Findings have revealed that the number of indigenous insurance companies acquired by foreign investors will soon rise to 12. Information obtained from the National Insurance Commission on Friday showed that 10 foreign firms had already acquired Nigerian underwriting firms and two were about to be taken.
According to NAICOM, “there were three foreign acquisitions into the sector in 2014; two in 2015; five in 2016 and two companies are now in progress,”
The Commissioner for Insurance, Alhaji Mohammed Kari, had said that the Nigerian development plan vision 2020 described the Nigeria insurance sector as a grossly untapped opportunity with low market penetration.
He said, “The foreign investors, having noted these great opportunities, are attracted by the huge potential in the Nigerian insurance space. The investors are ready to position themselves for the future, hence the likes of AXA, Prudential, Liberty, Swiss Re, SUNU Group, Saham, have taken positions in the industry and in partnership with indigenous companies for development and growth.”
Despite that, he said that the growth of the Nigerian insurance industry was hinged on right products, innovation, prompt claims payment and healthy competition between local players and their foreign counterparts.
He said that it was noteworthy to see that insurance entities had been working hard to clear some of the misconceptions inhibiting insurance penetration and growth by planning massive sensitisation campaigns across multiple communication channels.
According to him, once consumers understand and value the actual benefits of insurance, the Nigerian insurance industry will grow sharply and prosper, as it has been the case in many other countries.
“The presence of foreign insurers in the Nigerian market is another incentive expected to boost penetration, technical capacity and service delivery,” he said.
The Chairman, Nigerian Insurers Association, Mr. Eddie Efekoha, also observed that the insurance industry was becoming more attractive to foreign investors.
He said, “The indices are clear. If you look around, you will see that a lot of our friends from outside Nigeria are looking at Nigeria and if they are doing so, then you don’t need any one to tell you that there is something good about us or potential they are seeing.”
However, some operators revealed that the insurance companies acquired by foreign investors in recent years had not fared better than the indigenous companies generally.
However, they added that they were optimistic to see how the new investors would boost activities in the sector.