–Remi Olowude

For many people, Industrial and General Insurance Company Limited (IGI) can be used interchangably with the Nigerian Insurance market. the reasons are simple – IGI enjoys a larger than life image as it spreads its tentacles across the whole of Africa. the recently concluded consolidation programme has enabled IGI to stand out as the highest capitalised private indigenous insurer with a group total asset in excess of N20.5 billion. the executive vice chairman of the company , Mr. Remi Olowude says that the beat has just begun for IGI. Excerpts:

Having fully met the prescribed re-capitalisation levels for both General and Life businesses, IGI received on Thursday February 22nd 2007, the formal approval of NAICOM to continue operations for both General and Life Insurance businesses. IGI will carry on our general insurance business whilst our life business will be carried on by IGI Postal Life Assurance Limited.

The reality however is that IGI had met the capitalization level before the Federal Government fixed N5 billion as the minimum capitalization level for composite operators. This is because before September 2005 when the reform programme was announced, NAICOM had approved IGI’s audited Accounts for 2004, which placed our Shareholders funds at N5.1 billion. IGI was therefore the first and only company to have met and surpassed the new requirements before the new capital levels were announced.

As at December 31st 2005, our capital base was N5.42 billion. Despite this, our company came up with a capitalization programme that would increase the Shareholders’ fund to N10 billion by 2006. This programme included a Rights Issue of N725 million and a Private placement of N5.8 billion. The Rights Issue was oversubscribed and the Private placement was successful to the extent that IGI’s Shareholders’ funds jumped to N9.05 billion by December 2006.

With our acquisition of NASAL Insurance Company as well as Postal Life & General Insurance Company, and with our investment in National Insurance Corporation of Uganda, the capital base of IGI group now stands at a little above N10 billion. The Director of Finance will give a further breakdown of the facts behind the figures in the course of this interactive session.

In line with our vision to be Nigeria’s first truly global insurer, we have lined up strategies to achieve a minimum capitalization level of N25 billion within the next 24 months. This is informed by my belief which I have affirmed repeatedly in my comments on the industry restructuring, that the biggest insurer must not be smaller than the smallest bank.

As the insurer of choice in the past 10 years to major players in the key sectors of the Nigerian economy - including Oil and Energy, Construction and Engineering,

Telecommunications, Aviation and Marine sectors, we are fully prepared for the challenges and opportunities of the post-consolidation era. We realize that whilst financial strength is key to competitiveness, we can only sustain our commanding profile in Africa’s largest economy by maintaining and sustaining our brand attributes of strong financial capacity, high earnings capacity and growth, consistent profitability, professionalism and technical expertise, and a reputation for client service of the highest quality.

IGI has the most diversified investment portfolio in the insurance industry, with interests in Oil and Gas, Telecommunications, Aviation and Banking. The financial strength of IGI derives from the careful selection of an investment mix spanning the above sectors as well as substantial investment in real estate properties, thus guaranteeing long-term stability, regular income streams, adequate liquidity and solvency to protect policyholders.

Our Core Values remain professionalism and Integrity. These core values will drive our medium term plan to become a mega one-stop financial supermarket providing a vast array of world-class insurance, financial intermediation and investment services. To this end, Management has revamped the Group’s Customer Care Infrastructure to leverage on our Information Technology investments in order to deliver on a new industry-leading response time regime on Claims settlement and maintenance marketing.

Accordingly, we have put in place rapid response machinery –Rapid Claims Payment System (RCPS) to ensure prompt payment of all verified claims. This we can assure you will put IGI ahead of competition in prompt claims settlement within the industry. We are inaugurating a 24-hour customer care service which will commence by 1st of March 2007.

We are assigning specially dedicated telephone numbers for the 24hours’ Customer Care Service, to enable us cater for the needs of our policyholders promptly.

In the same vein, and in an effort to reach and serve our extensive national outreach, we are expanding our operational network to 50 branches in the next 12 months, from the present 26 branches. This will make us the first wholly private largest network underwriter in Nigeria and by extension the nearest risk taker Nigerians should count on.

INFORMATION & COMMUNICATION TECHNOLOGY

Today, IGI has a very potent delivery channel on the internet. This is a completely interactive, database driven and very functional engine where users, new and old, can login and conduct business with us. By a simple opt-in process on the IGI website at the address http://www.iginigeria.com a visitor can obtain an insurance quote in any category of business. Such a client will be subsequently contacted by our team of e-business experts who will assist to conclude the deal and establish the cover, without a visit to our office

In the months ahead, IGI will become more IT-driven and fully automated, following a substantial investment in Information and Communication Technology. Our plans to procure and install an internationally renowned, modular Integrated Insurance Package to take care of both Life and Non-Life/general insurance Businesses of IGI are far advanced. This time-tested, and parameter-driven package will be customized fully for the operations of IGI. Data and history of transactions from our existing software will be uploaded into the application at take-on, making the database customer centric. During the up-grade, we will ensure that our services remain uninterrupted.

TECHNICAL EXPERTISE

In terms of technical expertise and knowledge, IGI is best positioned in the industry to tap into the vast business opportunities in the macro-economy, created by the Local Content stipulation for Special Risks (which has been upped to 45 percent), the Cabotage Act, the Pension Reform Act and the National Health Insurance Scheme have provided. Our reputation as industry-leader in the underwriting of big-ticket risks has been further enhanced by the recruitment and training of highly qualified Nigerians and expatriates in Oil and Energy risks.

Mr. Martins Baines our Director responsible for the Oil & Gas Insurance portfolio was a former Oil & Gas Underwriting Manager for Allianz, one of the world largest insurance companies, where he supervised underwriting of Onshore & Offshore Oil & Gas Insurance worldwide. Mr. Baines is a highly skilled expatriate strategically engaged in our group to meet the expanding business opportunities and to actualize technological transfer..

One of the ways of realizing the Nigerian content initiative as far as the underwriting of Oil & Energy insurance is concerned is through the operation of an Oil & Energy Insurance treaty. IGI is the first Insurance Company in Nigeria to develop a specific Oil and Energy Insurance or Reinsurance Treaty. The Oil & Energy Treaty which has received the NAICOM approval is leading the Industry in answering the challenges presented by the Local Content initiative of the Federal Government of Nigeria by offering capacity in excess of US$200 million supported by A rated security. Through this medium of a proper, adequate, well conceived and well structured Treaty, IGI is able to ensure that a sizeable proportion of Oil and Energy risks remain in Nigeria, including a large share of the NNPC Insurance risk.

It is therefore hoped that the Nigerian Insurance industry will join hands together to ensure that the expertise, experience, financial and technical resources required are developed in order to retain a good proportion of the risks in Nigeria.

AFRICAN EXPANSION PROGRAMME

As Insurance Ambassadors, our passion for excellent service and drive for greater challenges has continued to encourage us to extend our business frontiers beyond the shores of Nigeria; an experience which you all can attest to is worth the effort. We have promised without mincing word that we shall extend and hoist the Nigerian flag in six other African countries by establishing operational offices in these places in the next 18 months.

Subsequently, we hope to bring our offshore experience to the Nigerian insurance industry where the IGI Group will be providing critical leadership in the post-consolidation era especially in the areas of capacity retention strategies, product innovation, market penetration and acquisition of superior technical skills and expertise

The tempo of the internationalization of business, which, in 2005 made us the first Nigerian insurance company to trade offshore with our acquisition of 60% equity in the National Insurance Corporation of Uganda, will increase to the benefit of investors in IGI and other stakeholders in Nigeria, Africa and the world in general.

THE INSURANCE INDUSTRY TODAY

The Nigerian insurance industry has begun a new process of transformation. Hopefully, things will never be the same again for an industry which had always depended on external stimuli for change and prodding to increase our contribution to the GDP and nation-building. Thankfully, the winds of change have, once again, in the history of the industry, proved inexorable.

The unwavering resolve of the Federal Government to achieve its overall financial sector reform objectives, especially as they relate to an under-performing insurance sub sector, has gingered the highest level of compliance from our industry with regulatory measures. From some indications, the Government and the National Insurance Commission (NAICOM) are unwilling to settle for half measures.

Similarly, from all indications, it appears that the industry is geared for the expected gains of this constructive consolidation. With an industry capitalization that may likely exceed N200 billion before the end of this year, the Nigerian insurance industry is set to achieve the stature that it deserves if it is to be respected in the global market. The attraction of foreign capital and strategic alignments with big global players which we have heard or witnessed during the consolidation process, will surely translate into improved underwriting capacity, especially for big ticket risks, superior product development and marketing skills and the ability of the industry to attract and retain skilled manpower and increased investment in IT infrastructure, amongst others. The industry will also be able to afford to pay its staff well, a situation that will help reduce huge staff turnover.

CONCLUSION

The insurance industry is awash with funds raised from sundry capital market activities and investor drives. The challenge of achieving the desired return on investment for individuals and institutions that have placed their trust and funds in the industry is real. Companies are bound to come up with different strategies to achieve corporate and investor goals. However, even as players compete for improved market shares, we should not lose focus of the overriding objective of the reform exercise, deepening of the industry in terms of provision of adequate insurance cover for economic activities and assets, provision of adequate insurance cover for the individual or group, increase in public awareness and recognition, all of which will lead to increase in patronage and increase in the standard of living of all Nigerians. May I humbly remind you all that this is a task that requires the collective efforts of all stakeholders, including the press. I believe that you will join us to take the industry to the heights envisaged by the authors of the reform programme.