Flooding Constitutes a Threat to Insurance Industry - Operator

 

Efekoha told newsmen in Lagos that the flooding could also be a threat to the growing micro insurance business in the country.

You will recall that the National Insurance Commission (NAICOM) introduced the MDRI in 2007 and the goal is to grow the industry’s premium income to N1 trillion by 2012.

This is to be achieved through enforcement of compulsory insurance products and introduction of micro insurance to serve the retail end of the market.

“There is no gainsaying the obvious that our market will be threatened by these flooding events.

“As we speak, there are lots of temporary camps for many of our brothers, sisters and friends in affected areas.

“And this is a major challenge for MDRI when we look at growing the retail market,” he said.

“If these are the people we are focusing on: small peasant farmers and rural population, and they are battling for survival, insurance will be the last thing that will be in their priority list,” he said.

Efekoha said that MDRI might suffer setbacks because those affected would need to be re-established to get decent accommodation and guarantee survival before insurance would be looked into.

He said that flooding would also have negative impact on the premium income being expected in the industry.

“We have had this flooding incident and no doubt some of them have insurance policies.

“May be, insurance may not be taken up in the affected areas anymore or for a long time to come.

“Then you will expect that premium to the industry will reduce,” he said.

The insurance expert, however, said that the impact on the premium income would depend on how long the flooding lasted.