The challenging economic situation in Nigeria, driven by rising fuel prices and government policies, is severely impacting the retail insurance sector. Many insurance companies are reporting declining sales of retail products as consumers prioritize essential needs due to the tough economic environment.
Stephen Alangbo, Managing Director of Cornerstone Insurance Plc, acknowledged the difficulties facing the retail insurance business. He noted that high transportation costs have limited the reach of agents distributing retail products, despite efforts to engage customers through digital channels. Alangbo stressed that physical interaction remains crucial for driving retail insurance operations.
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To navigate the economic challenges, Alangbo called for stricter enforcement of compulsory insurance policies, stating that insurance is vital in times of uncertainty. He also urged insurance companies to highlight claims payments, as demonstrating financial support for policyholders would encourage more people to consider insurance.
In addition, Alangbo emphasized the importance of Corporate Social Responsibility (CSR), suggesting that companies that support communities during tough times will gain public loyalty when the economy improves.
Similarly, Ben Ujoatuonu, Managing Director of Universal Insurance Plc, described the current period as a trying time for retail insurance. He pointed out that the income level of many Nigerians who purchase retail insurance is low, making it difficult for them to afford coverage. Ujoatuonu explained that while people understand the need for insurance, the high cost of living has made it unaffordable for many.
Both Alangbo and Ujoatuonu advocated for increased awareness of compulsory insurance and the importance of prompt claims settlements. They agreed that despite the economic challenges, this is the right time for Nigerians to invest in insurance to safeguard their assets, as replacing lost or damaged property has become increasingly difficult due to financial constraints.
Source: Inspensionline
