Onanuga Urges Insurance & pension sectors operators to tailor products in line with people’s needs

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If you consider what happens in developed economies, there are different kinds of plans to meet different needs.

Folashade Onanuga, former Director General, Lagos State Pension Commissioner (LASPEC) said the opportunities which exists for increased financial inclusion in both the Insurance & pension sectors will only be achieved if we design products that are perceived to meet the people’s needs and could be seen as improving their welfare rather than impoverishing them.


Onanuga stated this as keynote speaker during the 2021 Annual Conference of the National Association of Insurance and Pension Correspondents (NAIPCO), Held on Thursday, October 14, 2021 At Oriental Hotel, Lagos that operators must constantly be engaged in strategic thinking; have a broad understanding of the economic situation of the country, understand the mindset and ways of life of different ethnic groups and then have a variety of products from which the people can make a choice from.


Speaking of insurance, Mrs Onanuga pointed out that opportunities exist to increase insurance penetration and the customer base, both in the retail and corporate segments of the market if the right moves are made. According to her, insurance penetration has remained at an average of 0.4% of GDP driven largely by a general lack of understanding and awareness of the benefits of insurance products, specifically amongst low-income Nigerians.  We need to build trust.  The Banking Sector has managed to bridge this gap to an extent.

As former DG of LASPEC, she revealed that attempts have been made to improve the performance of the insurance industry through regulation and legislation – new capitalization requirements have been announced and reviews of several key laws are being discussed to bring them up to current realities. In improving access to insurance and making products and services more inclusive, we are discovering that there is a role for all stakeholders to play, she noted.


“Over the last 17 years, a tremendous amount of progress has been made in the Nigerian pension industry and regulation has enabled this growth.


However, according to her inclusive growth in pensions must recognize the peculiarity of the population segment being addressed. This recognition must have an impact on how products are designed and how lower income segments of the population interact with pension funds, she added.


Fmr DG said if you consider what happens in developed economies, there are different kinds of plans to meet different needs.

“The National Pension Commission needs to take more advantage of digitization in pension operations to make transactions easier and more accessible.    In this, she added we can take a page out of what the banks have done to provide banking services to lower-income population groups.  Structures must be in place before the release of pension laws to ensure that all aspects of the Law are implementable, she said.


“The contributory pension scheme in Nigeria was designed to address the problem of inadequate or no preparation for retirement. However, the scheme has done much more – it has allowed incredible mobility for employees in the formal sector; it has simplified the administrative processes, has reduced drastically the fraudulent practices in pension scheme administration but is yet to fully address the issue of ensuring that retirement benefits are paid as at when due most especially where benefits accrue to workers under the defined benefit plan. She said pension benefits as received by many in the CPS dispensation, have been considered very inadequate to give comfort in old age. While we would like greater participation from State Governments and small/medium sized corporates, that is not something we can boast of today.

Mrs Onanuga further noted that in coming up with solutions to address these problems, we must consider the basic needs of our clients when they indeed retire – food, shelter, healthcare and transportation. These needs must be considered in conjunction with inflation so that consumers can get the intended benefit that this scheme was created to provide, she concluded

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