurance allows NAICOM to do this!

As mentioned elsewhere, insurtech is the new engine that will enable the insurance sector deliver unprecendented results, essentially increasing the number of policyholders and the contribution of insurance to Nigeria’s Gross Domestic Product (GDP).

The tech solutions developed and deployed by the insurtech firms have the capabilities and capacity to sweat Nigeria’s population.

These firms can scale and make insurance reach remote areas at relatively low cost across the country. They will, based on their modelling, be able to easily provide the numbers we desire, in terms of demographics and the impact on the growth of insurance.

Today, according to NAICOM, we have 3m policyholders but do not have the numbers in terms of the individuals, their ages, gender, vocation and location. Even if we can extract these demographics from the available data, the insurtech firms will automatically generate them due to the configuration of their technology which incumbents or traditional insurers would not have.

I am very much aware of the growing partnerships between the traditional insurance companies and the insurtech firms, in the absence of the enabling law to license the latter, however the terms and conditions of these partnerships does not allow the insurtech firms express themselves enough.

For example, the insurance industry in Nigeria does not offer Trade Credit Guarantee or Credit Guarantee anymore as a product despite the increasing demand for it. I know one or two insurtech firms that have solutions to allay the fears and concerns of traditional insurers and offer the product with improved security yet the traditional insurers bring up the bad experiences of the past to hold back.

I am confident that if insurtech firms were separately licensed by NAICOM, they will know how to seize such opportunities and generate premium income accordingly.

Meeting the needs of customers has always been important and necessary for businesses that prioritise growth of significant measure and traditional insurers have worked hard on this with little success over the years but insurtech firms have come along with the capacity to achieve greater successes for the insurance industry in Nigeria.

The remarkable aspect of the offerings by insurtech firms can be seen in the fulfilment of all the elements of availability, affordability and accessibility towards achieving sustainable growth for an intangible product like insurance. The need to position the insurtech firms well, by way of licensing, cannot be overstated.

Emergent insurtech firms in Nigeria have announced and are selling Motor Insurance policies approved by NAICOM for as low as N200 and on pay-as-you-use basis which our law allows but were not offered by incumbents or traditional insurers.

Imagine for a moment that about 13m registered vehicles in Nigeria have their owners using any of these solutions offered by these insurtech firms, most certainly the number of insurance users will escalate while premium income will increase as well as the level of insurance awareness amongst the populace.

Expectedly, we will see the activation of other product lines of insurance namely buildings, health, accident and life.

As we advocate for more adoption of insurance in Nigeria and the introduction of suitable insurance products and services, we want to tell people where to get more information and NAICOM should be the rallying point.

Insurance is a BUSINESS of NUMBERS, so the insurance industry in Nigeria should embrace and retain those that have solutions to deliver them.

I remain…

Assuredly Yours,

Ekerete Ola Gam-Ikon

+234-802-585-0344

olagamola@gmail.com