Swiss Re-Backed Nigerian Life Insurer Sees Sales Surge as Pandemic Starts Taking Hold

By Tope Alake and Anthony Osae-Brown | June 16, 2020

Nigeria’s biggest insurer is seeing more demand from the government and employers of health workers for life cover as the coronavirus pandemic starts taking hold in Africa’s most populous country.

“Health workers are demanding it, other state governments and municipalities that didn’t have it before are now looking at it differently,” Leadway Assurance Co. Ltd. Chief Executive Officer Tunde Hassan-Odukale said in an interview in Lagos. “People who were not doing group life insurance before, are now looking at it on a corporate basis.”

Sales of group life policies have jumped 10% this year and the trend is expected to continue with COVID-19 cases in Nigeria still on the rise, he said. This may help to counteract pressure on the firm’s retail business, where individual life policies could be hit by a slowdown in economic activity because of lockdown measures to curb the spread of the disease.

The number of confirmed COVID-19 cases has doubled to more than 400 per day in the past week in the continent’s biggest oil producer. Doctors began an indefinite strike on Monday to protest the lack of protective equipment, to demand the payment of all owed salaries and to call for an end to the harassment and assault of medical workers by security agencies.

Leadway, in which Swiss Re acquired a 25% stake in 2016, expects to retain its customer base in the face of fierce competition by discounting new business, Hassan-Odukale said. It is also looking to tap an upsurge in interest for health insurance by offering medical-related coverage by the end of the year, the CEO said.

The 50-year-old firm is not planning acquisitions or capital raising as it currently meets the financial requirements to operate as specified by the regulator, Hassan-Odukale said.

The insurer is working with its banking partners, Guaranty Trust Bank Plc and Standard Chartered Plc, to boost sales of insurance products, he said. A lack of enforcement on compulsory insurance products is hindering demand as is an absence of incentives.

“The banks are not incentivized to sell insurance with the commission level. They are more likely to take an action if your relationship manager gets rewarded and the bank is also rewarded,” he said. “The regulator should be focused on deepening the penetration.”

–With assistance from William Clowes and Emele Onu.

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