Leadway Assurance: Empowering Journalists for Effective Reporting Through Capacity Building Training

Mr. Oye Hassan-Odukare, Managing Director/Chief Executive Officer, Lead Assurance Limited

Being a leader comes with enormous responsibilities and challenges and it is only those with the leadership capabilities have the potentials and the know-how to accommodate the responsibilities and surmount the challenges.

Today, the issue of growing the insurance industry to contribute meaningfully to the gross domestic product (GDP) of the country and also in giving the sector a pride of place among the comity of other sectors is a collective responsibility of all the stakeholders in the industry.

Presently, the contribution of insurance sector to the national gross domestic products is less than one percent behind other African countries such as South Africa, Egypt and Angola.

There is one insurance company in Nigeria who has pride itself as a real leader with the right leadership ability, doing so through leadership by example, playing dominant roles in all the segments of the industry. The company is Leadway Assurance Company Limited.

It is no longer news that Leadway Assurance is committed to the growth of the sector, having explored and continuing to explore various strategic approaches one of which is the company’s capacity building training workshop initiated for insurance and pension journalists covering the industry.The initiative is aimed at empowering the journalists adequately for effective coverage of the industry, because of the important role of the media for the growth of any human endevour.

The Company opines that when the journalists reporting the industry are sufficiently and adequately exposed to the know-how and workings of the various segments of the industry, the industry would be better for it.

It also believes that when the journalists are properly and explicitly informed about the activities of the industry from time to time, it would help them to give accurate and balanced reports that will help in no small measure in correcting the erroneous and negative impression some people are still having about the industry in Nigeria.

Having realised the important role that journalists play in raising the level of insurance awareness and how it works, the leading insurers in Nigeria believes that there is need to deliberately and continuously equip media practitioners with adequate training to build their capacity, expand their knowledge base for them to effectively discharge their duties for the benefit and growth of the industry especially now that that deepening penetration and growing the industry’s contribution to the  nation’s GDP is one of the cardinal objectives of the industry.

Therefore, in marching it words with action, Leadway Assurance has between October 2017 and February 2018 organised capacity building training workshop twice for Pension and Insurance Journalists in partnership with the National Association of Insurance and Pension Correspondent (NAIPCO).

The Leadway journalists training initiatives was aimed at empowering journalists in the discharge of their duties by equipping them with the requisite knowledge they require.

At the training, journalists were enlightened on the inner workings and the technicalities of the insurance sector; keeping them abreast of the latest industry trends both locally and globally.

Addressing journalists after the workshop, the Company’s Executive Director, General Business, Ms. Adetola Adegbayi, urged Policyholders who have genuine claims to always demand settlement from their insurers whenever the is occurrence.

She noted that most Policyholders are ignorant of when and how to make claims, adding that instead of going to their insurers to make claims, they resort to bearing the financial burden themselves.

Realising that some people don’t demand for claims, she said, some overambitious operators cashed on this loopholes, to rate-cut policies to unreasonable price, with the assumption that the insured will not demand for compensation.

Because of the low rate they demand on their policies, she said, they, in most cases, outbid their competitors for businesses because their rates are lower and consumers always want to go for policies with lower rates.

In the event of claims, she said, these overzealous underwriters do default, since the premium charged is not the actual value of the products and they finds it difficult to pay claims when need arises.

To this end, Adegbayi stressed that rate-cutting can be fought by Nigerians, if they begin to request for claims on their insurance policies, stating that when this happens, underwriters would sit up and charge the normal rates that can sustain them when claims arise.

She explained that an insurance company would be heavily sanctioned if it defaulted in claims obligations, she charged Nigerians to report defaulting underwriting firms to law enforcement agents, promising necessary steps would be taken to pay claims to the aggrieved insured.

According to her, policy prizing is becoming lower and the lower your policy, the riskier your business becomes, adding that, “but for the mass market products, as the volume increases, the price reduces.”

On the benefits of one of the microinsurance products of her firm, she said, Hospital Cash Insurance Plan is a cover that is activated in the event of hospitalisation of the insured person due to illness for a consecutive period of more than two days, a daily benefits is payable up to a maximum of 20 days during the policy period.

In the event of of hospitalisation arising out of accidental injury for consecutive period of more than two days, she said, a daily benefits is payable up to a maximum of 15 days during the policy period.

In this instance, she said, those under the basic plan and are hospitalised due to illness, will be getting N4,000 claims per day throughout the duration of their stay in the hospital provided it is not more than 20 days. Those under the Classic plan would be entitled to N7,500 per day while those under the Plus plan would be entitled to N10,500 per day.

She disclosed that the company also has Personal Accident Plan, which cover medical expenses arising from accident and Home Flexa-Silver Insurance Plan, saying, these were mass market policies aimed at deepening insurance penetration across the country, promising that company would not relent on its oars until most Nigerians are insured.

Earlier, the Head, Retail Business, Leadway Assurance, Tunji Amokade, had said the future of insurance industry lies in the retail market, noting that, the commercial market is saturated.

Amokade, while speaking on ‘Micro Insurance Business in Nigeria’ at the training, added that despite the huge population the country is blessed with, low insurance penetration is still a major issue.

“The problem of penetration is because we are cash-based economy unlike other countries that are credit-based,” he said. The success story of insurance in South Africa, Kenya, Morroco, and so on, he said, was as a result of their credit-based economy, stating that until Nigeria borrow a leaf from these countries, low penetration will continue.

While calling for institutional structure that allows credit to thrive, through this, he said, insurance can be incorporated into some credit-based services, thereby, increasing insurance adoption and contribution to the nation’s economy.

Charging insurance companies to offer good value for money for their clients, he urged underwriters to increase their visibility through effective use of technology as well as building more offices where there are none.

The industry has been targeting the upper class, but the market now resides in the middle and the low income earners.

Some journalists in a pose with organizers shortly after the workshop.

Media practitioners who participated training workshop have commended Leadway Assurance Limited for the laudable initiative designed to improve their skills and knowledge about the insurance industry.

Commending Leadway, the Publisher, Riskshield, Roland Okoro, described the training as an initiative that was organised at the right time when the country is in need of balanced and accurate reporting.

“This platform provided by Leadway Assurance is indeed a positive one and is a valuable platform for knowledge acquisition for media practitioners,” Okoro added.

Other participants thanked the insurance company for the innovative program. According to them, the training will go a long way in improving the quality of reportage in the media.

The participants said: “Leadway has indeed proven their position as the leading insurance company in Nigeria through this workshop.”

“This is a creative platform for learning and capacity building for journalists. The quality of what I have learnt in the aspects of oil and gas as well as marine insurance will improve the quality of the output of my work. Indeed, this is an initiative that other organizations in other industries should emulate”.

While speaking on the training, the Executive Director, General Business, Leadway Assurance, Ms. Adetola Adegbayi, reiterated the organization’s commitment to empowering media practitioners to attain world class standard in delivery of their profession.

According to Adegbayi, “the training is part of the Leadway’s contribution to improving the media sector through regular capacity development trainings.”

President of NAIPCO commended Leadway for partnering the association and taking the initiative to organize the training workshop.

“This initiative by Leadway Assurance, is a game changer which we are excited to partake in as an association. It will upgrade the standard of media practice in Nigeria and help drive positive changes through balanced and robust reportage,” Tolu-Kusimo further added.

Interestingly, Leadway Assurance Limited, the largest insurer by premium income and asset has recorded a surge in full year profit, thanks to contributions from investment income and gains in fair value asset.

As a result of the Company’s demonstrative leadership capabilities driven by the management’s passion for excellence, the year ended December 2017, Leadway Assurance’s net income surged by 82.45 percent to N13.83 billion from N7.58 billion the previous year.

A cross section of journalists at the training workshop.

The growth in profit was largely driven by 61.05 percent year on year increase in investment income and net fair value gain on assets of N7.47 billion that help  make up for the underwriting loss in the period under review.

Leadway Assurance has yielded returns higher than the risk free rate of return, the market rate of return and the inflation rate respectively as return on equity (ROE) increased to 25.0 percent in December 2017 from 19.52 percent the previous year.

Leadway Assurance paid total claims of N27.43 billion in 2017; this represents an 18.95 percent increase from last year’s figure of N23.06 billion as the insurer continues to keep to promise made to customers.

Claims ratios increased to 39.29 percent in the period under review as against 54.70 percent the previous year. In other words, the company has spent N39 in claims out of every N100 generated in premium income.

For instance, Leadway’s net premium income of N69.81 billion as of December 2017 is more than the N55.37 billion combined premium incomes of  AXA Mansard Insurance Plc, Wapic Insurance Plc, NEM Insurance Plc, Consolidated Hallmark Insurance Plc, Law Union and Rock Insurance Plc and Equity Assurance Plc.

The underwriting firm’s total assets of N283.78 billion as at December 2017 dwarfs the N251.15 billion of the above insurers.

The insurance industry contributed less than one percent to an economy of $493 billion, a figure that is abysmally poor when compared to the contribution of some Sub Saharan African countries to their economy.

Analysts say tradition and cultural beliefs are increasingly hindering the   performances of insurers as many people have refused to take insurance cover.

Also, lack of awareness about the benefits of insurance, poverty and high unemployment rate has combined to undermine the industry.

For instance, approximately 1.5 per cent of Nigerians within the insurable class are covered by insurance today, which means the large chunk of the population do not have a cover for risks they may encounter on a daily basis.

Despite the above challenges, Leadway Assurance’s gross premium income, Net premium income and net premium income increased by 84.12 percent, 57.42 percent, 69.23 percent to N84.17 billion, N84.61 billion and N69.11 billion respectively in the period under review.

According to statistic compiled by the National Insurance Commission (NAICOM), the insurance industry’s regulator, Leadway is one of the life insurance companies that control over 50 per cent of the life insurance market by gross premium in Nigeria.

Details revealed that of a total N124.56 billion gross premium received by the 22 underwriters, N67.18 billion was recorded by the three underwriters with Leadway posting N31.68 billion or 25.36 per cent.

NAICOM had said that 46 out of the 57 insurance and reinsurance companies have less than two per cent of the insurance market share with Leadway having the largtest shares in both life and non-life segment of the industry. The company controls 10.69 per cent in non-life business.