By Oladipupo Mojeed
The Minister of Finance, Kemi Adeosun, has revealed that only three million out of 180 million Nigerians possess insurance policies.
Adeosun, who revealed this at the ongoing 2017 National Insurance Conference (NIC) in Abuja, noted that insurance plays a critical role in the economy.
The theme of the three-day conference is: “Nigeria Open for Business.”
Represented by Alhaji Mammud Dutse, Permanent Secretary in the Ministry of Finance, Adeosun said insurance facilitates investments by reducing the amount of capital and savings needed by individuals, corporations and agencies to fight unforeseen losses.
According to the minister, total insurance premiums grew from N75billion in 2005 to over N300billion in 2016 and contributed approximately 0.7 percent to the Gross Domestic Product.
She added that the figure is less than the African average of 3.3 percent and the global average of seven percent.
The 2017 event would be the third since the conception of the Insurance Industry Consultative Council (IICC) in 2015.
IICC is an amalgamation of all the constituent arms of the insurance industry, which includes the Nigerian Insurers Association, Nigerian Council of Registered Insurance Brokers and Institute of Loss Adjusters of Nigeria.
The minister also lamented that the insurance industry was facing the challenge of low-level penetration.
“This means insurance from writing more premiums from millions of Nigerians can provide finance for our long-term economic growth for the country’s recovery.’”
She said that practitioners must be willing to do more to make insurance a giant industry to look up to, adding that distribution channels must be innovative and that new products should be developed to attract the populace.
She argued that to achieve conclusive growth, insurance must be deployed to rural areas.
“Deepening insurance penetration to the rural areas must include, improving technical capacity to meet the emerging market trends.
“The best way to promote insurance is to incorporate both individuals and corporate entities into the insurance market,” Adeosun said.
The minister also vowed that the Federal Government would ensure that its economic reforms supported the growth of the insurance industry.
She added that many foreign investors had indicated interest to invest in the sector.
“There is also a high level of ownership of insurable assets in Nigeria, despite the economic situation.
“We expect that industry reforms will continue to drive investments and new market entries.
“Foreign investors have shown great interest in the Nigerian insurance sector by entering into the market and progress can be seen in the introduction of new insurance products in the growing mortgage and housing sector.
“To concentrate on the progress being made so far, Federal Government will always play its part to ensure that government assets are properly insured,” she said.