The Insurers' Race to 1kobo per share
The stocks of insurance companies which are traded in the Nigerian Stock Exchange (NSE) continue to bleed. According to the Guardian, “at the end of last week’s transactions, five insurance stocks recorded price depreciation. … Sovereign Trust Insurance …to close at N0.38 per share. Unic Diversified Holdings …to close at N0.22 per share. African Alliance Insurance …to close at N0.36 per share. Royal Exchange … to close at N0.31 per share. Standard Alliance … to close at N0.44 per share.” Simply, these insurers are now racing to 1 kobo which became possible after the new changes in the NSE.
The partial good news now is that investors are now worried; the old protection policy is now over. Yes, the insurance sector is the most closed sector in the Nigerian economy. You need to have the CIIN [Chartered Insurance Institute of Nigeria] charter before you can do much. Anyone can be a bank CEO in Nigeria but only few dozens of people can be an insurance company CEO. Without CIIN you have no luck.
Worried about the free fall in the shares of insurance companies on the nation’s bourse, capital market investors have stressed the need for the industry regulator, and professional bodies to intensify efforts at mitigating the challenges causing the sub-optimal performance of the sector in Nigeria.
The investors, who expressed dismay on the level at which their investment depreciates in value on the Nigerian Stock Exchange (NSE), called for a review of some laws regulating the affairs of the industry.
Where are the InsureTechs? The time is now.
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So with all the famed CIIN the operators are as daft as rock? It's a typical example of why certifications and beautiful titles don't automatically translate to business success, you have to execute with clarity of purpose and be able to innovate consistently.
The insurance sector has remained in stasis, with the lame excuse that Nigerians don't like insurance policy, but Nigerians rarely like anything, until you learn how to connect and transmit value to those Nigerians.
The race to 1kobo is very hot and competitive, and the operators are more confused each passing day, when it comes to how to heal the bleeding sector. Time to fully democratize the sector and allow everyone with good brain to operate there. The exclusivity mantra has failed woefully, business success is completely decoupled from certifications and unionism.
