NAICOM Urges Insurance Sector to Embrace Innovation and Technology
By Patience Ikpeme
The National Insurance Commission (NAICOM) has emphasized the need for the Nigerian insurance industry to embrace technology and innovation to adapt to the rapidly changing economic landscape.
This call was made by the Commissioner for Insurance and Chief Executive Officer of the National Insurance Commission (NAICOM), Mr. Olusegun Ayo Omosehin who was represented by the Head, Lagos Control Office Mr. Julius Odidi at the INSURANCE MEETS TECH (IMT) 2024 event in Lagos on Friday.
Mr. Omosehin highlighted the critical role technology must play in transforming the sector into a one-stop shop for insurance products and services.
Mr. Omosehin underscored that the current realities of economic instability, climate change, rapid technological advancement, and shifts in consumer behavior demand that the insurance sector evolve swiftly to remain relevant. He cited soaring inflation and forex instability, both locally and globally, as major disruptors that are reshaping financial services, including insurance.
“Innovation and sustainability are some of the major emerging issues today. We must imbibe technology to ensure that we have a seamless, one-stop shop for insurance products and services,” Mr. Omosehin stated. “The financial services sector has already embraced innovation, and the insurance industry must not lag behind.”
Mr. Omosehin pointed out that the Nigerian insurance sector must urgently adopt innovative approaches to cope with the challenges presented by the evolving economic and technological landscape. He stressed that the rapid pace of technological advancement has altered consumer preferences, tastes, and lifestyles, and the industry must develop products that cater to these changing demands.
“Innovation is now the driving force in financial services, and the insurance industry must follow suit to keep up with market changes,” the NAICOM boss emphasized. “We need to offer products that not only meet the current demands of our market but also anticipate future trends in consumer behavior.”
As the Nigerian economy continues to expand, approaching the $1 trillion mark, Mr. Omosehin noted that revitalizing the insurance industry is critical to ensuring that the sector can adequately risk-manage the nation’s growth and productivity. He described the insurance sector’s role as pivotal in de-risking activities across industries that will galvanize economic growth and development.
The NAICOM Commissioner also touched on the importance of ensuring that insurers have sufficient capital to manage the risks associated with a growing economy. With the rapid changes in the economic and business environment, Mr. Omosehin urged the industry to scale its capital base to keep up with the demands of managing risks in a $1 trillion economy and to compete effectively with global counterparts.
“Having sufficient capital that is commensurate with the risks being underwritten is no longer optional. It has become inevitable if we are to meet the consequences of a growing economy,” he said. “The insurance industry must rise to the challenge and ensure that we are well-prepared to manage the risks that come with Nigeria’s economic growth.”
Mr. Omosehin reiterated that the discussion at INSURANCE MEETS TECH 2024 was not only timely but essential in reawakening the industry to the realities of what is expected in today’s market. He stressed the need for stakeholders to work together to ensure that the insurance sector adapts to the demands of the modern economy.
One of the key points emphasized during the event was the need for the Nigerian insurance sector to fully integrate technology into its operations. This would ensure a more efficient and user-friendly experience for consumers, many of whom have shifted their preferences to digital services.
“Consumers are increasingly seeking convenience and seamless access to financial products. The insurance sector must be proactive in meeting these needs by developing products that leverage technology,” Mr. Omosehin remarked. “We need to embrace technology not just to keep up with the times but to stay ahead and provide solutions that truly meet the needs of the Nigerian market.”
He further emphasized that adopting a customer-centric approach, supported by technology, would not only improve consumer satisfaction but also help the industry tap into new market segments and boost overall growth.
As Nigeria continues to pursue its ambitious economic growth agenda, the insurance sector’s role in supporting this vision cannot be overstated. Mr. Omosehin highlighted that the insurance industry must position itself as a key player in driving the nation’s economic transformation by providing risk management solutions that support productivity and innovation across various sectors.
“The growth of Nigeria’s economy presents both opportunities and challenges for the insurance industry. It is our duty to de-risk the activities that are expected to drive productivity and economic development,” he said. “This means developing innovative insurance products that can cater to the needs of businesses, investors, and individuals who are fueling Nigeria’s economic growth.”
He urged stakeholders in the insurance sector to rise to the occasion by embracing the changes needed to compete effectively in the global market, particularly in terms of risk management and capital adequacy.
