13 December 2017

Nigeria: Redefining Life Insurance in Nigeria

Ebere Nwoji looks at recent moves by new generation insurance companies, among them, Custodial Life Insurance to package insurance policies that guaranty benefits to the insured while alive

Life insurance according to insurance experts unarguably holds the future of insurance sector growth in Nigeria. This is due to its nature as a line of business that affects every body.

But despite its all important nature, not many Nigerians have life insurance not even the group life insurance which aside its compulsory status as stipulated by the Pension Reform Act 2004 amended in 2014, different work groups can on their own gather to secure group life or group accident insurance policy for their members.

From findings, it has been discovered that one of the factors that scare members of the insuring public away from life policy is the fact that most of the policies sold in Nigeria mature at death, as such after spending their hard earned money to pay the premium for several years, the insured hardly benefits anything while alive rather all efforts is geared towards making provision for his dependents to benefit and keep life going after his death.

With this in mind, many people shun life insurance policies.

Indeed, many see putting in place life insurance arrangement as signing their death warrant, as such, give it the last consideration in their list of preference.

Against this backdrop, modern insurers have determined to redefine the face of life insurance policies by pushing to the market policies that give benefits to the insured at his life time.

Indeed, they have gone into earnest search for life policies that will give the insured the opportunity of benefiting from the policy while still alive and even prevent him from dying as well as policies that will improve on their financial wellbeing especially at hard economic times.

Recently, Custodian LIfe Insurance Ltd came up with one of such much desired life policies that offer the insured the opportunity of benefiting from the policy while still alive.

The company recently launched a product that will enable the insured conveniently seek for adequate medical treatment at home or abroad without turning himself and his household into public beggars in order to get funds for medical treatment.

The company, tagged the product "Custodian Critical Illness Insurance Policy (CCIP).

The policy, which is the first of its kind in Nigeria, is for those suffering from critical and terminal illnesses such as stroke, cancer, heart attack and Renal failures.

The company, which described the product as a stand alone policy of its kind in Nigeria, said launching the product was informed by the present economic and health difficulties in Nigeria to assist millions of Nigerians who are victims of the above illnesses address their health challenges.

Currently, the trend in Nigeria is to see people affected by these terminal sicknesses writing to philanthropists, governments at all levels, civil society and humanitarian organisations through agents or non governmental organisations for financial assistance to seek for medical attention outside Nigeria.

The amount often sought for by these unfortunate victims ranges from N10 million to N20million but sad enough, many of them give up the ghost before the money was made available by the donors.

A case in point is the Veteran comic-actor Moses Olaiya, better known as Baba Sala, who has reportedly suffered a stroke and has sought help from Nigerians.

Media reports said that the octogenarian personally made the appeal recently at a briefing on his biography entitled 'The Triumph of Destiny'.

He was quoted to have said: "I need help. Nigerians should help me. I am not dead yet, they should not let me die suffering."

The comedian was reportedly looking frail and required human support to walk.

Dele Adejumo, his son, was quoted as saying: "He has investments but they have all been wrecked by mismanagement. He also had a three-storey building in Mushin, Lagos which he had to sell to offset debt incurred when his work, Orun Mooru, was pirated.

"We still have some of his recorded works not in public yet but machines that will be used to transform them to an acceptable format are not easily available. We do not have the kind of money they are charging us, said his son.

Another veteran actor, Sadiq Daba, is said to be currently ill and he recently lamented that it is very expensive to pay for his treatment.

Similarly, a number of Nollywood actors, journalists and other public figures have fallen victims of this ugly situation, some got instant help and are alive today while others could not and as such died just like that.

This is so whereas among Nigerian neighbors, such public figures especially actors, insure their body parts for millions of dollars against injuries that may affect their uses for future performances.

For instance, Gene Simmons (born August 25, 1949) , an Israeli-born American rock bass guitarist, singer-songwriter, record producer, entrepreneur, and actor. Known by his stage persona The Demon, he is the bass guitarist/co-lead vocalist of Kiss, a hard rock band he co-founded in the early 1970s. With Kiss, Simmons has sold more than 100 million albums worldwide. Reports said he insured his tongue for $1 million.

With this, insurance managers in Nigeria have said that people, especially public figures need not beg to obtain medical treatment at home or abroad if they can put in place adequate insurance arrangement for the unknown and unforeseen.

But many Nigerians, often due to religious belief and culture wish away such sicknesses but this has not stopped them from affecting those they want to affect.

Custodian life insurance, in developing the critical illness insurance policy said

"We are well aware of the current economic, health difficulties in our country today for us at custodian insurance, tough times are for us to get tougher and not use the current climate as a negative block but rather an energising spring-board for new ideas. It is on the back of this that we have launched the critical illness insurance cover which we are confident will assist millions of Nigerians to address their health challenges", said Larry Ademeso, Managing Director Custodian Life Insurance.

According to him, unlike the Group Life Insurance policy which benefits are paid to dependents of the policy holder at his death, in the case of the critical illness insurance cover, the policy holder is six times more likely to claim under his critical illness cover than under the group life cover.

"Employers in Nigeria today are required by law to provide group life insurance cover for their employees, that is as far as the story goes , benefits will be paid to your beneficiaries when you would have passed away so what happens if you do not die but become incapacitated by some of the debilitating illnesses ravaging the populace this is why we developed the critical illness cover to meet the yearnings of Nigerians."

According to the Custodian Life insurance boss, the custodian Critical Illness Cover, offers the policy holder added protection and confidence boost to go about his daily activities without fear of possible financial backslash associated with treating a critical illness.

He quoted the World Health Organisation as saying that Nigeria has the highest cancer rate in Africa while there is increasing precedence of stroke just as about 10per cent of adult Nigerian population is liable to have heart attack.

He listed key features of the product as enhanced protection, coverage against conditions that fall under cancer, stroke, heart attack, kidney failure.

He said the premium paid and benefit received are per the prevailing tax laws, adding that the intending policy holder can choose period of coverage.

He said sum assured for the policy is minimum of N1 million while the term is minimum of five years.

He also said eligible buyers of the product are people from 20 years to 60 years while the premium is paid annually.

According to him, since Custodian is the first company in Nigeria to sell the policy, in future, other conditions that make the policy more attractive and enable those who paid premium many years without claims to be considered.

Similarly, Anchor Insurance Company Limited, recently launched its innovative and unique life insurance product tagged Anchor Loss of Employment Insurance scheme, popularly referred to as AnchorLoEIS.

The Chairman, Board of Directors, Anchor Insurance Company Limited, Dr. Elijah Akpan, at the event in Lagos which attracted captain of industries, Bank Chiefs, co-operative unions, insurance practitioners, insurance brokers, employers of labour, employees and the insuring public, revealed that in launching the product, the company targeted at addressing a real kitchen table issue for families all across Nigeria.

We have an opportunity and a responsibility to innovate and create an insurance scheme to protect employees' employment income and in doing so to provide a measure of financial stability to millions of Nigerians who may be laid off in the most difficult economic time. We have the opportunity and the responsibility as an organisation to provide peace of mind to families who may be left in the ditch without a job and nowhere else to turn to," he stated.

Also Wapic Insurance Plc, recently championed the course of encouraging Nigerians to cultivate good savings culture with its array of SMART Products targeted at not only giving competitive interest rate to consumers but also offering free life insurance cover to savers.

The Managing Director of Wapic Life Insurance, Rantimi Ogunleye, explained how savings through the company's various smart products work stated: "So here's how it works; you want to save towards a short term goal, you choose the plan that works for you depending on your need. An account is then created for you and you save monthly. Now for the period of your plan you have life insurance cover!"

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