AI central to Nigeria’s insurance future

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The regulatory body for insurance in Nigeria has acknowledged Artificial Intelligence (AI) as being key to the future of insurance business in the country.

The Commissioner for Insurance/CEO, National Insurance Commission (NAICOM), Mr Sunday Olorundare Thomas, stated this in a keynote address at the eighth national conference of BusinessToday, held in Lagos, with the theme, ‘The World of AI: How Insurance and Pension Sectors Can Explore Opportunities for Market Penetration.’

Thomas urged insurance operators to increase adoption of AI as it offers better productivity and enhance profitability, while ensuring quick service delivery and claims payment to insurance consumers.

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Represented at the conference by the Deputy Director, Lagos Office of NAICOM, Ajibola Olabisi Bankole, Thomas pointed out that technology adoption is part of the 10-year roadmap of the insurance industry.

Thomas added that NAICOM, as a regulator, will continue to evolve policies that will engender the growth of the industry, increase penetration and contribution to nation’s Gross Domestic Product (GDP).

President, Chartered Insurance Institute of Nigeria (CIIN), Mr Edwin Igbiti, in his goodwill message, said growing insurance industry will require the nation’s economy to be de-risked, while seeking partnership with government and other stakeholders to deepen insurance penetration.

Igbiti informed that AI will enhance the growth of insurance premium, service delivery and enable the insurance sector to contribute more to the country’s GDP.

The chairman of NEM Insurance Plc, Mr Tope Smart, who chaired the conference, expressed concern over the level of insurance penetration in Nigeria when benchmarked with the global standards and blamed it on many factors.

According to him, although the industry is working assiduously to partner agencies responsible for enforcement so as to increase insurance adoption, the lack of, or low enforcement is affecting the adoption of compulsory insurances.

Smart said, “It is quite saddening that out of a population of 200 million, only about three million people are actually insured. Lack of enforcement is a challenge but the industry is working round the clock to increase enforcement through the regulatory and enforcement bodies.

“Consumers apathy due to bad experience they have had in the past is affecting policy renewals but I can assure Nigerians that there are various complaint avenues for people to lodge complaints. If your legitimate claims are not settled, you can approach Nigerian Insurers Association (NIA) and NAICOM and if your complaints are genuine, they will be definitely resolved,”

The Managing Editor of BusinessToday Communication Limited, Mrs Nkechi Naeche-Esezobor, while welcoming the guests, said that the theme of the conference provided ample opportunity to deliberate and fashion out strategies that both the insurance and pension sectors can deploy to enhance consumer value, service delivery and further deepen market penetration.

She noted that the Nigeria’s insurance industry reached N1 trillion premium income target last year, which is a milestone that could rise faster with the right technology, including AI.

Naeche-Esezobor said, “AI is transforming insurance industry, especially in underwriting, customer support, advertising, claims and fraud prevention.”

According to her, in pension industry, just by simply automating various aspects of pension management from data analysis to investment decision-making, AI minimises the need for extensive human intervention, adding that savings can be passed to pension holders to enhance their overall returns.