The effects of the Covid-19 Pandemic on insurance business

The effects of the Covid-19 Pandemic on insurance business

The economy across the globe has been greatly affected due to the outbreak of the coronavirus (COVID-19) pandemic. This has been a source of concern to the top insurance brokers as it is gradually causing them huge losses.

The Chief Executive Officer, Plum Insurance Limited, Barrister (Mrs) Laide Osijo, explained that the lockdown has greatly affected insurance brokers negatively, in the sense that getting fair insurance deals has become so difficult.

According to her ,business during the month of April was very slow and she hope things would improve during the month of may.

However, she noted that there is still a positive side to the lockdown as it has enabled them to leverage on technology and thus, some clients are already giving instructions to brokers through mails, these instructions are later passed to underwriters for processing.

Also, Itoya Moses, the General Secretary, Association of Registered Insurance Agents of Nigeria (ARIAN), noted that the rapid spread of the Covid-19 virus has caused novel effects on the global economy.

According to him, the movement restriction has affected them both negatively and positively.

On the negative side, he revealed that the rate at which they receive premiums on new business deals have drastically dropped, while already existing policy holders are no longer eager to pay their premiums.

He noted that the average insurance company would have to reduce its monthly budget and that closing new business deals has become very hectic as most of the potential clients may not be able to make use of technology for some reasons such as; poor eletricity, lack of enough data, etc.

He also advised insurance companies to deploy different technology channels for business transactions just like the banks to aid their agents due to the earn-as-you-work policy being adopted in the industry.

He said that in this trying period, some unethical agents may resort to cheating the unsuspecting clients in one way or the other because things would be really difficult thus, the need to render maximum support to agents.

He also expressed his confidence that the business would go back to normal and probably become even better after the movement restriction. This he said is due to the fact that before the covid-19 pandemic, business had been relatively favourable and that they have been working really hard to make sure business is improved post-covid-19 pandemic.

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