By Nse Anthony-Uko
(Sundiata Finance) — In the bid to weather the current harsh economic conditions, and retain their customers’ patronage, insurance companies have adopted a strategy of allowing them spread the payment of premiums.
The palliative is to allow consumers whose disposable incomes have been hit badly by rising cost of leaving and low economic activity, to remain within risk protection, based on what they can afford at the moment. Under the current situation, consumers are being given options to pay in bits -either monthly, quarterly or half yearly for annual premiums, and are reminded to pay up balance as soon as initial payments near expiration.
Eddie Efekoha, managing director, Consolidated Hallmark Insurance, said, “We needed to offer that palliative to assist our customers remain within the risk protection bas- ket.” Efekoha, whose company leads major aviation risks in Nigeria, said, “We allow our customers to spread payments because we also appreciate the situation of things in the economy. “You know the premium on aviation risk is high and this is the era of ‘No Premium No Cover,’ so we allow airlines to pay premium monthly.” According to Efekoha, who is also the chairman of the Nigerian Insurers Association (NIA), “what is important is that premiums have been paid to cover the period of the contract, and when that expires, the customer makes new paymentbefore last day of the existing cover, and the policy runs over the cover period.” Ganiu Musa, group manag- ing director/CEO, Cornerstone Insurance, said, “We under- stand the situation of things in the economy and how people are struggling to survive, not limited to any part of the coun- try.” But what we have done as a company is to ensure that we do not lose the customers we have already. At least, if we don’t get new once, we try to keep the once we have, Ganiu said. He said insurers had to bring up strategies to keep its existing customers with these payment palliatives, which is hoped will normalise when the economy improves again. An insurance customer, Ibeyemi Lawson, who took a comprehensive motor policy for his Toyota Landcruiser, confirmed that he was given the option to pay twice the pre- mium when he gave reasons for wanting to go off cover. “My insurance company offered to allow me spread payment twice since I did not have the whole money to pay at once. I was very comfortable with it since I still want to insure my vehicle,” Ibiyemi said. Funmi Babington-Ashaye, managing director/CEO, Risk Analysts Insurance Brokers, reviewing the economy had said that the value of the purchasing power was dwindling by the day so much so that the minimum wage of N18,000 per month could hardly buy a bag of rice. “Local airlines are suspend- ing their operations because of operational challenges. It is fair to say that these are not the best of times for households and individuals.