Insurance

Insurers riding on technology amid COVID-19 to boost profits

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The Nigerian Insurance industry has proved most bookmakers wrong as operators have continued to reap huge profits amidst COVID-19 pandemic, a development made possible with the deployment of technology to run their operations. Chuks Udo Okonta, in this report examines how technology has helped propped insurance business and benefits achieved so far.

“Wonders shall never end”, could be best used to explained how the Nigerian insurance industry through the deployment of technology to execute their operations, were able to generate huge profits amidst COVID-19 pandemic that shutdown most businesses across the globe.

At the peak of COVID-19 pandemic, nations across the globe were lockdown, making it impossible for most businesses to operate. But for the insurance sector, irrespective of the lockdown measure placed by the government, businesses continued with the help of technology. Policies were sold through digital platforms and claims also settled.

Although, there are still more grounds to recover in order to place the insurance industry in its right position in the scheme of things in the economy, the deployment of technology for transactions amid the pandemic has helped enlarged the frontier of the sector as data obtained from the Nigeria Insurance Digest 2020, published by the Nigerian Insurers Association (NIA) revealed that the industry generated a gross premium of N508.4 billion in 2020 when the pandemic was ravaging the globe, as against N408.8 billion in 2019. The industry’s total Profit Before Tax (PBT) stood at N63 billion, Profit After Tax (PAT) was N62.0 billion, Shareholders’ Fund, N519.4 billion; Total Assets N1.9 billion and gloss claims paid, N224.0 billion. Most of these feats were made possible, through reliance on technology, the Chairman, Nigerian Insurers Association, Ganiyu Musa, said.

Sunday Thomas

Regulator’s perspectives

To effectively regulate the industry, the National Insurance Commission (NAICOM) leveraged technology to execute its regulatory responsibilities.

The Commissioner for Insurance/ Chief Executive Officer, NAICOM, Sunday Thomas, noted that the rapid changes brought about by the COVID-19 pandemic in many fronts had drastically opened doors of opportunities for many positive thinking minds and created serious setback for many who are not able to cope with the speed at which some of these changes appeared.

According to him, an obvious example was the technological advancement in the insurance industry which has been accelerated by the COVID-19 pandemic compelling many of practitioners to shift from the traditional ways of conducting business to more sophisticated and technology driven mechanisms.

“Indeed, I am able to address stakeholders virtually because of technological advancement popularised by the advent of the pandemic. While it has not been so difficult for some companies to adapt to the new world order, a lot of other companies have been struggling to cope,” he said.

Thomas maintained that the Commission on its part successfully launched the NAICOM Portal on 1st September, 2021 deployed to ensure effective and efficient interface between the Commission and its stakeholders, stressing that the Commission had since directed all operators to integrate their operations with the portal, as it was imperative to noted that any company that is lagging behind in this regard was inadvertently phasing itself out of business.

“Your respective attitude towards information technology funding in your various companies will go a long way in determining the longevity and existence of not only the companies, but the retention of the brand names or corporate identities. This is food for thoughts,” he submitted.

Thomas posited that the work-from-home trend which is gradually becoming the norm heightened the need for digitisation in the Nigerian insurance industry, adding that insurance companies are now deploying technology for remote working to enable companies to expand their mode of delivery of products and services to customers.

“In this vein, the Commission is working on an insurance industry IT framework including cyber risk and security requirements to safeguard the confidentiality and personal data of the insuring public.

“In response to the changing environment, phase 1 of the NAICOM Portal which is intended to capture all insurance policies issued across the country and also provide a link with the Commission’s licensing and other authorization processes has been concluded and has been deployed. The Commission is also currently working assiduously to conclude the digitization of the operations of the Commission’s support departments,” he said.

Ganiyu Musa

Operators’ perspectives

To ensure all operators embraced technology to enable them promote their operators, the Nigerian Insurers Association, provided the required leadership, whilst promoting the inherit benefits the industry would gain by relying on technology, especially amid challenges thrown-up by COVID-19 pandemic.

Chairman of the NIA, Ganiyu Musa, stated that at the very beginning, when the pandemic started in Nigeria, he was genuinely worried about the impact the virus and the lockdown would have on insurance customers and insurers’ businesses.

“The truth is however, over the months, we have all adapted so well. The use of technology has been the main lever of our adaptation. The Annual General Meeting (AGM) of Nigeria Insurers Association (NIA) where I was inaugurated was a great example of this. If anyone suggested a year ago that we could hold a virtual AGM, we would all wonder about how this would work but it did and life moves on.

“We have been holding meetings online and sharing documents electronically. Many of us have become experts in using all these tools and gadgets and I haven’t seen any downturn in output from all the committees and bodies I am a member of. So in summary, as much as the pandemic has introduced some challenges, it has not diminished our capacity to strive towards our goals,” he submitted.

Ganiyu Musa, who is also the Group Managing Director, Cornerstone Insurance Plc, posited that work flow efficiency is critical in driving growth and sustainability, stating that this was why Cornerstone Insurance attaches a lot of importance on technology.

“What we have done is to invest on technology which enable us engage effectively with our partners including brokers, and this has reflected in our positive performance over the years.

According to him, the COVID-19 pandemic and lockdown did not have too much impact on the company in terms of business continuity because of its huge investment in technology before the pandemic.

Muftau-Oyegunle

Knowledge supports

The mandate to feed the industry with professionals rest mainly on the shoulders of the Chartered Insurance Institute of Nigeria (CIIN). Knowing the essence of technology in times like this, the institute aligned most of its training on adoption and deployment of technology so as to fully equipped insurance practitioners.

President of the CIIN, Dr. Muftau Oyegunle, maintained that it is impossible to talk about the changing world of insurance or even the financial sector in general, without talking about technology especially, Artificial Intelligence, stressing that AI is fast becoming the order of the day as organisations seek to build leaner but more effective teams.

According to him, every business firm in the 21st Industry must leverage technology to simplify its business strategies and processes especially now that the pandemic has forced business executives to do things differently.

“The future that AI promises for insurance is a series of touch less processes from premium collection through the entire value chain until claims processing. This is evident by the numerous startups, as well as IT and insurance giants massively investing and offering increasingly innovative new solutions.

“It is imperative for market stakeholders to be at the cutting edge of technology and to equip themselves with the appropriate tools required for performance. The purpose of insurance is to enable risk-taking, support economic growth, encourage innovation and ultimately to enhance the resilience of the society and economy.

“Consequently, there is a need for us as individuals, professionals, and organizations to aggressively equip ourselves with skills and knowledge that would ensure we have the best assets. This implies that we must groom world class manpower for improved performance and growth of the industry. With the increasing digitalization and ‘low touch’ system where human input is at its minimal, professionals need to meet the emerging demands for specialized skills,” he said.

Digital innovations by companies

Several companies have deployed state-of-the-act digital platforms to enable them seamlessly execute their underwriting operations. Prominent amongst them are AIICO Insurance; Leadway and Sovereign Trust Insurance.

AIICO MD Babatunde

AIICO Insurance digital solutions

AIICO Insurance Plc remains at the forefront of digital innovation with the launch of a solution to aid easy distribution of its products and services. The solution christened: ‘AIICO Express’, is a one-stop mobile application for agents to serve customers better and faster.

The firm’s Head, Strategic Marketing & Communications, Segun Olalandu, said AIICO Agency salesforce can leverage the power of the mobile apps to conclude multiple transactions on their phones. In addition, the secure app offers them a significant opportunity to carry out their business in a flexible, efficient, and convenient manner.

The mobile app, he said was custom-built for the agents and it has numerous features to support their sales efforts, adding that these features include premium calculations, claims processing, transaction monitoring, policy listing, proposal listing, commission calculations and statements, quote generation, among other exciting and value-adding functionalities. AIICO Express was built with the capacity to perform both online and offline functions; a very important feature in a market like ours, he said.

Commenting on the solution, the MD/CEO, Babatunde Fajemirokun, said, “The launch of AIICO Express is in line with the company’s mission to provide the most compelling customer experience to our fast-growing customer base.

“Our agents are key stakeholders in reaching these customers and penetrating the complex insurance market terrain in Nigeria. As an agile organization, we are confident that our digital transformation roadmap aligns well with the realities of our market. AIICO Express will boost our agent’s capacity to provide seamless service to both new and existing customers.”

He added, “Investing in innovative technologies to better serve our customers is part of our mission. We will continue to deploy technologies that will differentiate us as a business that is committed to delivering superior customer experience.”

The company also within the period launched another solution named ELLA, which is a dedicated instant messaging service with built-in features that help customers make instant purchase or renewal of policies, claims reporting, product and service enquiries and lots more via WhatsApp, Facebook Messenger and Telegram.

Olalandu, noted that AIICO was the first insurance company in Nigeria to deploy an AI-powered (Artificial Intelligence) service via the WhatsApp platform.

He said Ella is available 24/7 and that the interactive chatbot enhances user experience as it takes on the personality of a young, intelligent, and efficient Customer Experience Manager. It helps reduce the time required for customers to purchase or access customer support service to a maximum of five (5) minutes. Furthermore, it empowers both existing and prospective customers to chat with AIICO for instant responses any time of the day. Even more impressive, the service offers simple, secure, and reliable messaging at zero cost.

Fajemirokun, said: “Our customer-centric approach essentially drives the launch of Ella and deployment on WhatsApp. With over 2 billion WhatsApp users globally and its increasing viral adoption locally, we believe it is an appropriate channel by which we can bring service closer to our customers.

“We understand how technology is transforming the world today and its impact on the lifestyle of our customers. Therefore, we will continue to invest in the best technology solution to provide our customer with a great experience.”

In the heat of the 2020 pandemic and global lockdown, the Company mitigated the impact by deploying technology-enabled solutions for business continuity. “The great feedback from our customers and the marketplace is why we are laser-focused on quality service delivery irrespective of daunting challenges”, he added.

Managing Director STI, Plc, Soyinka

Sovereign Trust Insurance digital solutions

Sovereign Trust Insurance Plc, in a bid to make insurance products and services available and affordable to a larger number of Nigerians home and abroad, introduced a Mobile App and USSD code to the Nigerian insurance market.

The Head of Sales & Corporate Communications for Sovereign Trust Insurance Plc, Segun Bankole, said having identified technology as a veritable game changer in the insurance industry, the firm has taken the bull by the horns to latch unto the opportunities of advancing her retail products and services with the Mobile App and the USSD code.

The Executive Director and Divisional Head, Technical, Jude Modilim enumerated the benefits of the Mobile App and assured the insuring public that they are in for a good time and a memorable insurance experience within the confines of their homes anywhere in the world.

Parts of the benefits of the Mobile App include, easy purchase of insurance policies such as the Third Party Motor Insurance, the personal accident insurance cover with the acronym, SWIS-F, (Sovereign Wellbeing Insurance Scheme for the Family), marine insurance and the All Risks Insurance Cover.

With the Mobile App, customers can easily access information on-the-go. It is an easy and faster way to submit and track customers’ claims.

The Mobile App was also designed to help customers manage their insurance policies. Customers and agents can also make use of the insurance wallet on the Mobile App while there is also the availability of pins and wallets for agents and brokers in carrying out their transactions on the Mobile App.

Other benefits include, automatic and immediate updating of records on the Nigerian Insurance Industry Database, NIID. Renewal notifications and reminders of insurance policies are also part of the unique benefits of the Mobile App.

On the other hand, the company’s USSD code *1015# needs no internet connection or data for designated insurance transactions. The code is easy to remember and available at all times of the day. There is an in-built security to protect customers’ details. The USSD code works with all types of mobile phones globally. It has intuitive menu with real-time interactivity and it is very economical. Its two-way communication is up to seven times faster than SMS.

The Managing Director/CEO of Sovereign Trust Insurance Plc, Olaotan Soyinka added that the two technological additions from the company are geared towards enhancing customers’ experience and ease of insurance transactions under the stable of the Underwriting Firm. He further added that the company will constantly look for ways in delighting its customers both at home and in diaspora.

Tunde Odukale

Leadway Assurance Company digital solutions

Leadway Assurance Company Limited, also unveiled a fast, convenient, and effortless process for customers to obtain its Comprehensive Motor Insurance policy in just two minutes.

The solution affords vehicle owners a fast end-to-end process of buying comprehensive motor insurance all within 120 seconds. The new platform provides the guarantees of restitution in the face of risks whilst meeting the country’s legal requirement for vehicles and vehicle owners’ insurance.

Speaking on the platform, Head of Retail, General Insurance, Leadway Assurance, Umashime Oguzor-Doghro, noted that the unveiling of the disruptive process not only aligns with the brand’s continuous drive to deepen insurance penetration in Nigeria but also provides customers with convenient access to a critical risk mitigation tool.

“This strategic solution provides a win-win solution for the critical stakeholders in the insurance space – the public, insurance industry and the country at large – convenience for vehicle owners, increase in insurance products uptake for the industry and adherence to the legal auto-insurance requirement as obligated in the country”, she said.

Adeyinka Aderombi, Head, Digital Transformation at Leadway Assurance, further added, “In understanding the criticality, limited availability of time and its impact on the quality of our wellbeing, especially in today’s modern and fast-paced world, it has become imperative for service providers to incorporate time-saving tools which aid convenience, speed, and ease as a unique selling proposition in product and service offerings. At Leadway Assurance, we believe in not just providing our customers with innovative solutions to risks, but also disentangling every possible hindrance capable of disrupting customers’ ease of access.”

The Leadway Comprehensive Motor Insurance provides the policyholder with an affordable premium, the most comprehensive cover against fire, theft, third-party damages to properties and vehicles caused to the insured vehicle, as well as coverage against bodily injury and even death.

The additional benefits include up to N1,000,000 cover for accidental damage to the insured vehicle or property, a limit of N1,000,000 for total or permanent disability to the insured and a limit of One hundred thousand Naira in the event of hospitalization or severe injury.

To access this policy in quick and simple steps within 120 seconds, visit the website auto.leadway.com on any device, input your Vehicle Registration Number and Valid Means of Identification, make payment; the certificate of insurance will be sent to the provided email address. Terms and Conditions apply.

Insurers financial performance

Amid the COVID-19 pandemic, AIICO Insurance Plc audited results for the year ended 31 December 2020, showed that the gross written premium grew by 23.6 per cent year-on-year to ₦62.0 billion in full year 2020 as against N50.1 billion recorded in 2019.

Commenting on the results, Babatunde Fajemirokun, the Managing Director and Chief Executive Officer said, “The pandemic caused fundamental assumptions about the global marketplace to be questioned and led to a global economic upheaval. The Nigerian economy slipped into its second recession in five years, with the business environment further impacted by incidents of civil unrest. Despite these unprecedented macroeconomic disruptions, AIICO grew its total assets by 52.5 per cent in the year under review. We delivered sound results having taken decisive early actions to protect our workforce, improve our financial strength, streamline operations and reinforce our distribution strategy.”

Leadway Assurance

For Leadway Assurance Limited, its profit before tax grew from N9.6 billion in 2019 to N11.4 billion in 2020.

Its total assets recorded 32 per cent growth from N396 billion in 2019 to N523 billion in 2020.

Ojumah

FBNInsurance Limited

FBN Insurance Limited, 2020 financial report showed that the group recorded an improvement in net premium income at eight per cent year-on-year growth from ₦39.2 billion to ₦42.5 billion in 2020. Total assets of the group increased by 47 per cent from ₦116.0 billion to close at ₦170.0 billion as at 31 December 2020.

Further analysis showed that the company achieved 25 per cent growth in its Profit After Tax (PAT) in 2020, translating to N9.9 billion as against N7.9 billion recorded in 2019.

Ojumah, while reviewing the company’s performance for the year, said: “we remain adaptable and responsive to the unfolding trends, modifying our plans and operations in a manner that would ensure that we achieved our strategic objectives. 2020 was a challenging year due to the outbreak of the novel coronavirus, but we witnessed an impressive growth along key metrics and across major lines during the financial year.”

Ojumah, disclosed that despite the challenging operating environment in the country, the company closed the year with positive results and made prompt claims payment to customers.

MD/CEO Universal Insurance Ben

Universal Insurance

Universal Insurance Plc recorded a Profit After Tax (PAT) of N624,647 million at the end of financial year 31st December 2020.

Board Chairman, Gen Joshua Dogonyaro! said the firm’s Profit Before Tax (PBT) rose from a loss position of N322,863 million in 2019 to N637,949 million in the year under review.

Tope Smart

NEM Insurance Plc

NEM Insurance generated a gross premium of N22 billion in 2020 as against N19.8 billion generated in the preceding year 2019; an increase of 12 per cent, its Chairman, Dr. Fidelis Ayebae, has said.

He said the company’s net premium earned during the period under review was N15.8 billion and 25 per cent increase over the preceding period of 2019 which recorded N12.6 billion.

He remarked that while the group’s Profit After Tax (PAT) for the preceding period was N2.4 billion, the sum of N5.08 billion was recorded in the reporting period; an increase of 112 per cent.

He stressed that during the period under review, over 55 per cent of the firm’s employees attended various online trainings to enhance job performance, adding that the company adapted to online trainings in response to the restrictions on physical gathering. due to the pandemic.

The Group Managing Director, Tope Smart, said the firm’s profit during the period grew significantly from N2.4billion to N5.1billion, a growth of 112 per cent and he expressed gratitude to all brokers and clients for their unalloyed support over the years.

Insurers dependence on technology to boost their operations amid COVID-19 pandemic and positive results in terms of increased profits, underscored the fact that the insurance industry would do more if the practitioners fully automate their operations. The pandemic in spite the negatives associated with it, also brought about some positives especially in forcing most businesses to embrace technology which resulted in aiding growth of the sector’s business.

As the insurance industry grapples with the challenge of deepening penetration, full reliance on technology would really help in getting mass of the population into believing and embracing insurance products and services.

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