The Nigerian insurance industry has been plagued by a growing number of unresolved complaints, with the latest figures revealing a staggering N22 billion in unpaid claims.
This alarming trend has sparked concerns among policyholders, regulators, and industry stakeholders, who are calling for urgent reforms to address the issue.
The Nigerian insurance industry has experienced significant growth in recent years, with the sector’s gross premium income rising from N315 billion in 2015 to N533 billion in 2020. However, this growth has been marred by a rising number of complaints from policyholders, who are increasingly frustrated with the delays and difficulties in resolving their claims.
According to data obtained from the National Insurance Commission (NAICOM), the total value of unresolved complaints in the life and motor insurance sectors stood at N22 billion as of December 2022. This figure represents a significant increase from the N15 billion recorded in 2020, and underscores the need for urgent action to address the issue.
Industry experts and regulators have identified several factors contributing to the growing number of unresolved complaints. These include:
- – Lack of transparency: Insurers have been accused of lacking transparency in their claims settlement processes, leaving policyholders in the dark about the status of their claims.
- – Inadequate documentation: In some cases, policyholders have been unable to provide adequate documentation to support their claims, leading to delays and disputes.
- Insufficient capacity: Some insurers have been accused of lacking the necessary capacity to handle the volume of claims, leading to backlogs and delays.
The failure to resolve complaints in a timely and satisfactory manner can have serious consequences for policyholders, insurers, and the industry as a whole. These consequences include:
- Loss of trust: Unresolved complaints can erode trust between policyholders and insurers, making it more difficult to attract and retain customers.
- Reputational damage: Insurers that fail to resolve complaints in a timely and satisfactory manner risk damaging their reputation and losing business.
- Regulatory action: In extreme cases, insurers that fail to resolve complaints may face regulatory action, including fines and penalties.
To address the growing number of unresolved complaints, industry stakeholders are calling for urgent reforms. These reforms include:
– Improved transparency: Insurers must be more transparent in their claims settlement processes, providing policyholders with regular updates on the status of their claims.
– Enhanced capacity: Insurers must invest in building their capacity to handle claims, including hiring more staff and improving their technology.
– Regulatory oversight: Regulators must provide closer oversight of the industry, ensuring that insurers are meeting their obligations to policyholders.
The growing number of unresolved complaints in the life and motor insurance sectors is a major concern that requires urgent attention. Insurers, regulators, and industry stakeholders must work together to address the issue, by improving transparency, enhancing capacity, and providing closer regulatory oversight. By taking these steps, the industry can restore trust and confidence among policyholders, and ensure that the sector continues to grow and develop in a sustainable and responsible manner.