INSURANCE cover was part of
the benefits civil service enjoyed
in Nigeria when the colonial
masters bequeathed the country’s
economy on the founding fathers
of this country. However, over the
years, it became unfortunately an
unsustainable heritage.
Recently, the Minister of Power
Works and Housing, Mr.Babatunde
Fashola is making attempt to
reinvent insurance policy when he
led the campaign for compliance
with the 2010 Federal Workmen
Compensation Act by government
contractors to ensure protection
of their workers as this would
encourage commitment and
dedication among the workers.
The 2010 Federal Workmen’s
Compensation Act, which repealed
and replaced the 2004 legislation,
makes provision for insurance
cover for workmen in respect of
occupational disease(s) (arising out
of exposure to risk factors), injuries
from accidents at the workplace or
in the course of employment.
Fashola, who was Guest Speaker
at Session Four of this year’s
National Insurance Conference
in Abuja, spoke on the “Expected
Role of Insurance in Infrastructural
development” as part of the overall
theme of “Expanding National
Resources and Infrastructure
in Challenging Times”, said he
would use his position as Minister
of Power, Works and Housing, to
insist that all the state Controllers
of Works in the country take steps
to demand and ensure that all
government contractors provide
proof of compliance with the Law.
He told the distinguished
audience at the Congress Hall
of theTranscorp Hilton, “In my
current role as minister, I can only
offer now that I will be using this
platform to insist that all our state
Controllers should take steps from
today to demand and ensure that
all our contractors provide proof
of compliance with this Law, by
taking out insurance policy for their
workers and I will do my best to
ensure compliance and protection
for Nigerian workers”.
The Minister, who wondered how
many of the various government
contractors or private companies
have such policies, added, “It
seems to me that insurance
practitioners have a role to play
here, by designing policies that
are appropriately priced and by
promptly responding to claims in
order to boost confidence in the
business of insurance”.
Speaking on the topic, “Expected
Role of insurance in Infrastructural
Development”, the Minister
said there was need for the
practitioners to be more innovative,
entrepreneurial and embracing of
the diverse needs of the country’s
“big and promising economy”.
According to him, the role of
insurance practitioners goes beyond
providing performance bonds
given to ensure that contractors
discharged their responsibility;
to embracing health insurance
that guaranteed access to the
healthcare facility that was built as
well as housing programmes, which
according to him, would provide “a
potential market of opportunities
by way of performance bonds and
mortgage insurance policies as a start”.
Fashola said the time was ripe for
insurance practitioners to lead the
change they would wish to see in the
industry, pointing out that healthcare
infrastructure such as hospitals
were only the beginning of the more
important health insurance that
guaranteed access to the already built
healthcare facility.
Urging practitioners to see the
possibilities in insuring schools,
government buildings, roads and
bridges as frontiers for deepening
insurance practice, Fashola said there
is also provision for compulsory
insurance of existing buildings, which
he pointed out, would help to curtail
the incidence of building collapse if it
cannot totally eliminate them.
On how the insurance industry
could act as a change agent in the
current efforts to rebuild the economy,
Fashola reminded the practitioners
that insurance was a component
and important part of the finance
subsector. He however, expressed
regrets that the industry “has probably
played a second role to banking, and
without intending to be judgmental
has not optimized the opportunities
for growth, expansion and inclusion”.
He elaborated, “How many markets
have burned down in Nigeria in the
last 10 years? Infrastructure has been
destroyed as a consequence. How
many of them were insured? How
many were rebuilt from the proceeds
of insurance payments?”, adding
that many, if not all, of the small
business owners in those markets who
depended on small shops and stalls,
were left without redress.
Noting that although those petty
traders may have had an insurable
interest, the insurance sector seldom
has policies for that category of
people, the Minister was prompted
to ask, “How many homes have
been ravaged by flood or fire leaving
citizens without recourse except for
Government intervention, because the
houses were not insured, or belongings
such as jewelry, furniture, electronics
and so on were not insured?”
He also pointed at insurance policies
that take care of personal effects such
as laptops, phones, and cameras
that belong to people who visit high
risk areas; adding that such policies
evolved from the responsiveness
of insurance practitioners in those
economies to the emerging needs of
their young population in a way that
spoke of the entrepreneurial spirit.
“Let me ask them how many
individual personal telephones and
laptops (except perhaps corporate
policy) in Nigeria have any insurance
policy here in a country that is
reported to have over 100 million
telephone subscribers and is perhaps
the leading Internet penetrator on the
continent by size. Is this not a missed
opportunity?”, he asked.
Fashola noted that the insurance
sector was currently not impacting
on the majority of vulnerable people
for various reasons, ranging from not
designing policies that fit the needs of
the market, to the exhorbitant cost of
policies were out of reach, or as a result
of cultural resistance to insurance and
even a combination of all the issues.
Other reasons, he stated, could
include prompt payment or lack of
it, and the difficulty of claiming, as
exemplified by the need for police
reports and other related bureaucracy.
He said people may be more amenable to taking insurance policies if these
processes were simpler and more
Urging the practitioners to
demonstrate resilience in the current
efforts to rebuild the country’s
economy, Fashola declared, “We
can and we must rebuild our nation
around our resilience. If you permit
me, I will say that this is the land of
the resilient. Therefore, we must not be
defined by the existence of challenges
or even their magnitude. Rather it is
the quality of our resilience in the face
of adversity that must become our
global brand”.
“We must rebuild our nation on
foundations of unflagging resilience;
and this is the spirit with which I
address the work that needs to be done, not only with the insurance
business but with infrastructure
renewal and development”
he said, addingthat although
the nation’s infrastructure was
aging and the population has
outgrown it, it was also true
that this was the consequence
of bad choices and budgeting,
underfunding of infrastructure
and poor utilization of resources.
“Can our resilience be
oblivious to these challenges
and the enormous opportunities
that they provide to grow this
economy, creating jobs for young
people to market and sell these
policies”Fashola asked, pointing
out that every time Nigeria had
faced these challenges since
independence, including political
instability, a bloody Civil War,
Ebola and others, “some men
and women of character had
stood up to pull us back from the
brink, and worked tirelessly to
pull us back to ourselves”.
Fashola, who cited several
instances of how insurance
was deployed innovatively to
accomplish several initiatives
and programmes during his
tenure as Governor in Lagos,
expressed joy that today a lot of
changes were being introduced
to address the anomalies that
brought about infrastructural
decay. He named one of such
changes as budgeting which has
changed from an average 15 per
cent annual capital expenditure
out of an average budget of N 4
Trillion over the last five years,
to a 30 per cent annual capital
expenditure out of a N 6 Trillion
budget to start to address the
deficit in capex spending.

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