Takaful insurance is a new model in Nigeria that is gradually penetrating the risk underwriting market with futuristic products and services as the promoters remain innovative in their brand development strategies. In this interview with a select media team, the Managing Director/CEO of Crown Takaful Insurance Limited, Nasir Abubakar Song, shares his thoughts about the industry and what his company is out to offer. Excerpt:
Give us an overview of the performance of the Nigerian insurance sector over the past decade and its contribution to the nation's growth?
The insurance sector is an important player in the Nigerian economy, providing vital financial services, promoting economic stability, risk mitigation, capital mobilisation, job creation, social security, and contributing to the overall growth and development of the country.
On the contribution to the economic growth of the nation, the insurance industry recorded more than N1 trillion gross premium for the year 2023 alone. I think this is a commendable feat in the industry.
One of the challenges the industry has contended with over the years is the low confidence of the public.
What do you think is responsible for that?
In the case of Nigeria, several factors have contributed to low public confidence in the insurance sector. This majorly arises from poor perception and lack of trust, low awareness and understanding of insurance, as many Nigerians seem to have limited knowledge about insurance products, how they work and the benefits they offer.
This lack of awareness has led to skepticism and reluctance to engage with insurance companies. However, it is worthy to note that the tide is changing because of strategic awareness programmes being initiated by the industry's regulatory commission and professionals. This has led to a 27% growth in industry penetration in the year 2023.
Undoubtedly, the outlook for risk underwriting is getting brighter by the day due to increasing investments across the broad spectrum of the economy. What opportunities does this portend for improved performance?
Yes, this gives the insurance companies a lot of opportunities to market their products and services to these investors, because insurance is the most dependable financial recovery plan for any investor and, therefore, those investments must be protected.
Non-interest insurance model is relatively new in Nigeria. Why is Crown Takaful Insurance championing ethical risk sharing model for businesses and individuals?
Crown Takaful Insurance is coming in to play its role in increasing the level of insurance inclusivity in Nigeria by way of providing alternative risk mitigation financial services to businesses and individuals.
The low level of insurance penetration in Nigeria is not good for a developing economy. That is why Takaful Insurance Company will play a significant role in bringing uninsured Nigerians into the insurance sector.
What is Crown Takaful Insurance bringing to the market that will raise the confidence level as a preferred brand?
The Takaful Insurance model is based on mutual protection and shared responsibility among the participants of the Takaful pool. Our products are designed to give participants the protection they need and allow those participants who did not make claim from the Takaful fund to participate in surplus distribution once the portfolio generate profit at the end of Takaful period, which is usually one year from the inception of the policy.
Crown Takaful Insurance is not just another insurance market entrant but a protection for all - from the bike rider to the multinational companies and from the farmer in the rural area to the business tycoons in the city. There is a product tailored to confer excellence. Both Crown Takaful and our participants will be better off taking the Takaful insurance contract.
Another big challenge in the industry is low awareness about the benefits the policy covers for the insured, especially at the grassroots. How prepared is Crown Takaful Insurance to tackle this issue?
One of the strategies for reaching out to Nigerians is through intermediaries and partnerships with affinity groups and cooperative associations that will be our field soldiers.
They will be in the nooks and crannies of the country. They will be trained and equipped with the company's flyers and products descriptions, which highlight the benefits of every cover before the purchase of any Takaful policy.
What marketing strategies do you intend to deploy that will deliver on these promises you have made?
As a management, one of the key marketing and brand positioning strategies we intend to adopt is social media. We really want to create awareness through social media platforms knowing fully well that young Nigerians and other value-driven professionals and investors explore social media for innovative products and services and socioeconomic opportunities. In doing this, we will not overlook the insurance brokers and other intermediaries in the distribution channel to market our products.
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What is your view on the current insurance regulatory regime and where, if any, would you like the authorities to thinker with to make the environment more conducive for players, especially for new entrants like you?
The National Insurance Commission (NAICOM) has done very well in trying to sanitize the insurance industry and work very hard to ensure that the industry's contribution to GDP improved over the years.
I would like the new management of the commission to encourage new product development and collaborate with other regulators, especially those in the telecom industry, to resolve current administrative bottlenecks with a view to enabling insurance companies to market their products and services through the various service providers.
