The Nigerian Insurers Association, NIA, has called on insurance companies operating in the country to improve their claims settlement processes, strengthen their capacity to underwrite bigger risks and deliver better customer service.
The call is coming on the heels of the successful completion of the insurance industry’s N1.079 trillion recapitalization exercise, which was aimed at repositioning the sector for greater efficiency and stability.
The Chairman of the association, Mrs. Ebelechukwu Nwachukwu, made the call at a major industry event in Lagos, where stakeholders gathered to review the impact of the recapitalization and the way forward for the sector.
According to her, the recapitalization exercise is a major milestone for the Nigerian insurance industry, but its success will not be judged by the amount of capital raised but by how effectively the companies deploy the additional funds.
She explained that the essence of the exercise was to make insurance companies financially stronger, more resilient and better positioned to meet their obligations to policyholders and to play a more active role in the nation’s economy.
Nwachukwu stressed that with stronger capital bases, insurers now have no excuse for delays in claims settlement, poor customer service or rejection of legitimate claims, which have been some of the factors affecting public perception of the industry.
She said that stronger financial positions must translate into tangible benefits for policyholders, including faster and fairer payment of claims, improved quality of service delivery and greater access to insurance products for individuals and businesses.
According to her, Nigerians will only appreciate the impact of the recapitalization if they see that insurance companies are now more responsive, more reliable and more willing to pay genuine claims promptly without unnecessary bottlenecks.
The NIA Chairman noted that for many years, lack of confidence and trust has been a major challenge facing the insurance industry in Nigeria, with many people reluctant to take up insurance policies.
She said one of the major reasons for this apathy is the experience or perception that insurers delay or deny claims when losses occur, thereby leaving policyholders stranded at their most critical moment of need.
Nwachukwu warned that if insurance companies continue to delay claims settlement even after becoming better capitalized, it could further weaken public confidence in the sector and discourage more Nigerians from embracing insurance.
She explained that insurance is built on trust and that the promise to pay claims is the core of the business, adding that any company that fails in that promise does not deserve to remain in business.
The Chairman therefore urged all insurance companies to take the issue of claims payment very seriously and to put in place efficient systems that will ensure that claims are settled promptly, transparently and fairly.
She also called on insurers to improve their underwriting capacity so that they can take on bigger and more complex risks that were previously ceded to foreign insurers, thereby retaining more premium within the country.
According to her, with N1.079 trillion fresh capital in the industry, Nigerian insurers are now better placed to cover large risks in sectors such as oil and gas, aviation, marine, and large-scale manufacturing and infrastructure.
She said this will not only help to conserve foreign exchange but will also position Nigeria as a leading insurance market in Africa capable of providing cover for big-ticket transactions.
Nwachukwu further charged insurers to invest in technology, innovation and human capital development to improve their operations and to make insurance more accessible and affordable to the average Nigerian.
She noted that technology can help reduce operational costs, speed up claims processing, improve customer experience and enable companies to develop products that meet the specific needs of different segments of the population.
The NIA boss also called for better customer service across all touch points, from the point of sale to claims handling, stressing that policyholders deserve to be treated with respect, empathy and professionalism.
She said insurance companies must train their staff, especially frontline officers and agents, to understand that they are in a service business and that customer satisfaction should be their topmost priority.
She also urged insurers to be more transparent in communicating policy terms and conditions to clients, so that policyholders clearly understand what is covered, what is excluded and how to make claims when necessary.
Nwachukwu said that improved transparency will help reduce disputes over claims and will enhance trust between insurers and their customers, which is critical for the growth of the industry.
She also appealed to insurance companies to collaborate more with the NIA and the National Insurance Commission, NAICOM, to promote insurance literacy and awareness across the country.
According to her, many Nigerians still do not understand the importance of insurance and how it can help protect their lives, properties and businesses against unforeseen risks and losses.
She said the association will continue to work with regulators and other stakeholders to create an enabling environment that will support the growth of the industry and ensure that the benefits of recapitalization are felt by all Nigerians.
She concluded by expressing optimism that with stronger capital, better governance and renewed commitment to policyholders, the Nigerian insurance industry will witness greater public acceptance, deeper penetration and increased contribution to the nation’s Gross Domestic Product in the coming years.
