AIICO Aims to Close Insurance Penetration Gap with Flexure
AIICO Insurance Plc has decried the low penetration of insurance in Nigeria and called for increased digital sales of insurance products and services to close the gap.
The company pointed out that Nigeria, with over 200 million people, has an insurance penetration rate of 0.5 percent only.
AIICO Insurance, which stated this at its sponsored annual training for members of the Nigerian Association of Insurance and Pension Editors (NAIPE), noted that the major mechanism in closing the gap was digital sales of insurance products.
Mr Olusanjo Shodimu, Chief Digital and Innovation (CDIO) of AIICO Insurance who spoke at the training, noted that insurance should be sold through channels that are ubiquitous and accessible to prospects.
He said: “Nigeria, which is the largest African economy with a GDP of 440 billion USD (2021) and the most populous African country with over 200 million people only has an insurance penetration rate of 0.5 percent.
“The major mechanism in closing this gap is digital sales of insurance products. Insurance should be sold through channels that are ubiquitous and accessible to prospects. The adult population is either on social media or surfing the web and they use their mobile phones to perform these activities.”
Mr Shodimu listed the challenges affecting insurance distribution to include trust, explaining that people did not believe in insurance and the need for it, except for the statutory ones imposed by the government.
He noted that another challenge was awareness due to lack of understanding and appreciation of the importance/benefits of insurance, stressing that accessibility was also a challenge as the requirements for obtaining insurance policies are too many and challenging.
According to him, another challenge was the complexity of insurance policies with legal jargon and intricate terms and conditions; these complexities, he noted could deter potential customers from purchasing insurance.
Mr Shodimu stated that to address these challenges, AIICO Insurance developed Flexure as a flexible insurance platform for the ease of distribution of insurance products and services leveraging technology.
“Flexure is AIICO’s response to the changing landscape of insurance and technology “InsurTech”. Flexure, (an acronym for “Flexible Insurance”), is a flexible insurance platform that enables fast and easy access to insurance services via an Application Programming Interface (API)-driven distribution framework and is currently in use by various industry verticals.
“The Flexure platform and API technology powers both B2B and B2C offerings, providing a differentiated customer experience and API-led product distribution that allows businesses to distribute insurance products as ancillary services and allows start-ups/Insurtechs to innovate and power new, market-leading use cases for insurance distribution, as well as direct access to insurance products for consumers,” Shodimu explained.
He said that the key feature of the Flexure was that it enabled fast and easy access to insurance services.
Also, he stated that another feature was simplicity as the Flexure streamlines the often complex and time-consuming process of obtaining insurance coverage, allowing users to access insurance services quickly and efficiently, reducing the traditional bureaucratic hurdles associated with insurance applications.
For real-time access, he noted that with Flexure, users could access insurance services in real time, a departure from traditional insurance processes that might involve delays due to manual underwriting and administrative procedures but real-time access ensures timely coverage when it is needed most.
On customised solutions, Mr. Shodimu said that Flexure offers customizable insurance solutions, which means that users can tailor insurance plans to their specific requirements, whether it is adjusting coverage limits, selecting different policy options, or modifying terms, Flexure empowers users to create insurance plans that align with their individual or business needs.
He said on scalability, Flexure is designed to be scalable, meaning that it can accommodate growing needs and user volumes without compromising performance, whether a business is small, medium-sized, or large, Flexure can adapt to its scale.