The Chairman, United Bank for Africa and Heirs Holdings, Tony Elumelu, has proposed a further increase in the capital bases of Nigeria insurers who lag peers across the globe.
The billionaire investor has proposed N20 billion capital base for life, N30 billion general, and N50 billion capital for composite insurance operations.
He said this at the ongoing 2023 National Insurance Conference today in Abuja.
Speaking on the theme of the Conference: ‘Redefining Safety: Insurance Solutions for Public Buildings and Buildings Under Construction’, Elumelu, noted that poor regulations and slow claims payment, which he attributes to the use of manual process, have continued to undermine an industry that contributes less than 1 percent to the country’s GDP.
“Today, capital requirements are set at 8bn for Life insurance and 10 billion for general insurance. With the devaluation of the currency, you are talking about USD 8million, USD10 million capital requirements for an insurance company in Africa’s largest economy,” said Elumelu.
“How can an industry intend to ‘insure’ and mitigate the risks associated with the economic growth of a country having such low capital requirements,” he adds.
He also noted that the insurance industry still has manual, inefficient processes, especially around critical issues such as claims payments.
“Insurance companies in the United States (US) and Europe can pay out claims in minutes with little human intervention. We should aim for no less! This is my charge to the practitioners in the room here today,” said Elumelu.