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Technology Frees Underwriters from Armchair business



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Insurance experts the world over, seem to agree that insurance agents have a crucial role to play in insurance. Even a session on IT strategies in a cost-cutting environment held recently under the title at ISOTECH 2009 a lot of discussions was focused on agents. The responsibility to improve relationships now likely falls on the underwriter. The role of the underwriter has changed over the past few years, in part due to technology. Gone are the eight-hour days of sitting at a desk. The availability of business rules and automated underwriting has freed up underwriters to take on somewhat unfamiliar responsibilities, one of which is the face and voice of the insurer to agents.
The relationship between the underwriter and agent is an important one, especially in the current market. It is difficult to grow business under the prevailing economic situation in Nigeria without relying on agents. This is more so as most of the insurance companies do not have offices in the remote areas. Experts believe that no matter the innovations which operators may put in place, agents cannot be easily wished away. According to Desmond Azuwike, general managers of ABC Agency and Brokers, you can introduce new products, but consumers may be demanding for simpler products; you can acquire other companies, but capital markets may be tight. Thus, establishing, maintaining and improving relationships with agents may be the answer, he says adding that companies that take innovative approaches are going to win.
While in the past, underwriters and technology may not have mixed well expert opinion says interest in underwriting technology, especially from personal lines, is growing. "What we’ve seen in talking to underwriters is that it is not really diminishing their intellectual capital or eliminating some of the processes. Rather, it is alleviating some of their manual tasks and enabling them to do more of the analytical work they really want to do.
Technology also is freeing up some of the underwriters’ time to become more involved in the sales process, "As you put this technology in place and offer some rules-based underwriting and pricing, you offload some of the template decisions to the other people in the enterprise and free up the underwriters to build relationships and sell more," he says.
More sophisticated technologies have hit the market over the past few years. Some of these technologies, according to experts enable collaboration between underwriters and agents. "The idea behind a workstation is to enable the underwriters to have a central location where they can access internal and external data needed in order to fully evaluate the risk," he says. "So, for example, on the property side, making it possible to calculate the insurance-to-value or probable maximum loss, or on the reinsurance side, doing some line-setting to determine retention levels for facultative reinsurance. Those are the types of things that these newer platforms provide in the commercial underwriter’s space.
"The balance between technology and relationships is critically important to our business"says Azuwike. He added that "the ease and dependability of technology enables our underwriters to focus their attention on the needs of the agency and the customer. It gives them more time to listen and solve real issues without the distraction that tedious, manual processes can create. It is a combination of science and humanity for us. We like to hear from our agencies; if they are not talking with us, then they are talking to our competitor."
He expressed that at ABC, they view the agent/underwriter relationship as critical. "Agents understand that underwriters are not going to be able to write everything that they send, but what agents really value is an underwriter who can work with the agent to move clients to where they want to be. If there’s not anything the underwriter can do on the price, they have to know the business well enough to suggest alternative coverage for different policy forms. Doing this effectively therefore, calls for a good knowledge of the industry, flexibility, willingness and availability.
Technology today has brought about a more purposeful work schedule which allows junior underwriters to do more of the keying and the processing, thereby giving relief to the senior members of the team to do more team-leading activities internally, or venturing out of the office to industry events and beyond. The present level of industry development has empowered underwriters to interact with agents more often. Such meeting created by this technological breakthrough, can be of tremendous advantage in the cross-selling and up-selling of products as well as product training.
Health Insurance; Why Insurers Place Limitations on HIV/AIDS Patients
Nigeria has a population of over 150 million people.  Out of this, the number of people that have tested positive to AIDS is staggering. Only recently, the Lagos state ministry of health reported that over 1 million people have tested positive in recent times. This is outside the old figures and the equally rising statistics in other states of the federation. Today, the number of people living with HIV or AIDS is awesome.
Insurance companies may be unwilling to cover a client who has tested positive to HIV or has a full blown case. AIDS is a silent and brutal infection and has a devastating effect on the financial lives of the sufferers. Research has shown that every single non-group medical claim policy issued in this country permanently excludes hospitalization expenses incurred due to any sexually-transmitted diseases including AIDS (although AIDS can be caused by other myriad factors other than unprotected sex.) It does not matter if you have a health insurance policy for years and didn’t claim a kobo for maybe a decade. If you get infected with the HIV virus in the 11th year, you will still not be covered for any hospitalization expenses incurred due to this.
Of course, to be fair to the insurance companies there are valid reasons for the exclusions of HIV/AIDS.  This is not unexpected especially against the background that 25 years ago, it was strange to hear of any such disease which has defied all medical researches aimed at finding a cure. The expenses required for treatment and eventual outcome is uncertain. The insurance industry depends on statistics about how many people get infected by the disease as well as the average cost for treating such a disease. This is also inclusive of eventual outcomes to guide in prizing appropriately. Therefore, since no reliable data is available on this, it is not surprising that it is excluded from the scope of coverage to avoid making the cost prohibitive. In fact, one of the insurance companies who spoke with this writer explained that while doing research on this subject, diabetics gave an interesting example whose insurance coverage under the health insurance plans in western countries, is variously accessed and usually very expensive.
Using this as an example, it can be clearly expressed that there is a second stage in health insurance where at least expensive insurance is available. Since HIV/AIDS is such a big issue the government would do well to create some kind of a common re-insurance pool just like it has done for certain categories of insurance such as oil and gas underwriting cover, without which the cost of covering this risk is likely to be prohibitive. Meanwhile, the insurance industry is doing its bit by having co-operative talks with some Non Governmental Organizations (NGO) under this subject. The result, though small, compared with the threats of the disease is at least providing some relief to victims, especially in meeting their treatment needs.
However, when insurance coverage for AIDS is viewed alongside other sexually transmitted diseases, one could understand why other STDs sometimes get the attention which AIDS patients don’t get. Statistical data on these lesser diseases is widely available and treatment protocols and outcomes are reasonably reliable like any other non sexually transmitted disease. Most insurance companies expressed concern that the reason this is so is because it flowed from previous mind-set that has been around for decades. At that time, the popular attitude was centered on the fact that somehow sexually transmitted diseases were immoral and hence anybody getting hospitalized due to them deserves not to be covered for the expenses. On the other hand, insurers probably felt that it was very expensive at that time to treat other sexually transmitted diseases which was perhaps acceptable.
It would be fitting if the National Insurance Commission (NAICOM) and the National Assembly could have regulations aimed at revisiting the entire subject of permanent exclusions. By permanent exclusion, we mean diseases that will not be covered irrespective of how long you have been insured compared with standard permanent exclusions such as congenital defects, cosmetic or obesity treatments, non allopathic treatments which are allowed under various regulations. If any insurance company wishes to expand the list it should be allowed to do so as long as an easily understandable communication is made to a prospective consumer and his prior informed assent obtained.


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Nigeria CommunicationsWeek believes that technology makes life more exciting and helps improve the lives of people around Nigeria and indeed the world. So since 2007, we have devoted our energy to independent reportage of technology and how they affect lives.

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Nigeria Economy – A New Quarter but Same Old Story



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By Lukman Otunuga, Senior Research Analyst at FXTM,

Africa’s largest economy entered the new quarter with a strong likelihood of following the same old story, namely COVID-19 headwinds, recessionary trends and widespread local and global market uncertainty.

What are the chances of a plot twist?

In a year full of twists and turns, the Central Bank of Nigeria (CBN) surprised investors with a 100 basis point interest rate cut from 12.5 percent to 11.5 percent. The monetary policy signal is a green light for more affordable lending which could stimulate economic growth and temper recessionary pressures. However, the same green light could speed up the inflationary pressures which weigh on the economy.

The currency markets may view the CBN’s rate cut as a sign that monetary policy no longer prioritises foreign investors seeking high returns on deposits.

Until now, the CBN’s hawkish monetary policy helped to maintain and grow the banking system’s foreign currency reserves, providing the Naira with a cushion against further weakness. The current weakening global and domestic economic outlook does not support a high-interest rate environment in the short term. Faced with a protracted recession or runaway inflation, the CBN appears to have chosen the lesser of two evils. The central bank’s latest statement indicates that high interest rates have not been successful in checking inflation, which the CBN blames on structural factors like rising fuel and electricity prices.

This raises the question of why an Oil-producing country faces inflation in fuel and electricity prices when fossil fuels are locally produced and ought to be more affordable. The answer is the strange economic distortion created by COVID-19. In this case, Nigeria applied to borrow $3.4 Billion from the IMF in order to bail out the economy because of the COVID-19 pandemic. The money will have to be repaid – cue a hike in electricity tariffs to increase government revenues from utilities and bolster its repayment capacity. This would be credit-positive as the last thing Nigeria needs in such extraordinary times are doubts over its creditworthiness.

Weaker global Oil prices make Nigeria’s creditworthiness even more of an important factor because the state is hard-pressed to cover its budgetary needs in the current climate of low demand for crude Oil.

Now that the CBN has put checking inflation lower down in its priorities, does this signal further rate cuts in the near future?

The case for further pandemic-driven rate cuts appears to be strong. The COVID-19 outbreak shows no signs of abating. On the contrary, at the time of writing, the number of new cases in Nigeria is on the rise after lockdowns eased. Further monetary stimulus to the economy appears unavoidable.

Of course, it all depends on what happens with inflation. If the inflation rate keeps rising in sectors like fuel, electricity and food it may drag on consumer spending, outstripping the economic benefits of lower interest rates. Medical costs have also risen because of COVID-19, according to the August inflation statistics.

The pandemic comes at a time when Nigeria is exposed to external and domestic risks. Locally, the drive to diversify the economy stayed stuck in first gear. Border clashes between herders and farmers led to border closures, further dampening economic activity. Externally, Oil prices remain in a slump, the US Dollar is appreciating and global sentiment struggles with the COVID-19 circumstances.

Further elevating fears over a technical recession in Nigeria, the World Bank forecasts an economic contraction of 3.2 percent for the full-year 2020, a five percent drop from its previous projection.

Summing up, Nigeria’s outlook remains influenced by the same old themes. If Oil prices stay depressed, foreign currency reserves and government revenues will likely decline. Low Oil prices also impact the CBN’s capacity to defend the Naira. A falling Naira could accelerate inflation and further weigh on economic growth. Will the final quarter of 2020 see a continuation of these themes, or will the economy offer a positive surprise?

The banking sector remains a bright spot in the cloudy outlook. Easier borrowing terms might boost the banking sector’s income while encouraging economic activity. Another bright spot is that growth in China has returned, promising to hike demand in the Oil markets and further supporting Oil prices.

After the year we’ve had so far, one thing’s sure: surprises are only to be expected.

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FG Mulls Renewable Energy for Improved Power Supply



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Dr. Ogbonnaya Onu, minister of Science and Technology, has said that the federal government plans to diversify the country’s energy supply sources to include renewable energy towards accelerating socio-economic development.

FG Mulls Renewable Energy for Improved Power Supply

Dr Ogbonnaya Onu, minister of Science and Technology

Onu stated this when he declared open the forum on ‘Scaling-up interconnected mini-grids development in Nigeria’, ‎organised by the United Nations Development Programme (UNDP-GEF) and the Energy Commission of Nigeria, in Abuja.

He said that renewable energy will help the nation meet its electricity needs in a functional and sustainable manner, adding that it will also improve the quality of life in the country.

‎“Nigeria is endowed with substantial energy resources such as coal, crude oil and natural gas; renewables such as hydro, wind, solar, geothermal, waves and tides, as well as biomass.

‎‎“The challenge before us, has always been on how to efficiently transform these resources into adequate and reliable energy for national development using our enormous capacity in science, technology, innovation and entrepreneurship”, he said.

The minister explained that since the inception of the present administration in 2015, electronic power generation capacity had increased at an annual rate of about 390 megawatts per year.

He, however, said that while this is commendable, it could not adequately meet the needs of the country’s population and sustain the desired level of economic development.

Onu further observed that Nigeria’s desire to industrialise cannot be realised without adequate power supply.

He stressed that every effort must be made to ensure that homes, offices, factories, schools, hospitals and laboratories in the country have adequate, reliable and affordable electricity supply.

“Renewable energy could meet Nigeria’s energy needs in the area of job creation and improved standard of living in rural areas,” he said.

He added that the development of solar photo-voltaic (Pv) in the country triggered by increase in demand for rural water supply, lighting, health services and micro-enterprise needs to be regulated to stimulate private sector participation.

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ROAM Africa Reports Over 2,400 Candidates Applying for One Role as Jobs Stiffens



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ROAM Africa (Ringier One Africa Media), the leading digital classifieds group in Sub-Saharan Africa, has released figures that highlight the current state of the jobs market in Africa, with one standard role attracting 2,417 applications.

Analysing 69,511 jobs listings from January 2019 to August 2020 across 5 African countries (Nigeria, Ghana, Kenya, Tanzania and Uganda), ROAM Africa’s data sheds more light on the challenges facing both job seekers and employers in the African jobs market.

The standard job listing that attracted 2,417 applications was for a Receptionist/Admin Assistant in Kenya while another listing for call centre agents and team leaders attracted 2,283 applicants.

Similar is observed also for other markets: In Ghana, 2,299 people applied for an Administrative Assistant role and 2,265 people in Tanzania applied for a Sales Representative role.

In Nigeria, the highest number of applications for a single role was 2,095 and it was for a Sales Representative role.

According to ROAM Africa’s data, Kenya contributed the highest amount of new job listings in 2019 with 33%. Nigeria was in second place with 31% and Uganda was in third place with 17%. However, so far in 2020, Nigeria is leading the way with 40% of new job listings, with Kenya in second place with 28% and Uganda in third place with 13%.

A closer look at ROAM Africa’s data reveals that, apart from Nigeria, there was a drop in overall job listings across all job levels during the last months.

However, there was an increase in graduate trainee and ‘no experience’ roles in Nigeria, Tanzania and Ghana from May to July 2020, which offers some hope for new entrants into the jobs market.

Interestingly, recruitment agencies contributed the most roles, with 16% of overall jobs, closely followed by IT and Telecoms with 15% and Advertising media and communications with 12%.

Some candidates have also reported applying for more than 20 jobs a day for multiple months and only getting to the interview stage on a handful of occasions. This is why ROAM Africa’s jobs platforms Jobberman (Ghana and Nigeria) and BrighterMonday (Kenya, Uganda and Tanzania) are focused on matching technology.

The company’s technology helps employers to identify and score the right candidates faster. Suitable candidates are made visible to prospective employers, and helped across the finish line by providing data driven career development tools and training programmes.

Job seekers using the platforms can expect to improve their CV, gain interview tips and sign-up for online training courses designed to bridge the gap between education and employment.

Commenting on the data, Clemens Weitz, CEO of ROAM Africa said, “The high ratio of applications per job listing really highlights how challenging the jobs market is for employers and job seekers.  Both employers and job seekers are struggling to connect with the right opportunities and more needs to be done to address this.

“Employers must rethink their hiring strategies and clearly define what they are looking for, based on data and insights. Job seekers must also invest in personal development that will make it easier for them to stand out in such a crowded and competitive market.”

Weitz also added that, “We believe that Africa’s greatest asset is its people and their entrepreneurial spirit. With the expected growth in the continent’s population, we must begin to put structures in place that will make it easier for African businesses to make the most of this resource.”

According to Hilda Kragha, Managing Director of ROAM Africa’s Jobs platforms, “With the current state of the jobs market, Africans cannot afford to continue with the antiquated recruitment processes that are commonplace in many organisations.

We must prioritise a digital approach to recruitment, which brings transparency to Africa’s labour market while connecting people to work opportunities that will improve their livelihood.

We must also embrace objectivity in the recruitment process by incorporating innovation that makes it easier to fairly and consistently sort for the best candidates. This will ensure that only qualified candidates are applying for roles and employers get an accurate picture of jobseekers’ capabilities. A win-win for both job seekers and employers.”

“Our data highlights both the challenge and opportunity that come with the African jobs market. We must address the challenge of rampant unemployment but also embrace the opportunity to transform how recruitment is done. By doing this, we will not only be addressing the current problems but also future-proofing our businesses and organizations for generations to come.”

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