Excellent Customer Service, Products Innovation, Key To Insurance, Pension Growth – Adedipe
L-R: Mrs. Joyce Ojemudia, MD/CEO African Alliance Insurance; Mr. Ganiyu Musa, Chairman, Nigerian Insurers Association (NIA) and Chairman of the Occasion and Mrs. Nkechi Naeche-Esezobor, MD/CEO BusinessToday Communication at the 6th Business Today Conference in Lagos
The Chief Consultant of Biodun Adedipe Associates, Dr. Biodun Adedipe said for the insurance and pension sectors to experience the required growth that will enable them to contribute significantly to national development, operators in the two sectors must be innovative in the development of their products as well as imbibe customer services excellence.
Adedipe said this while delivering a theme paper “Prioritizing Excellent Customer Services in Insurance and Pension Businesses” at the 6th Business Communications Conference in Lagos recently.
Adedipe who emphasized the need for products innovation and priority to excellent service delivery by insurance and pension operators noted that the type of product you offer and the service you render will determine whether your customer will come back or not.
He laid emphasis on what the operators in the two sectors can do to win customers and retain them; how they can keep the customers and serve them with the best cost management so that they can still remain profitable.
He said for them to retain their customers, they must know that they are not in business to sell products but to provide solutions to customers’ problems, adding that what customers need is peace of mind.
According to him, “When a customer is complaining the message is not that I want to leave to somewhere else, the interpretation of customer complaint is that I want you to improve.
“When customers are complaining, therefore, don’t treat it as antagonism but that they are telling you they want to go elsewhere. Every complaining customer is passing a message to you to improve. The ones that want to go away won’t complain to you.
L-R: Mrs. Nkechi Naeche-Esezobor, MD/CEO BusinessToday Communication; Chief Consultant, Biodun Adedipe Associates, Dr. Biodun Adedipe, theme speaker, and Mr. Ganiyu Musa, Chairman Nigerian Insurers Association (NIA) and Chairman of the occasion
“What we should do to win customers and retain them is to meet their needs and what they need is peace of mind, not the product you are selling,” Adedipe explained.
He said it is not easy to get a new customer and that it is five times more costly to get a new customer than to retain the old one and charged the operators in the insurance and pension industries to give priority to excellent customer services.
Dr. Adedipe said “The fundamentals of excellent customer service include a clear understanding of who your customer is; the problems that customer want you to solve for them; how, where and when they want those problems solved; what they are willing to pay happily for the solutions offered and how much they value your relationship with them.
“You must be able to answer in clear terms the questions of what is most important to different customer categories? How can we deliver repeatedly beyond the expectations of those customers? Can we build our entire strategy, systems and operations around the customer?”
He said Relationship Management is key to service excellence, noting that it is more difficult and costlier (the cost ratio is one to five) to start relationships than to maintain them.
Dr. Adedipe said relationships can easily weaken or fizzle out if they are not nurtured; competitors will capitalize on this vulnerability to take your customers.
He posited that Strong relationships translate into greater business volume through repeat purchases and new introductions “Which over 10 years can translate into 14 times the current business volume.”
Adedipe said People are important to every entity, whether public or private. They are our contact point, they are the ones we market, and they are the real buyers.
“The people that insurance companies and pension administrators serve are central to their existence, survival and sustenance.
“Managing their perceptions will make or mar the practice; as such perceptions determine the choices and decisions that those customers make.
”Excellent customer service is fundamental to every organization, public or private, profit-seeking or not-for-profit. Often times however, the management and staffs of many organizations do not act accordingly. They on many occasions forget that their organizations exist for the customers; not even the founder, shareholders and directors.
”Let me put this in perspective very quickly. For governments and their agencies, they exist for the citizens and all the entities that are impact by their decisions, choices and actions. Social impact is a paramount metric for measuring their performance and effectiveness.
”For profit-seeking entities, they will achieve their profit motive and remain sustainable if the customers repeatedly patronize them, paying values higher than the cost of the products and/or services delivered to the customers.
”For not-for-profit, the value delivered to beneficiaries is the basis for attracting donations and grants.
”Let me even go more specific for profit-seeking entities, for which I have an accounting proof of how strategically important customers are to their survival and sustainability.
”Without the customer, the best financial outcome of a profit-seeking entity is a loss! Simply put, no customer, no income (at best income arising out of the investment of the excess of equity over non-current assets) but expenses will arise every day the business remains in operation,” Adedipe explained.
On insurance and pension business, he said ”both of them are peculiar in the sense that they have triple bottom-line: Gross income; Profit and Social impact. Insurance enables entrepreneurial risk taking and loss recovery for the risk-vulnerable, while pension assures sustenance after active service life.”
He said to create and keep customers in a cost-effective manner puts business down to three things namely, get the customers, keep the customers and cover the Cost of doing both, with something left to show for the efforts.
On who a customer is he said, Most people take a customer as someone who buys their product or service.
”From the strict business perspective, a customer is not just the person that patronizes your business. The right definition of customer must recognize that a company remains a going concern if customer patronage is repeated over and over again.
”As such, a customer is a person or organization that chooses to buy your product or service, preferring you to your competitors.
”As a follow-up, s/he pays for the service rendered. Most importantly is that s/he perceives that the value in your product/service is greater than or equal to what s/he pays for it.
”Any wise businessperson will work hard to build and sustain customer loyalty, which begins at creating an awareness of your brand and your product offerings,” Adedipe added.
Chairman, Nigerian Insurers Association (NIA), who was also the chairman of the occasion, Mr. Ganiyu Musa commended the Publisher/CEO of Business Today for her contribution to the growth of the insurance and pension sectors in Nigeria.
While noting the importance of awareness to the growth of the insurance and pension sector, he said “we are here today because insurance and pension education is a subject matter which is relevant to almost all aspects of our national life.”
Commenting on the capability of the theme speaker of the day, Dr Biodun Adedipe, to do justice to the topic of discourse, Musa who is also the Group Managing Director of Cornerstone Insurance Plc said, “Those of you that have had the opportunity to listen to Dr Adedipe, will appreciate the quality he brings to every conversation and the depth of his research not just in economics but in the general, social and political discourse. I am looking forward to an engaging conversation and I believe all of you here will benefit immensely from today’s occasion.
A cross-section of guests at the event.
While responding to some questions, NIA Chairman assured Nigerians that the present insurance industry is evolving and is committed to its mandates, especially in the area of claim settlement.
He said the industry has paid over N11 billion claims for losses emanating from #EndSARS protest destructions.
Mr. Ganiyu Musa said NIA being the umbrella body of all insurance and reinsurance companies in Nigeria is working seriously to ensure a high level of sanity and professionalism in the industry.
NIA as a body will never tolerate any form of indiscipline from any member. We will not spare any member that wants to drag the image of the industry to disrepute. We will discipline such members according to the constitution of the association.
“Recently we expelled two of our members who defaulted on the issue of paying genuine claim from our membership. This is to serve as a deterrent to others. This is to tell you that the Nigerian insurance industry now is far better than what you used to know or hear about.”
On recapitalization, he said NIA is working with the National Insurance Commission (NAICOM) to arrive at the statutory capital requirements for the industry and to ensure the same is reflected in the insurance industry Bill which is presently in the Senate for enactment.
He called on members of the public to always avail the NIA or NAICOM with information of bad or unprofessional misconduct by any insurance operator for investigation and appropriate action.
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