The Nigerian insurance market is a big one with a potential estimation of N300 billion annually. But should only 10 per cent of Nigeria’s 170 million population take at least one form of retail insurance product offered in the market as market analysts have said.
Yet, currently, the sector generates an abysmal N50 billion in retail insurance, given the population size and potential risk exposure in the country. This probably was what led the Commissioner for Insurance, Fola Daniel, to call for a strategic change in insurance operators marketing strategies.
“Our marketing strategy must change; our product design and packaging must change; our approach to policyholders and their complaints must change and all hands must be on deck to ensure that the message of insurance is taken to the grassroots”, Daniel was quoted to have said that.[blockquote right=”pull-right” cite=”Kola Oyeneyin, CEO, Venia Technologies”]“One of the biggest problems in Nigeria is that you buy an insurance policy and it’s fake. But the moment you buy insurance on our platform, we upload on your behalf to NIIJ platform and you get an SMS from them that you bought the right insurance from AutoGenius.”[/blockquote]
“With the old based economy, the sector barely contributed 0.7 per cent to the GDP, and with the rebasing, the contribution of the sector to GDP has dropped to 0.6 per cent. This calls for more dynamic strategies to deepen insurance reach amongst the vast populace.”
With the new entrant into Nigeria’s insurance market, Daniel’s call for new ways of doing the business for a better result may have just been answered.
Venia Technologies, on October 16, in Lagos, announced the launch of AutoGenius, a platform where users can experience better insurance service delivery within five minutes. AutoGenius is Nigeria’s first and possibly the number one mobile and online insurer.
Kola Oyeneyin, CEO, Venia Technologies, while explaining the platform, during the product launch held at Eko Hotel, said, “what we are providing is the cheapest insurance platform in Nigeria. When you come here, you’re able to buy the cheapest insurance product in Nigeria.”
Oyeneyin said in less five minutes of buying an insurance product on their website, the insurer gets his/her insurance certificate as the platform “allows you to instantly know from NIIJ whether you bought the right insurance policy or not.”
“One of the biggest problems in Nigeria is that you buy an insurance policy and it’s fake. But the moment you buy insurance on our platform, we upload on your behalf to NIIJ platform and you get an SMS from them that you bought the right insurance from AutoGenius.”
Oyeneyin explains that another innovative from AutoGenius “is that it takes the value of your car and helps you find the insurance cover at the right platform across our six partners (AIICO Insurance, Custodian & Allied Insurance, Leadway Assurance, NEM Insurance, Royal Exchange Plc. & Sovereign Trust Insurance), who have the best insurance service provider as far as we are concerned in Nigeria.
[blockquote right=”pull-right” cite=”National Insurance Commission (NAICOM)”]”National Insurance Commission (NAICOM) says that 15.5 million vehicles on Nigeria’s roads, only 2.2 million are insured. And according to the body, a larger number of the 2.2 million insured are done with fake agents. This is a big drain on the country’s economy, as analysts reported N58 billion loss in the sector to fake insurance agents.”[/blockquote]
With the entry of AutoGenius in the country’s insurance market, analyst are expectant that more auto insurance users would be motivated to buy insurance, given the safety, cheaper and the younger audience appeal initiatives it is bringing to the table. For instance, out of 105 million Nigerians (who are below the age of 35) 65 million of them are within the age range of 18 to 35 years and 30 million of this range consists of young people between the ages of 25 and 35.
Statistics has also shown that 78 per cent of Nigerians own a cell phone or have Internet access, while 83 per cent of Nigerians online engaged in social media, according to a UN report.
With AutoGenius’ drive to make insurance more fun in Nigeria, one would expect that 75 per cent of 30 million Nigerians who fall under the category of car owners in Nigeria will be properly motivated to buy car insurance.
Additionally, analysts expect that there will be a form of checkmated malpractices in the sector. It is expected that participations of operators of fake insurance should be drastically reduced, if not totally checkmated.
National Insurance Commission (NAICOM) says that 15.5 million vehicles on Nigeria’s roads, only 2.2 million are insured. And according to the body, a larger number of the 2.2 million insured are done with fake agents. This is a big drain on the country’s economy, as analysts reported N58 billion loss in the sector to fake insurance agents.
For AutoGenius to successfully checkmate malpractices in the sector, it needs provide an intensive education and reorientation campaign through mass media engagement. It will be to their advantage to partner telecommunication providers, traditional and the new media in driving an educational campaign on their products works and the needs for Nigerians to use it.
AutoGenius, being a pilot in the techsurance space, may have open up the door for other to have a slice of the cake. Insurance market is very huge and relatively untapped, as the Deputy Director of the Nigerian Insurance Commission, Mr Segun Farinu, who represented Fola Daniel, mentioned at the unveiling event.
“Insurance penetration is comparative low in Nigeria and relatively untapped. Looking at the country’s population, that is a pointer for immense opportunities inherent in this sector of the financial services in Nigeria,” he said, before announcing that the regulatory body was “pleased to note that NAICON has begun the process of fine-tuning some of its regulatory police frameworks aimed, among others, to increase insurance penetration through principle based supervision, that when completed, will open up more distribution channels and other services for the purpose of insurance market growth.”