A disturbing figure emerged on Tuesday suggesting that most Nigerians are without insurance cover, a situation blamed on poor enlightenment of the importance of the scheme.
This was contained in the latest weekly poll results released by NOI Polls.
The results have also indicated that Vehicle/Car insurance (63%) is the most commonly purchased insurance cover, and Insurance companies (42%) and agents (41%) are the key channels of insurance purchase.
Furthermore, the major causes of the low market penetration and poor insurance culture are low awareness and poor enlightenment on the benefits of insurance (40%).
The poll also reveals huge potentials for insurance companies and practitioners to design new products to target Nigeria’s bulging youth population. These are the key findings from the Retail Insurance Snap Poll conducted in the week of August 19th, 2013.
NOI Polls aligned with recent media report that the insurance culture in Nigeria can best be described as almost non-existent.
“Despite the fact that the Nigerian environment has a high and increasing level of risk, less than 2% of Insurable risks are covered by insurance.
“Previous studies have shown that low awareness and lack of knowledge about insurance products characterize people’s opinions about the insurance sector. Apart from these, negative perceptions of Nigerians towards insurance have generally inhibited the growth of the sector. For instance many are of the opinion that insurance companies are more concerned in collecting premiums, than in settling claims thus affecting the general confidence in the insurance companies,” the research engine noted.
There are also cultural and religious factors associated with the slow growth of the insurance sector. Anecdotal evidences suggest that the demand for insurance cover in Nigeria may be affected by various cultural and religious beliefs in the country in a way that it affects people’s perceptions on risk aversion. For instance, some religions have created a strong disapproval to life insurance, declaring that dependence on life insurance brings about a distrust of God‘s protecting care.
In view of these, NOI Polls conducted its latest poll on Retail Insurance to explore the insurance culture in Nigeria in terms of the level of patronage and the reasons surrounding poor insurance culture in Nigeria.
Respondents were asked four specific questions. Firstly, in order to measure the proportion of Nigerians that have insurance, respondents were asked: At present, do you have any form of insurance cover in your name? Overall, the majority of Nigerians (86%) do not have any form of insurance cover; thus indicating low insurance penetration in the country and poor insurance culture amongst Nigerians.