Low level of financial literacy causes low insurance penetration in Nigeria, says Insurance Commissioner
The persistence of a low level financial literacy is the cause of the low insurance penetration in Nigeria, according to Commissioner for Insurance Fola Daniel.The persistence of a low level financial literacy is the cause of the low insurance penetration in Nigeria, according to Commissioner for Insurance Fola Daniel.
He said, quoted by Vanguard: "It is a well-known fact that insurance is not very popular in our sub-region for various reasons amongst which are; low level of financial literacy, lack of adequate awareness of insurance mechanism and poor perception of the industry."
Daniel, insurance practitioners need to come together to tackle the menace. He is calling on insurance providers to help increase the focus on financial education in the region, as the lack of awareness and understanding of financial matters ultimately leaves individuals and families inadequately protected.
Managing Director of Riskguard-Africa Nigeria Limited Yemi Soladoye added
that operators often focus on how to raise their yearly premium, abandoning the need to create expansion through good services and products, as well as providing financial education.
He urged operators to initiate collaboration with cooperative societies and other relevant bodies to deepen insurance penetration.
CEO of Old Mutual insurance Offong Ambah told Leadership newspaper that his company is "spending a lot of money" on financial education to enable people to understand that "there is a need for them to insure".
He added: "It
is a job and responsibility that is very long term in nature and involves a lot of stakeholders."