Mr. Val Ojumah, MD, FBN Life Assurance
The Managing Director of FBN Life Assurance Company Limited, Mr. Val Ojumah, has explained that the individual life insurance sector of the Nigerian insurance industry is not bedeviled by the problem of unpaid premiums.
He made this clarification in a chat with newsmen in Lagos recently, maintaining that this problem related to only group life assurance and corporate clients in life insurance businesses.
“In life insurance business, only group businesses are written on credit. Most Individual Life policies require premiums to be paid in Installments and in advance. Hence, outstanding premiums are challenges attributed to corporate clients and large group businesses,” he said.
According to him, the insurance regulator, National Insurance Commission (NAICOM) published new provisions in this respect recently even as operators expect the issue of outstanding premiums to gradually fade away with time.
The FBN Life boss regretted that insurance penetration in the country remained abysmally low with life insurance penetration below 0.3 per cent and non-life penetration slightly above 0.5 per cent.
He also confirmed that the industry in general was working on how to reverse this ugly trend saying, “the regulator and industry operators are working together to increase insurance education and awareness amongst the public.”
“Also, the regulator is encouraging operators to redesign the various products offerings to make them more consumer-friendly. The challenge of distribution remains daunting with poor state of infrastructure for premium collection. Overall, most operators have become aware that the size of the uninsured public offer great potentials for premium growth and will therefore increase penetration,” Ojumah said.
He also spoke on the operations of his company saying FBN Life had been very selective of the businesses it underwrites and the clients whose risks it accepts.
“Therefore, outstanding premiums have not been a major challenge for us. During the first 12 months of our doing business, we collected over 98 per cent of our written premiums. We believe it does not make sense to carry receivables in our books,” he boasts.
The success factor for FBN Life, according to him, had been built around “doing things differently given to the customers bespoke products at least cost. Innovation has been our watchword.”
Speaking on his firm’s product offerings, he said, they have been well received and we have brought some new excitements into the industry.
“Our products have received very wide acceptance much to our surprise and delight. All our products have been designed with the consumers in mind and have all been made to address specific gaps in the existing product offerings in the market,” he said.