By Yemisi Izuora-Abuja
The federal government has challenged the insurance industry on premium generation and has therefore set a target of N5 trillion gross written premiums (GWP) for the sector in the next 10 years.
Economy and finance minister, Dr Ngozi Okonjo-Iweala, who disclosed this in Abuja expressed disappointment that the sector which has enormous potential of contributing significantly to national economic growth has a ratio of premiums to the gross domestic product (GDP) of only 0.4 per cent in Nigeria.
She said the country ranks the lowest compared with 1.1 per cent in Ghana; three per cent in Kenya; and for the BRICS (Brazil 4.0 per cent; Russia 1.3 per cent; India 4.0 per cent; China 3.0 per cent; and South Africa 15 per cent).
The minister who was addressing the National Insurance Summit on monday said the target is for the insurance sector in Nigeria to grow its ratio of premiums to GDP to 1.6 per cent.
According to her, unleashing the latent energies of the insurance industry to create more jobs and boost economic development is one of the country’s strategic responses to close the gap created by the economic challenges confronting the nation at the moment.
“The first part of our vision would be to grow the GWP of N300 billion today to N1 trillion in the next three years, and to N5 trillion within the next decade. So we should be attaining gross premiums of about $30 billion in a decade from today,” Okonjo-Iweala said.
She noted that the second part of the vision would be to deliver jobs in this industry. According to her, the insurance sector is a powerful engine for job creation in the economy. But today, there are only about 30,000 people working in the Nigerian insurance industry.
“This sector should clearly be creating many more jobs for us. So the second objective of our vision would be to grow the number of direct jobs created in this industry from the current 30,000 people to 100,000 people in the next three years, and to more than 300,000 people in the next decade,” the minister noted.
Also speaking, the commissioner for insurance and chief executive officer (CEO) of the National Insurance Commission (NAICOM), Mr Fola Daniel, said the sector would soon commence a money-back guarantee on insurance policies purchased if it failed to suit the client’s purpose.
“We will create a situation in our policy where people can actually return the policies if it does not suit the purpose for which they bought it.”