NIGERIA RE – REPOSITIONING TO TAP GROWTH OPPORTUNITIES
The Managing Director or Nigeria Reinsurance Corporation Plc, Lady Isioma Chukwuma is also the Vice President of Chartered Insurance Institute of Nigeria, CIIN. She tells MESHACK IDEHEN in this interview how her company intends to remain the pacesetter in the insurance industry in Africa, and what can be done to deepen insurance business in the country.
Tuesday, July 1, 2014
Nigeria Re once was the undisputed leader in the reinsurance sector of the industry. How would you describe the performance of the company in recent times?
It is true that Nigeria Re was once the undisputed leader in the Nigerian insurance Industry at large and the reinsurance sector, in particular. The corporation was even among the top five in the African insurance market.
However, following the removal of legal cession in 2003 Nigeria Re lost its enviable position resulting in loss of market share and drastic drop in revenue. Inspite of the significant drop in gross written premium Income, the corporation has continued to record underwriting profit because of its expertise in sound underwriting.
A number of reforms have been carried out by the regulatory body, the National Insurance Commission in the last couple of years. What is your view on these reforms, and how well in your opinion has those reforms affected the reinsurance market in Nigeria?
Yes, NAICOM has in recent times issued a number of directives and come up with several policies and reforms all aimed at repositioning the insurance Industry to contribute meaningfully to the development of the economy.
I will say that the reforms are systematically achieving their set objectives and the insurance industry’s contribution to the Gross Domestic Product, GDP, is also improving, although we are still far from achieving the N1 trillion target. Specifically, NAICOM introduced the Market Development and Restructuring Initiative, MDRI, framework for measuring the industry’s growth.
The recapitalisation policy was aimed at strengthening the capital base of the operators and has increased the retention capacity of the reinsurance market. Similarly, the local content policy has also helped in developing and building local capacity for the oil and gas sector.
Reinsurance is a specialised industry with companies operating in the sector having their own particular clients. How would you describe the response and performance of clients towards reinsurance in the light of current industry situation?
Reinsurance is a specialised and international business. The buyers of reinsurance are professionals who are knowledgeable in the business. The market is very competitive and buyers are at liberty to purchase covers from underwriters who offer the best terms and services.
Globalisation has made the entry of foreign reinsurers into the Nigerian insurance market a lot easier. These entrants put pressure on insurance prices thereby softening the reinsurance market.
Your company recently set a strategic roadmap that is intended to take it to it back to a leading position in the industry. What else is that strategic roadmap meant to achieve?
Besides repositioning the corporation in the insurance industry, the strategic road map also set out a new charge for the management which is to make the company a profitable global player in the reinsurance market. The Road map is also designed to create more market for the company, improve customer’s relationship and increase the company’s premium level.
What plans do you have in place to see to the realisation of those strategic objective set out in the roadmap?
A number of plans have been put in place towards the realisation of the strategic objectives that have been set; some of these include continuous staff training and development aimed at enabling the staff take responsibility for the implementation of the new charge.
Others are effective alignment of the organisation with customers using loyalty principles, and programs geared towards improving the company’s visibility. Such programs include image projection through media adverts, production of Nigeria Re’s newsletter, organisation of customer’s fora where loyal customers will be appreciated, road Shows, participation in corporate social responsibility and improved corporate website.
Timely payments of claims by the insured have always been a challenge conventional and reinsuring insurance companies grapple with. How do you intend to correct that situation particularly with regards to Nigeria Re?
Because we appreciate the importance of timely settlement of claims as a way of winning and retaining customers’ confidence and loyalty, the corporation has reviewed its claims payment policy. Settlement of genuine and admitted claims is now treated as top priority in the organisation as long as all necessary documentations are completed in good time by the cedant or broker.
With your company’s currently running an advert on the CNN, and with part of your new focus being on the external market, how do you plan on retaining existing local clients while signing on new ones?
The CNN advert was on for one month with the aim of improving the company’s visibility with our external clients in line with the new charge of being a profitable global player in the reinsurance market. Our focus on the external market is targeted at expanding our geographical spread and market share.
Regarding our plans on retaining existing local clients and signing on new ones, our strategy is to use the loyalty principles of, that is, rewarding the right results i.e. our loyal customers from time to time, including having listening ears to our customers’ complaints and dealing with them appropriately;
We also aim to retain and sign on new customers by practicing what we preach, that is honouring our commitments and ensuring that the business relationship is a win/win one. Being picky by carefully choosing whom to have long term business relationship with and keeping it simple and ensuring that our administrative and accounting procedures are such that can attract and retain new customers.
Experts are of the opinion that large untapped possibilities still abound in Nigeria’s reinsurance market. What plans are you making to explore and take advantage of these opportunities?
Growth opportunities definitely abound in the Nigerian insurance market and the corporation is taking steps to develop its competitive advantage to be able to tap these opportunities.
Nigeria Re’s competitive efforts will focus on the following areas such as innovation: In addition to the traditional reinsurance products, Nigeria Re will be in collaboration with her external partners develop other innovative reinsurance products not only for our existing clients but will aim at attracting new ones.
We are also focused on service quality: Improved claims administration will help improve the image of the corporation thus attracting more clients. Customer loyalty programs are also on our radar. The corporation will effectively apply the loyalty principles to attract new clients and sustain existing ones.
As the new Vice President of the Chartered Insurance Institute of Nigeria. How do you intend to leverage of that position to drive reinsurance in the country?
One of the primary objectives of the CIIN is to promote educational development in the Nigerian insurance market. As the new deputy president, I will provide back-up support for the president in executing developmental programs of the Institute. I will specifically encourage reinsurers to collaborate among themselves to provide quality service for the insurance companies and to charge adequate rates for their coverage.
In what specific areas would you want the government through NAICOM to act in order to deepen the business of reinsurance in the country?
I will want the Government to continue to support the drive for micro-insurance in Nigeria and to also encourage the consolidation of insurance and reinsurance companies in the country.
