The Nigerian Woman Insurance Protection
It is a well known fact that insurance penetration in Africa is low; in Nigeria less than 1 percent of the population is insured. With regards to female clients, Chief Client Officer at AXA Mansard, Rashidat Adebisi added granularity at the Insuretech Business Series webinar in July 2021; It is even worse for women, when they look at their portfolios in some companies. For us at Axa Mansard, women contributed 20 percent of our portfolio when the report was done in 2017…”
It is staggering that only one out of every five Nigerians who insure is female. My comparative case study below explores the situation. Please note that names mentioned are fictional characters.
Scenario 1
In the UK, Fiona, a primary school teacher, wanted a family home and took out a mortgage. A bank lent her the money to buy a 3-bedroom duplex and pay back an affordable amount monthly over a period of 25 years. As part of the loan agreement, Fiona had to purchase life assurance cover.
Sadly, 20 years later Fiona passed away and the repayments stopped. The life assurance policy was triggered and the Insurance company paid the outstanding balance owed to the bank. The ownership of the family house seamlessly passed to Fiona’s nominated dependants without any further payments.
Scenario 2
In Nigeria, Funmilayo, also a primary school teacher, wanted a home of her own after renting for many years. Her job was poorly paid but via thrift, work cooperatives and various side hustles Funmilayo gathered enough to buy a small piece of land and started the construction of a 2-bedroom bungalow. The pace of work was slow because of the difficulty in sourcing the funds whilst the builders took full advantage of Funmilayo’s lack of knowledge of the building industry.
Funmilayo’s best friend Nkechi suggested a life assurance policy as well as property insurance. Her response was stark – ‘Jesus is my Insurance!’. She couldn’t fathom paying money which would neither give her a tangible product nor return her contributions.
Four years later, the roofing of the property just started when Funmilayo tragically died. The building was abandoned, Funmilayo never got to live in her own home. Her sad demise also meant that the rent for her family ceased and they were evicted.
The reality:
Fiona got a family home to live in from day one without having to go through the hassles of construction; a stable income and an organised credit culture allowed her to make monthly affordable repayments. Life assurance gave peace of mind to Fiona’s dependants as they were not rendered homeless when the mortgagee passed away.
Funmilayo, on the other hand, had the arduous task of sourcing large sums of money plus overseeing construction; an industry she knew nothing about. There was no assistance from government or a corporate body. Her dependants were left in a perilous condition when she passed on.
Read also: To sustain economy govt must prioritise insurance
Summary
In developed countries, when an incident occurs e.g. flooding or a fire the government steps in to provide succour. To lessen this financial burden, the risk is transferred to insurance companies.
In developing countries, basic structures that protect life and limb are not really there. There is no credit culture and purchasing power is out of the reach of the vast majority especially women.
Furthermore, even as a Christian, I recognise that one of the obstacles to insurance in Nigeria is blind faith – our default setting is the miraculous and the mystical. How do we, insurance professionals, convince women in Nigeria and other developing countries to insure? A few thoughts on the basics:
a. Create campaigns targeted at women. These campaigns need to recognise the fundamental needs of women – a secure home and protection for our families in a society where female livelihoods are precarious.
b. Employ more women as frontliners. Traditionally insurance salesmen have usually been that – men. We need to train more women to be ambassadors of insurance to female clients.
c. Have protection ambassadors at grassroots level. This strategy has worked well in the public health sector and was key to the recent eradication of wild polio all over the world.
d. At the other end of the spectrum…go digital. Young Nigerian women have fully embraced technology and are participating greatly in savings and investments on apps.
e. Simplify policy wordings. Very few people read terms and conditions; expecting a barely literate population to do so is delusional.
f. Make good on insurance promises. Sales people and advisers must offer products that best suit the client’s needs and the claims process must be simplified.
g. Advertise the success stories. The insuring public are reassured when they see that real people are truly being assisted by insurance.
Each area will need intentional strategy and the commitment of the insurance industry. Commit to women’s protection and watch the nation’s fortunes change.
