By ROSEMARY ONUOHA
The recent flooding in some parts of the country has left some devastating impacts in its wake. Although the Federal Government has promised that it will do all within its power to ensure that such disasters don?t leave behind huge damaging impacts in the future, so far, government is yet to say whether there are plans to include insurance in the scheme of things.
The devastating impact of the flood, according to Managing Director of Lasaco Assurance Plc, Mr. Olusola Ladipo-Ajayi, exposes the lack of insurance awareness in the country. ?When elites don?t insure, how do you expect peasants to take up any form of insurance? Ladipo-Ajayi queried.
The majority of the people that have so far been affected by the flood are mostly of the low income brackets that are averse to insurance due to factors of poverty and lack of awareness. As a result, experts are of the opinion that government can help in rebuilding the lives of these victims as well as the economy of the affected areas if it strategically include insurance in all its planning.
According to the Group Managing Director, Mutual Benefits Assurance Plc, Mr. Akin Ogunbiyi, insurance should be the backbone of any national economy. ?Insurance is a medium, where you can put funds together and make it available for long-term investment in other sectors. But unfortunately, the way we are doing insurance in Nigeria today is like a non-starter,? Ogunbiyi said.
Need for public awareness
The recent flooding, no doubt has brought to the fore the lack of insurance awareness on the part of majority of the public. It is in this light that stakeholders have called for more drastic measures to drum up the importance of insurance to the general public.
According to the President of the Chartered Insurance Institute of Nigeria, CIIN, Dr. Wole Adetimehin, insurance operators should drum the need for insurance because of the huge effect of the flood which has destroyed lives and property in many states.
Adetimehin said ?In many ways insurance remains an essential index for measurement of national development although lacking in its expected degree of presence in both individual and national consciousness, especially in developing countries like Nigeria.?
?Recent flooding of parts of Nigeria and cases of related environmental hazards make insurance the way to go for Nigerians. The insurance sub-sector must seize this as the needed opportunity to drive home its age-long message,? he said.
For Ogunbiyi, there was no reason insurance should not be the biggest of the sectors in the economy, if only about 25 per cent of its potential in the country was utilised.
?If you look at what is happening in developed economies of the world, insurance is a basic point of making value, alleviating poverty and empowering people in terms of what they use the pool of resources that they get to do. If you look at the housing sector in developed economies, virtually in more than 90 per cent, you will find that it is insurance funds that are being used to compensate victims?
The role of government
The escalating poverty level in the country is a major factor hampering growth and acceptance of insurance by majority of the public. According to experts, if the economy should continue in the snail-like pace as it stands presently, the target of the government in achieving its vision 20 20:20 target will be a mirage. Consequently, the government has a huge role to play in the drive towards making the public embrace insurance.
According to Adetimehin, when the level of disposable income is nothing to write home about there won?t be increased demand for insurance products from the public.
?If the industries rather than increasing in number or expanding by the day are shrinking and laying off people, how do you expect the insurance sector to grow. When the level of disposable income is nothing to write home about, where do you expect to find the demand for insurance products? It is high time the government begin to address all these fundamentals with all the seriousness it deserves if anything like the vision 20:2020 will be achieved or crystallised,? Adetimehin said.
Another way the government can contribute to the growth of insurance is by promptly paying premiums for all its insurances.
According to the president of the Nigerian Council of Registered Insurance Brokers, NCRIB, Mrs. Laide Osijo, government must see to it that insurance premiums are included in yearly budgets of its institutions in order to reduce the incidence of non-payment of premiums which characterises its insurance operations over the years.
Osijo said that government, which represented the largest chunk of insurance consumer, needed an acceptable insurance road map to maximize its insurances and minimize wastages.
According to her, payment of insurance premiums by clients was a precondition for any insurance contract in line with Section 50(1) of the 2003 Insurance Act, failure which insurance companies would not be able to pay claims when a loss occurs.?
In order to develop its insurance manpower, the NCRIB boss said that government must constantly upscale the skills of its insurance desk officers to apprise them with the changing dynamics of insurance practice, adding that only professionally qualified insurance personnel should be recruited henceforth to man such insurance departments or units.
The way forward
The federal government, since the administration of President Goodluck Jonathan came into force, has been harping on economic growth as well as being the 20th best economy by year 2020, however, experts are of the opinion that the fundamentals that will propel such growth are still? lacking.
Adetimehin said, ?It is common knowledge that till today the battle to build a stable power supply has not found a solution. There is no way any economy or industry will grow when you don?t have stable power supply. Look at the level of fraud and corruption in the country. It is like governance is now the primary business because in a way they have killed all sectors, leaving governance as the only thriving thing. It has become a do or die affair where everybody wants to play.?
According to Adetimehin, government have to address basic fundamental issues affecting the environment in its entirety because it will be difficult for any sector of the national economy to experience any growth when the basic infrastructure are not receiving due attention year in and year out.
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Source: http://www.vanguardngr.com/2012/11/salvaging-flood-disasters-without-insurance/
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