‘Every family needs insurance’

Tell us about yourselfI started my insurance career in 1980 with Unity Life and Fire Insurance Company. I later moved to National Insurance Cooporation of Nigeria from there to Cooparate Bond Insurance Brokers. Thereafter I traveled outside the country to work in Gamstar Insurance Company in The Gambia. Then I came back after fifteen years […]

Tell us about yourself
I started my insurance career in 1980 with Unity Life and Fire Insurance Company. I later moved to National Insurance Cooporation of Nigeria from there to Cooparate Bond Insurance Brokers. Thereafter I traveled outside the country to work in Gamstar Insurance Company in The Gambia. Then I came back after fifteen years and I am now working a s a consultant to African Alliance  Insurance  Plc. All my life I have been working as an insurance professional, I have never worked in any other industry aside insurance.
Did you study insurance as a course?
I studied insurance at College of Insurance, Monrovia, Liberia. The college was relocated to Gambia following the civil war in Liberia. I specialized in life Insurance and have been working in the Life and Pensions department.  
Can you explain the meaning of insurance?
When a group of people that have common risks or common problem come together and contribute small money so that those of them that will have problems arising from the various risks will now make claims and be compensated from the money they have contributed. For example if there 50 people now that have mobile phone and you discover that  once in a while someone will lose his phone, 50 of you can gather together and pay each person 10 percent of the cost of the phone to somebody to keep. That person now becomes an insurer. So that when you lose your phone, you can go to that person and say I have lost my phone and he  will  give you money to buy another one.
 
Why do you think people need insurance?
It is for family financial protection. Every family needs insurance. There are insurance for kids, those who just started life, it helps to save money for marriage ,buy car, buy piece of land, for those who are employers of labour, start business, children education to mention a few. Insurance is also a form of investment.
How does insurance benefit the family unit?
Insurance is the most effective plan any family can use. In fact insurance is all about protection. Insurance enables you to create asset when you don’t have money especially if you are a worker or salary earner and you don’t have money you can use insurance to create very big asset so that when you die you family can fall back on the asset .
For instance if you buy insurance product  plan and that will cost about one million naira you may be expected to pay 2000 naira per month once you pay the first two thousand naira you have created a market of one million. When you are no longer alive that one million is made available to your family without asking them for letter of administration or what have you because when you were alive you put the name of the beneficiary.
You can use insurance to make plans for your children’s education. When you can not raise money for your children’s education in bulk especially when they gain admission into high institution, you can start making little contribution for example if your need 1.5 million for your children’s university education you may just be expected to pay about 7, 000 naira  per month .
Once you start the first payment you have created an asset of 1.5 million. If anything happens to you once that child enters university that money is made available. Not only that if the person happens to die the child will start receiving what we call family benefit that is two percent of that 1.5 million every month depending on the age of the child for about ten years or fifteen years before the main money is made available. It is a wonderful way for one to plan for his family.
It seems people in the urban centres are more conversant with insurance than those at the grassroots. In what way for instance can a grassroots woman go into insurance that it benefit her and her family?
Insurance has been practiced over the years in our society but in very crude way. Like we have what they call age grade in the communities whereby people of the same age gather together and contribute money so that any of them that wants to marry or build house they deep hand in their money and give the person.
In the village the women gather together and go to each person’s farm to help the person. The next day they go to another woman’s farm. It is a kind of insurance, we also have people doing contributions in meetings at various level so that if something happens to a member they come to pay condolence and give you some amount.
But talking about insurance as we have it in civilized countries,  government is doing its part and we as professionals are doing our best to make sure that the common man’s risk is covered.
 Right now efforts are being made to introduce insurance as a course in secondary schools and universities and in ten years time it is expected that every family will know about insurance and talking about it.
With the challenges confronting girl child education in the country,  how will insurance help?
There are many non-governmental organisations that are encouraged  to buy children education plan from insurance companies. So that by the time it will mature  that money will now be made available for the training of the child whether you who initiated are alive or not or the NGO is no longer in existent.
There are many ways. When you don’t have money for each child and the money is paid gradually in form of a compulsory saving scheme, it will be made available when that child is up to the age of entering school.
You authored a book on retirement, ‘My Retirement my Paradise’ what tips will you give people on how to put in place what will benefit them and their family after retirement?
Before retirement I encourage every parent to have plans for their children. You  don’t need to wait or delay and then use fire brigade approach to plan for your retirement. You should start planning for your retirement the very day you start working, you should have children education plan. You also should have endowment plan. That covers the family.
You may be Managing Director of  a company but the moment you die maybe in aircraft or something, they will appoint another Managing Director and they will not allow your children to remain in that building. But if you have endowment plan there will be money for the burial and your children will be without stress.
Get plans for all your children before you retire. Pay each money by installment. If per adventure God helps your to retire you now have money to pay for your children’s school fees. Even though you are not working the money will be available.
What are the challenges of the insurance sector in the country?
The challenges are enormous. Many Nigerians look at insurance as a form of gambling. Which is a wrong notion. Insurance is established under principles which makes it not gambling but indemnity polity.
Because of the wrong notion people have about insurance when some of them have a car for instance and it does not have accident for up to three years they will  make it to have accident by themselves or sell the car and said it is stolen so that they make claims. They feel that money they are paying they should have it back not knowing that  the money does not belong to them alone but the whole group of people that have been contributing it.  But insurance always ensures those with genuine loss are given claims.
Also there was a time we had many unscrupulous people running insurance companies. Like people without any background of insurance or selling tyres at Idumota market flouting insurance companies but things have changed now.
Now to be an insurance broker you must be a professional before you are registered. There is sanity in the system, it is now highly capitalised so it is not every Dick and Harry that can set up and insurance company.
What is your advise for anyone who wants to buy insurance product now?
Insurance is safe, guaranteed, performing and paying pensions to a lot of families now. Insurance in this country is like what it is in America and other countries where it is even bigger than banks. Government has put in place things to safe guard insurance like Pension Fund Administrators (PFAs)  and organized by PENCOM if any PFA wants to mess up with people’s pension, PENCOM will now come in to instill discipline. We also have Nigerian Insurance Commission overseeing the activities of insurance companies, they also handle and even seize companies of any insurer that defaults.
Tell us about your NGO?
It is called Right Time Foundation for widows and it primarily caters for widows and their children. Ten percent of every sale of  my book ‘My Retirement my Paradise’ goes to the foundation. I have a soft spot for widows and their children because my dad died early and it became difficult for me to go to school but my mum had to struggle for us.