How would you evaluate insurance penetration in the country?
The penetration is not sufficient; it all depends on the state of our economy, our understanding of the economy and the philosophy of life that Nigerians have. When I say the state of our economy, we are not in productive economy, we are basically spending the income we accrue from oil. It becomes very difficult if people are just buying and selling.
Insurance was better 30 years ago when factories were working because when you have a factory and you know the gestation period between the inception and the eventual production of the product and the processes involved, it will be very difficult for you not to insure because every industrial activity creates very enormous hazards and you know it is going to happen.
But if there is no incentive and everybody is importing, the importation is not structured; every woman goes to Dubai to buy clothes, it is on that basis that majority of what we call business is being run, but if we are in actual production, I doubt if you will put up a factory and you are making blasts and someone tells you about insurance, you will not run quickly to go and insure.
We also have a very poor credit system. If you want to build a house in Nigeria, you have to have your money 100 per cent or you start building it gradually. In a society where mortgage is important, neither the banks or you the borrower will live in a house that is not insured because you know if that house is burnt down and you are still owing the bank, nobody will tell you before you insure.
Look at our outlook to life, the sociological aspect, you damage my car and you come out and prostrate, but the prostration can never be collected in a bag and taken to the mechanic, but if you hold the man responsible, the Nigerian sociology is that you are a wicked man, and that sociology affects law and order.
We are never ever sure if we should enforce the law or not , if you enforce the law or enforce your right, you are wicked, so if we have that thinking, it becomes a very difficult thing to ensure liabilities.
There are things you cannot do in other countries without liability insurance because the man you injure has a wife and children at home, the ‘danfo driver’ runs into the bridge and everybody enters the lagoon and the man swims away if you catch him, the man brings his father and mother to come and prostrate for somebody who has died, who is the breadwinner of the family, you will say you must accept him so that you don’t look like a wicked man, but one week later, that danfo driver has gotten another vehicle and he is earning money. If you look at these factors they militate against insurance. The last thing you think about is insurance because the sociological infrastructure does not even support insuring.
Insurance is not really about what is going to happen to you, it is about two things; what can happen, and when it happens can you be pulled back to the extent where you were so that you can start running your life. So the totality of that is why we have low penetration in insurance.
Is the low penetration mainly about our inability to enforce the existing laws on mandatory insurance?
I am a private sector man, and I am one person that likes things developing from the ground. Laws are difficult to enforce if they are from top-down, but if they are from ground-up people will want the law.
I will say, gradually the business environment is changing, we are getting more productive in agriculture and in industrial development because the recession jostled us. So with that, insurance is coming up.
We are getting more sophisticated business relationships, people are borrowing money from the banks, even the importers and the banks will not give you without insuring the physical hazard of what they financed, they are certain that if there is any physical hazard to what they financed they will make their money back; so things are moving.
Insurance is also doing a lot to sensitise and make people sensitive to insurance; we are still doing it, other than that, even if government decrees compliance, it doesn’t always work if people don’t want to.
Laws always work when people want to obey the them, laws don’t work when you force people to obey, if people are convinced that this law is to their benefit, it will be very easy to comply, very easy to enforce because only minority will be breaking the law. When people don’t believe in the law, majority will be breaking it and enforcement will become purely academic or it will break down after a while and nobody will talk about it.
But the moment people see the need, why should you live in a house and the building collapses and it is not insured; you save your life, wife and your children, but you have lost your property and the landlord says the will of God has happened. It shouldn’t have been the will of God that you are naked, he should be made to pay.
Now the only thing government can do in that respect is what government has done to introduce Occupier’s Liability and Building Owners Liability, but Nigerians don’t have the courage to ask of it, there is nothing anybody can do.
How would you react to customer complaints on difficulty in accessing claims?
We have, but because of the sociological factors I mentioned earlier, people are still not attuned to insurance and we do pay a lot of claims.
But you see the insurance document, the policy is contract people don’t read, thereby supporting the cliché that if you want to hide anything from the blackman, write it down. If people don’t read their contracts to know what their rights are, you cannot force them to read them.
The only major legal document that the common man will own is an insurance contract, other than tenancy agreement, but they will never read it. If you want to go court, you engage a lawyer. I tell people that there is no law in Nigeria that says you must engage a lawyer, but you know you are likely going to lose if you don’t engage a lawyer. Why then will you have an asset and you will not engage a professional to present your insurance request forward.
There are insurance brokers and you don’t even need to pay them like you pay lawyers; the service is free to the consumers, so why don’t you get an insurance professional to give you advice. Now when you don’t go through a professional and you lose, I have never seen a Nigerian that went to court and didn’t go through a lawyer because he will likely lose and everybody will say serves you right, but when you want to buy insurance, something as technical as insurance, you walk up to an insurance company, buy it and you don’t read the contract and don’t even engage a professional to interpret it and tell you your rights.
As a man who is preparing to retire, are you confortable with the offerings of the health and educational systems?
Not at all; the health system, and education systems are not what they are meant to be, it still boils down to what Nigeria wants; if the society wants good a health system, then it must find a way to make the society pay for it in a way that will be acceptable to everybody, but we have not gotten to that point because we have not actually agreed on what we want and how we want to get it.
We better have a health system than we are have in Nigeria. But you know things degenerated over time to what it is now.
In the advanced world, private education is an exception, but in Nigeria, it is almost becoming a rule and we are almost going the same way with health.
We may have to return to what we called primary education board so that the residents of a community will control the way and standard of education there.
Unfortunately, we are moving to private education. So it is the business of the owner rather than the business of the community.
We have to revamp the system of our public education to the point were members of the community must be involved in the education of people in that community. Maybe because we don’t pay taxes generally, government took over the running of education. If we are paying all the taxes like they do in other places, like property taxes in which case all your children living in Ikeja will go to school in Ikeja because their parents pay taxes, then parents will get to know what actually public education is doing.
So where does the issues lay: in good governance or structure?
Our problem is structural, but sometimes we think it is a bad government, but even a good government won’t help us if we don’t address such structure.
The number of constituent units that make up the federation is too many, and many states spend 80 to 90 per cent of their income on just recurrent, so we need to deal with how Nigeria is structured.
Also, from my perspective, the system of government we run is equally too expensive.
So how do we address the structural problem?
I don’t know. It is complex. My answer to that question is that it is a myriad of issues.
If you say let’s reduce Nigeria to eight states, politicians will almost lynch you. We really need to sit our politicians down and say this is the best way out, and when so many people are not convinced, it becomes a problem.
I think we need to tinker with the structure, we have too many sub national units and it is a huge drain on the resources of the nation.
Take the South West where we have six education commissioners; to achieve what? Six ministries of education with a total paraphernalia of office; so what has that achieved for the South West.
When there is just one Ministry of Education deciding policy concerning funds for research and development, we will achieve more.
We should remove railway from the executive legislative list so that it becomes concurrent. I know that lagos State is doing its own railway, I think Rivers did, Kano also did. There is something they are doing in Kano about railway.
What is your take on youthful leadership for the country?
The Azikiwe’s, the Awolowo’s and so on, the British did not empower them, they saw that they wanted their country to be better and they rose up. Why do the youths want something to be created for them like the affirmative action that was created for women, like okay, there must be 10 youths in government, is that what they want?.
If you form 60 per cent of the entire population and you want people to organise you to take your rights, then you don’t know what your rights are.
Or maybe the youths have not been able to sell better programmes to their own colleagues; so they want me to do the job for them; to handover the job to them.
So, my agemates are not going to open their eyes and allow the youths to push them aside until we all die. We remain Nigerians and we are stakeholders.
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