New local weather dangers demand stronger insurance coverage protection — Rex Insurance coverage CEO

As local weather change drives extra frequent floods, heatwaves and new types of loss throughout Nigeria, the insurance coverage business is being compelled to reassess how danger is recognized, priced and insured. On this interview with OLUWAKEMI ABIMBOLA, the Managing Director and Chief Govt Officer of Rex Insurance coverage, Mrs Ebelechukwu Nwachukwu, discusses how ready the sector is to reply to these rising dangers and others.

You had been lately named among the many nation’s main company figures, a formidable achievement. What has your expertise been like steering Rex Insurance coverage since assuming workplace?

I dedicate myself to my work and concentrate on clear mandates in each function. Being recognised by the BusinessDay Awards and Almond Awards is an honour, particularly as buyer votes contributed. This displays positively on my workforce and model. You don’t succeed as a CEO when your workforce is just not doing effectively. So, for folks to recognise meaning we’re doing effectively, and meaning lots to me. Implausible.

Constructing on that, how would you assess the efficiency of your workforce, whom you’ve simply praised, because you assumed the function of Managing Director?

Properly, it was not the best course of. I’ll let you know the story; I hope it matches into the response I must be giving. I joined the corporate in January 2023, an organization that’s over 100 years previous. We had an ageing workforce, very archaic, gradual processes, and our market recognition rating was very low when it comes to customer support. Expertise adoption was not optimum. That was the corporate I inherited; the model was not recognised as robust.

So, my mandate after I joined was very clear: remodel the enterprise, make it extra optimum, make it extra customer-friendly, and make it the insurance coverage firm of alternative. We did begin the entire course of. On most CEOs’ resumes, the very first thing they do is go to the market to search for extra enterprise. I spent the primary six months working internally to optimise our processes and work on the folks. The corporate already had very expert folks; previous firms pay a whole lot of consideration to ability improvement. So we had that at Rex already. However had been the folks empowered to utilise these abilities in a manner that was constructive for the organisation? I needed to flip that round.

So, we did a whole lot of restructuring internally, we made many course of adjustments, we engaged know-how to assist us in some ways, and my workforce was very receptive to all of the adjustments that wanted to occur. We’re making it occur. It’s nonetheless a course of; it’s a journey, however I believe we’ve began it. We’ve laid a superb basis upon which we are able to construct the Rex model.

That’s fairly an fascinating account. How would you consider the present state of Nigeria’s insurance coverage business?

The expansion that we see within the business is just not single-digit anymore; we see the business remodeling, turning round ends in multiples year-on-year, and that’s superb for us. Because the Nigerian Insurance coverage Trade Reform Act 2025 was handed, we’ve additionally seen inventory costs go up, which exhibits investor confidence within the business.

One of many challenges I believe the business has, and we have now recognized, is consciousness of what insurance coverage really means to the common Nigerian. Everybody thinks it’s removed from them; insurance coverage is for large folks, for individuals who have loads of cash. Our accountability is to discover a technique to drive it residence, to let all people know that insurance coverage is one thing everybody ought to have. Each household must be insured, one type of insurance coverage or one other: life, well being, or asset insurance coverage.

We work very exhausting as Nigerians. You’re employed exhausting, you save, your loved ones offers you cash, and you purchase a keke (tricycle). Nevertheless, you don’t insure it, and life occurs to that keke. You’ve misplaced all the things. So, how can we get folks throughout the chain to grasp that they want insurance coverage? As quickly as we are able to obtain that, utilizing know-how and the numerous face-to-face engagements we already do as insurance coverage folks, I believe penetration will enhance.

So sure, we’re not the place we must be. We’ve got recognized the place we expect we must be. We now have a regulation that helps what we must be driving at, and I believe the business’s development is now set to actually occur.

You may have described NIIRA as a crucial regulation for reinforcing insurance coverage penetration. How is Rex Insurance coverage positioning itself to interact with the brand new regulation, and what affect do you anticipate it to have on your online business?

It’s a regulation that, if applied with the best integrity, would really remodel the business, rising engagement and belief in organisational operations. So, for us at Rex, what we’re doing is reviewing our inner organisation, checking our operational danger exposures, upgrading our distribution channels, and making certain all our processes are commonplace. Although we reviewed our processes barely two years in the past, we’re upgrading them to make sure they meet the brand new requirements required by NIIRA.

However most significantly, we’ve strongly stepped up compliance. We’ve stepped up compliance to make sure we have now processes and compliance buildings that mirror all of NIIRA’s necessities. That is how we’re making ready, not simply on the capital aspect. There’s a whole lot of accountability related to NIIRA, and with how we view dangers beneath this new Act, and we wish to guarantee our processes mirror our understanding of that.

So, it’s a course of for us the place we admire the long-term stability NIIRA is about to deliver to the insurance coverage business, and we wish to be one of many gamers that takes nice benefit of this new regulation.

Earlier than the introduction of NIIRA, NAICOM had set an agenda for insurers to develop past Nigeria beneath the African Continental Free Commerce Space. Is Rex Insurance coverage contemplating this path, and the way do you see AfCFTA shaping intra-African commerce?

I believe AfCFTA opens doorways for us throughout African markets. We’ve already seen a number of curiosity coming into Nigeria. We don’t hear as a lot about Nigerian curiosity going out, however we do have some insurance coverage firms that already function in several nations exterior Nigeria.

It’s going to improve competitors ultimately, however for us to learn, we have now to scale up our capability. We’ve got to extend regional partnerships and strengthen reinsurance agreements to enhance service supply throughout African companies.

As Rex Insurance coverage, are we fascinated with working exterior of Nigeria? Not in the mean time. However we are able to have partnerships that allow that, for instance, in Uganda, we might accomplice to supply these companies and in addition handle the repatriation of that enterprise to Nigeria. So, we’re fascinated with these varieties of partnerships, however not opening branches or organising operations exterior Nigeria simply but.

Nigeria has a lot potential. Our penetration ratio, as you realize, may be very, very low. We consider our buyers in Rex invested on the grounds of us deepening Nigerian markets. In order that’s our first focus. I wish to stick with that focus till we make the affect we wish to make earlier than we take into consideration going wherever else.

A latest Geneva Affiliation report exhibits that firms are more and more buying insurance coverage to cowl dangers linked to the adoption of AI. Is that this pattern rising in our market as effectively, and the way can insurers place themselves to make the most of it?

AI adoption remains to be within the understanding part in Nigeria. It’s nonetheless at an early stage of adoption within the insurance coverage sector. I believe after we take into account AI in insurance coverage now, we’re fascinated with how we are able to use it to conduct surveys and monitor our danger administration. For instance, you insure a manufacturing unit or a warehouse, and items are transferring out and in.

How can we use AI to watch these actions in order that we’re precisely protecting these places?

However the dangers that AI now exposes us to, I don’t assume that’s one thing we have now sat all the way down to analyse as an business. Our focus to date has been on how we are able to use it to boost operations, and it’s nonetheless within the early levels of adoption.

How is your organisation utilizing digital platforms to attach with youthful Nigerians and underserved communities?

We’ve invested lots in know-how at Rex Insurance coverage. As I stated, we’ve had a whole lot of inner adoption of know-how for all our processes. We do our operations end-to-end right this moment utilizing technological platforms. We’ve invested lots in deploying know-how platforms, together with cell platforms, that allow folks to purchase insurance coverage and repair their insurance policies digitally.

You should buy third-party motor insurance coverage as a result of it’s obligatory. You may have a declare; you may also go there and lodge your declare. Finish-to-end, you may be serviced with out seeing anybody. We do assume that’s what youthful folks need nowadays. They do lots on their telephones. If you happen to’re ready for them to come back to your places of work, you’ll be ready a very long time.

However what’s extra crucial for us, and that’s one thing we’ve labored on, is that we have now a number of quite simple merchandise, however we’re simplifying them additional. Considered one of our mission statements is to create a world the place insurance coverage is straightforward and accessible. So we’re simplifying our merchandise additional. We’re attempting to cost our merchandise competitively after which put them on these digital and cell platforms. Individuals can relate to them, make a shopping for choice, and they’re inexpensive. That’s what we’re engaged on as effectively. The back-end know-how assist that allows us to do this front-end work, we have now already put in place to a really giant extent.

What kind of suggestions have you ever obtained from prospects utilizing these digital platforms?

I believe it’s been encouraging. We’ve got a lot of our merchandise, as I stated, already on digital platforms. We get a whole lot of suggestions. For individuals who do imports, for instance, they should open a letter of credit score and want marine insurance coverage; they’ll simply sit within the workplace and do what they should do. It’s one thing that has elevated our engagement with our prospects, one thing they admire to a really excessive diploma, and the engagement is simply rising.

Our prospects can request a citation and get it on our digital platforms and examine it with different insurance coverage firms, which can be gaining a whole lot of traction.
So, prospects admire the digital method we have now to our enterprise, and they’re expressing this to us. Additionally, lodging claims, a declare occurs, and you may simply sit down and lodge the declare, and anyone responds to you virtually instantly. You are feeling like you’ve gotten an insurance coverage firm. Our slogan is, “You aren’t alone.” So you are feeling like somebody is with you, and that’s actually what we wish to regularly create.

With initiatives like CIIN, the NAICOM Sandbox, and the NIA hackathon, there’s appreciable dialogue round know-how and its adoption within the business. How a lot of this dialogue has really translated into tangible actions that profit policyholders?

The trustworthy response to that might be: not lots. Shopper engagement is just not excessive; it’s nonetheless simply increase. The NAICOM Sandbox, for instance, is meant to create innovation, deliver your concepts to NAICOM. Let’s ideate; let’s create magic collectively. Engagement is just not as NAICOM anticipated, however I believe there’s a build-up to extra engagement. Rather a lot is going on in our business on the identical time. An entire lot is going on.

So, the NAICOM Sandbox is there to allow innovation and have insurers are available in to check their concepts. I don’t assume the buyer is feeling that but, but it surely’s sitting there ready for us to utilise it.

The hackathon, which occurred beneath the CIIN, is admittedly for creating digital capability and triggering options round fraud detection. Insurance coverage fraud is a significant challenge. So, the hackathon is admittedly about making ready contemporary concepts for fraud detection. The extra we have interaction skilled hackers within the insurance coverage sector, and many people have engaged them and located our techniques are simple to hack into, it has led us to enhance our safety. So, that is what this platform has signalled to me.

The NIA one can be there. Engagement is barely simply starting as a result of the launch was latest. So, it’s about points round KYC and information trade, which is essential. I keep in mind, not on this job however in my former job, there was a declare lodged by the identical buyer on the identical asset with about 4 insurance coverage firms. The client had insured the identical automotive with 4 totally different firms, after which lodged a declare throughout all 4. As a result of the premium was paid, all 4 registered these claims and started to course of them. However in the middle of inspection, as a result of typically we use exterior brokers to do our surveys or claims changes, they discovered they had been all adjusting the identical factor.

So, these platforms are actually to harmonise such issues. When you’ve gotten a declare, you’ve gotten a single platform the place you lodge that declare, and if anyone else has the identical declare, you possibly can simply detect it. The identical goes for KYC, as a result of KYC is essential for our enterprise. Who’s the client you’re insuring? What does he do? What have you learnt about him? You may’t present safety for somebody you don’t know.

Within the banks right this moment, you enter your NIN and buyer information, and in every single place they borrowed from will present up. We’re attempting to create our personal platform that allows you to see the insurance coverage information of any buyer. That’s what is going on on the NIA platform. Shopper engagement goes to occur, but it surely’s nonetheless early days for all of those concepts.

Earlier, you famous that the insurance coverage business’s contribution is now rising notably, significantly concerning its share of GDP. Within the second quarter, it grew in each nominal and actual phrases. What do you see as the principle elements driving this development?

There’s extra engagement. There’s an economic system that this authorities is considerably attempting to construct, and it’s producing a whole lot of transactions. There’s building happening, there’s commerce, there’s actual property; it’s impacting the oil and gasoline sector. So we complain in regards to the issues that aren’t occurring, however there’s nonetheless lots occurring that’s constructive for the economic system. And in Nigeria, or any economic system, insurance coverage responds to financial development.

So, the place there’s a whole lot of exercise, we allow financial development, and we additionally reply to it. Roads are being constructed, dams are being repaired, insurance coverage engagement goes up.

Claims within the insurance coverage business have improved considerably, and persons are speaking about claims. Due to information safety, you will need to get the client’s consent earlier than you discuss a declare. However insurance coverage firms are paying claims, and that’s constructing confidence. After we construct confidence within the insurance coverage sector, extra folks then really feel the necessity to insure as a result of they know their claims can be paid.

Additionally, the engagement with know-how. A variety of companies are actually on technological platforms. It’s simple to purchase insurance coverage. As I described, direct sensible insurance coverage, you possibly can simply purchase it on a digital platform, lodge your declare, and it is going to be paid. That’s strongly enhancing engagement and enhancing our enterprise.

Then publicity. Insurance coverage firms are participating an increasing number of. You see market storms, and also you see insurance coverage firms taking to the streets, doing various kinds of work to create consciousness. NAICOM additionally, beneath its insurers’ committee, has an entire concentrate on communications and consciousness. We attempt to make the general public conscious of insurance coverage merchandise and the way to have interaction with them.

And with third-party enforcement, enforcement can be occurring. The method we took as an business was to enlighten folks on what ‘third occasion’ really means. A constructing beneath building, it’s obligatory. Why do you want it? So we’re not saying, “Come and purchase”; we’re saying, “That is what it’s.”

It’s your accountability while you’re on the street to make sure your automotive has genuine third-party insurance coverage. Once you’re constructing a home, sure, you’ve thought-about all of your dangers, however that constructing beneath building must also be insured for third-party liabilities and for folks on-site who might have accidents and lose their lives or be quickly or completely disabled. It is best to have a level of accountability to nsure they’re lined by insurance coverage.

So, the notice, the enforcement, financial actions, know-how adoption, and immediate declare settlements, all of that’s driving a rise in insurance coverage engagement and impacting income from the insurance coverage sector. I believe it’s a pattern that can proceed.

You latterly chaired the Native Organising Committee of the WAICA Schooling Convention in Lagos, which centered on local weather danger and the way West African insurers can reply. From an operator’s perspective, what had been the important thing takeaways concerning local weather danger and the business’s readiness?

I believe that session made folks get up to the truth that dangers are altering due to local weather. I’ll converse first as Rex. Due to our curiosity in agricultural insurance coverage, we’ve explored this to a really excessive diploma and developed merchandise centered on local weather. A few of our buyers, Blue Orchard, beneath the InsuResilience Fund, have additionally offered a whole lot of coaching and publicity to Rex. We even have partnerships with Africa Re to focus on climate-related insurance coverage dangers to farmers. So, we’ve developed farmer-based, farm-based, and livestock insurance coverage that covers climate-based dangers at Rex.

That session raised consciousness that the character of dangers might change. We now have extra flooding, and fires unfold sooner due to greater warmth ranges. We should start to organize for these sorts of dangers. So, it’s now not sufficient to exclude them from coverage documentation; it’s about the way you embody them and correctly handle these dangers. That was what the session was set to focus on, and in addition to assist us take into consideration the way to drive these into easier merchandise.

I’ll provide you with an instance. We had a buyer who suffered flood injury. We now have just a few electrical vehicles in Nigeria, and he was caught within the Lekki flood together with his electrical automotive. The character of the danger was unfamiliar to us. The automotive was insured. You possibly can have a look at it and see no bodily injury in any respect, however the water broken the automotive’s capability to perform correctly. We went forwards and backwards with that buyer till we discovered the grounds to settle. However actually and really, there must be merchandise that tackle these sorts of dangers. It didn’t occur as a result of he crashed; it occurred due to the climate and flooding whereas he was on the street.

So, the session was actually to make us conscious that the local weather is creating a unique kind of danger. We’ve got to cowl these dangers however achieve this effectively. Reinsurers had been there. Underwriters had been there. These programmes are largely sponsored by reinsurance firms as a result of all of us carry danger and switch a few of it to them, they usually’re very open to data sharing.

What’s going to we do with the data we gathered from there? How will we use it positively to get well? It’s but to be seen. However as I stated earlier, we have already got climate-related merchandise on the agro aspect of our enterprise. Individuals have livestock, and excessive warmth can kill all of it. We’ve seen these sorts of losses. We’ve seen farms broken by flooding. We’ve seen flooding so extreme that the planting season passes, and farmers can’t plant. These items are occurring, and we want merchandise, companies, and danger administration buildings to supply options to the general public.

How do you envision the Nigerian insurance coverage business evolving over the subsequent 5 years, main as much as 2030?

I believe we’ll be extra related. There’ll be way more know-how adoption. Extra folks will use insurance coverage as a planning device at totally different life levels, from beginning out to retirement. There’ll be extra engagement usually, and I believe it is going to be a extra seen business and extra worthwhile for shareholders and different stakeholders.

How would you prefer to be remembered as CEO?

From the day I arrived, I used to be decided to go away the corporate significantly better than I met it, higher for the general public we serve, higher for shareholders by way of stronger returns, and higher for patrons by way of immediate claims settlement and reliability. However most necessary to my coronary heart is leaving it higher for the individuals who work right here, so their lives mirror the corporate’s development.

You may’t have an organization rising on one aspect whereas workers don’t really feel that development, financially, in abilities, and in publicity. I’d like to go away Rex understanding I’ve left behind a few of the greatest folks the insurance coverage business can have.