INVESTITURE SPEECH BY THE CHAIRMAN OF THE NIGERIAN INSURERS ASOCIATION (NIA), MR. EDDIE EFEKOHA, ON TUESDAY, AUGUST 16, 2016 AT THE GRAND BALL ROOM, EKO HOTELS & SUITES, ADETOKUNBO ADEMOLA STREET, VICTORIA ISLAND, LAGOS
Good afternoon. I am very happy to see you all make it here today despite your crowded programme. It is indeed a great honour for which I am so grateful.
First, let me take this opportunity to appreciate my colleagues in the Governing Council and all member companies of the Nigerian Insurers Association for their confidence in my ability to lead them which they expressly proclaimed by my election as the 22nd Chairman of the Nigerian Insurers Association on Thursday, June 30, 2016. It is indeed a great honour to follow the footsteps of 21 previous chairmen of our great Association, some of whom I know personally and have had the privilege to work with. It will be a rare honour for me to later in this event specially acknowledge the contributions of all these past Chairmen whose far-sightedness and courage ensured that we are here today to build on their successes.
Leadership as I know it is not about one person; it is about all of us. It is about shared vision and responsibility. I wish to assure you therefore that during my tenure as chairman I intend to work with all arms of the industry to promote the ideals of the Association.
While I invite all of us to enjoy every bit of this joyous occasion I cannot but restate that the task of leading a great Association such as ours is indeed daunting and there is work ahead to be done. I cannot pretend not to hear the various expectations of me loudly expressed since my election on June 30, 2016. May I therefore call on all my colleagues to join me in the journey of the next two years of leading the NIA.
Economic Outlook and Implications for the Industry
It is no longer news that the Nigerian economy is in a technical recession. Businesses are facing greater threats principally as a result of dwindling revenues, poor state of infrastructure, lack of power, inflationary trends in all sectors occasioned by the decline in the value of the Naira, insecurity etc. Importation and local manufacturing are currently at low ebb.
The insurance sector is directly impacted by these economic disruptions. Premium income is declining whilst claims cost and operational expenses are on the rise, thus margins are shrinking. The performance of most insurance stocks on the Nigerian Stock Exchange have been so flat that Financial Analysts have stopped including most insurance companies in their forecasts.
The times we are in demands internal cohesion and collaborative action. It therefore behooves on all of us as industry players to respond quickly to the changing dynamics of the market space so that we can remain relevant and betroth a worthy legacy to the future generation of insurers.
It is in the light of these developments in our local market that I have decided to commit the period of my chairmanship to address four critical areas in line with the theme of my administration which is “Sustainable Market Development Through Stakeholder engagement”.
Essentially, all the programmes we will be executing will find space under this central theme. These programmes, as disclosed earlier during my swearing in, include the following:
• Stakeholders Engagement
Very often insurance as an instrument for financial intermediation is misunderstood by policy makers; it is therefore necessary to enter into constructive engagement with relevant stakeholders. This will include the need to share knowledge with Judicial Officers, Magistrates and Judges on the workings of insurance business and to fully equip them to be able to respond adequately to the rising cases of fraudulent claims in the market, among other adjudication issues.
We will engage with the legislators in the process of making laws that affect the economy at large and insurance industry in particular. You will all agree with me that they are a major stakeholder whose support the industry would require at all times. The various bills before the National Assembly require concerted efforts to push through the industry position. It is only with the active engagement with the lawmakers that the industry can protect its business interests.
On tax matters, we are all witnesses to the lingering issue of the heavy tax burden imposed on the insurance industry by CITA 2007. This further strengthens the need for us as an Association to continually engage with the tax authorities with a view to amicably resolving all the issues and avoiding areas of future conflict. Let me at this juncture acknowledge and thank the Honourable Minister of Finance and the National Insurance Commission for the recent efforts made in this regard.
I will like to specially acknowledge the various initiatives of NAICOM towards ensuring a stronger insurance market. The Insurers Committee which is a platform for dialogue between NAICOM and the insurance operators on market developments and policy direction is a step in the right direction. Also worthy of note is NAICOM insistence that various Minsitries, Departments and Agencies implement extant policies on insurance of government assets. The relationship between the Association, its members and the National Insurance Commission has been cordial and it is my desire to build on the existing relationship. The Association will continue to support the Commission in its efforts to develop the market..
• Market Development & Discipline
During my tenure collaborative efforts will be made at enforcing market discipline amongst industry players. This will involve engagement with colleagues and partners in the industry to encourage market development and sustainable business practice in the industry. The Association operates under the tenets of a Self Regulatory Organization (SRO). This presupposes that it works through the instrumentality of peer pressure. We will try to build trust and provide leadership so that some of the issues of market indiscipline are promptly dealt with. Specifically the NIA under my chairmanship will where necessary work with other stakeholders to
▪ Ensure that all compulsory insurances are enforced.
▪ Explore areas of collaboration particularly on shared services with a view to reducing overhead costs
▪ Ensure that the on-going implementation of risk based supervision is continued with inputs from the Association.
▪ Review the NIA Constitution to make it more dynamic in response to the changing business environment.
• New NIA Building Project.
The Association was incorporated in 1971 and began its operations from Ajele Street in Lagos Island and thereafter, moved to NICON House at 5 Customs Street, Lagos. In September 1998, the secretariat moved to its present location. Today the Governing Council appreciates the need to have a befitting secretariat worthy of the status of the Nigerian Insurers Association. To this end, a Committee was set up in 2015 with a view to erecting a befitting edifice for the Association. It is my desire to see that this vision is actualized during my tenure. I implore all members to join hands to make this project a reality.
• Educational Endowment Fund
A proposal for the establishment of Educational Endowment Fund shall be presented to the Governing Council early during my tenure. This is in line with our commitment to promote insurance education in Nigeria by encouraging research and hard work in our tertiary institutions of learning.
I believe very strongly that none of us can attain any height without having benefitted from the support and encouragement of others. I therefore crave your indulgence to particularly acknowledge today, some special people in my life who have provided the shoulders to lean on to attain this height in my professional career. *************
Ladies and gentlemen, there is no better time than now to strengthen the Association, nay, the industry and reposition it for the task ahead.
I want to restate that the NIA has and will continue to remain true to its legacy as an institution that exists to champion the cause of the insurance industry and the policyholders. We will ensure that the founders’ sense of purpose will be upheld by us at all times by joining hands with other stakeholders to build an insurance industry that is consumer-centric.
As I and my co-travellers undertake exciting and uplifting journey we ask for your support, encouragement, advice and prayers.
To the press, you have remained a formidable partner on this journey, I will count on your cooperation and support.
I cannot end this speech without thanking the Investiture Planning Committee led by my good friend and sister, Mrs Cecilia Osipitan. Other members included Mr Edwin Igbiti, Mrs Femi Ogun, Mr Rowland Okoro, DG of NIA and his colleagues, Mr. Babatunde Daramola and Mrs Oladotun Adeogun. Thank all for packaging this event within the limited time available.
I also want to thank most profoundly my colleagues in the Governing Council for their confidence and faith in me, the Nigerian Insurers Association and the insurance industry in Nigeria.
Together we will take the NIA and the insurance industry in Nigeria to greater heights.
Finally, my appreciation goes to the Board, Management and entire Staff of Consolidated Hallmark Insurance Plc, my primary constituency that provided me with the pedestal with which I was able to attain this lofty height, to the Glory of God.
Thank you and God bless
Eddie A. Efekoha