The recent retirement announcement of the erstwhile Chairman and four Directors from the Board of Guinea Insurance Plc, having served over nine years, came on the heels of NAICOM’s move to ensure sound business practice, effective compliance with all statutory requirements and the code of good corporate governance as stipulated in section 5.04 (vii) of the 2009 Corporate Governance Code of NAICOM.
The insurance sector in Nigeria is confronted with numerous challenges: economic downturn, low level of coverage for insurance services in the country with approximately 1.5 million insurance policy holders out of the over 170 million population patronizing insurance services and products. This low penetration rate demonstrates that there is a dearth in the level of acceptance for insurance products among the people and institutional clients.
In a reaction to the question at hand regarding the numerous headwinds slowing down growth in the industry during a recent chat in Lagos, Godson Ugochukwu, Chairman, of the newly constituted Board of Directors, Guinea Insurance Plc, said “we have positioned ourselves to go with the current tide of structural and operational changes in the insurance industry. There has been a renewed focus on corporate governance and the Board has spent a significant proportion of its time examining and strengthening the operational processes throughout the company. Having a solid corporate governance framework is key to rebuilding trust and transparency with al stakeholders.”
“Contrary to fears that the decline in national revenue occasioned by the fall in oil price and depreciation in the naira value, would spell hardship for insurance industry as expressed recently by insurance practitioners, I am of the believe that the insurance sector has the potential to grow volumes and enhance shareholders’ value but it requires insurance companies to device means of taking advantage of growth opportunities around them because doing so, would not only increase its penetration but also, enhance awareness and the sector’s contribution to GDP.”
“As a company destined for greatness and propelled by a Board of Directors and Management team with insatiable thirst for success, we keep the faith that there are no limits, there are only plateaus. We have therefore, taken steps to ensure that our greatest asset – our people, are enhanced through human capital investment. I am pleased to say, that in such a short while, we are beginning to experience growth in our business. I therefore, make bold to say that the future is indeed very promising.”
Meanwhile, the Chairman called on government to provide the necessary regulatory mechanisms, conducive business environments and ensure full enforcement of compulsory insurances in Nigeria as it would not only drive the growth of the sector but also, contribute significantly to the growth of the country. He however expressed regret on government’s lack of political will to enforce certain laws and policies which he said were serious headwinds that have slowed down the growth of the industry.
In his closing remark, the Chairman opined that insurance underwriting in Nigeria was an extremely worthwhile venture but, it required government’s intervention especially at this time when the current economic crisis occasioned by high inflation and low disposable income, have significantly impacted on the performance of insurance practitioners.
“When economies experience downturn, the first casualty is insurance. We have seen a lot of reduction in interest for insurance as lot of people who naturally would buy insurance, would regard it as a secondary issue due to the fact that insurance business thrives on the back of the economy” he said.