Learning to read could mark first step in growing the Nigerian economy

A poor literacy record across the country is holding back Nigeria’s potential, warns Yomi Onifade, Divisional Director, Retail Business Division of Axa Mansard Insurance. Speaking to around 100 delegates at the recent Risk Frontiers West Africa: Changing the risk landscape event in Lagos, Mr Onifade admits: “One of the things that jumps out from the figures is that Nigeria, which is the leading economy in Africa, has a literacy rate of 59%, compared to South Africa where it is 94%. “In fact, looking at the top economies on the continent, most countries, with the exception of the Ivory Coast, have a higher literacy rate than Nigeria.” The questions this raises, he says, includes whether the literacy rate is ultimately holding back the economy.hide“Is barely 60% good enough with what we are trying to achieve within our economy?” he asks. Mr Onifade also takes delegates through the numbers in regards to GDP per capita and also of insurance penetration rates, again asking whether the low level of literacy is impacting on both these sets of figures. He compares the figures to other emerging markets around the world—none of which show the Nigerian figures in a good light. Taking this to the insurance markets, he points out that India has some 450 actuaries working in the insurance space while South Africa has 300—Nigeria has just 19, including 10 Fellows. “How can just 19 actuaries drive the industry forward to move insurance penetration?” he wonders. “These are some of the questions we need to be thinking about. They show a clear picture of the challenges we face. “We have a lot of Chartered insurers in Nigeria but, at this point, do we need more Chartered insurers, which is something the regulators like to see, or do we need more actuaries?” Without actuaries, he suggests, it is hard for insurers to analyse the data and make rating decisions. It also makes it much harder for the sector to drive into new market areas or new regions of the country. Worse still, he warns: “Our life tables are still based on UK lives—how can we better price those risks when we don’t even have figures for our own country? How can we adequately select the right level of reserves? Can our models reflect customer behaviours?” Mr Onifade acknowledges the efforts some firms are making to drive up skillsets within their organisations and a show of hands around the room suggests more practitioners are mentoring younger members of the team than were mentored themselves. All good news, says Mr Onifade, but he wonders whether there is enough being done centrally to ensure the sector is properly resourced for the future. For example, his firm has identified the lack of actuaries and has set up an internal programme with a team of 20. A further nine members of staff have recently joined the programme but in a country of 180 million people, Mr Onifade still sees this as a drop in the ocean. The question of training is also raised by Jacob Adeosun, President of the Risk Managers Society of Nigeria (Rimson). “We must have specialist people who are trained in risk management,” he stresses. “We must have the right people in place who can apply the controls that are necessary for the risks faced by that particular organisation. Upskilling people is key.” He explains that Rimson has a programme in place to ensure its members are sufficiently qualified and certified. His words are echoed by Olayinka Odutola, Director General and Chief Executive Office of the Association of Enterprise Risk Professionals, who warns: “A lot of people call themselves risk managers who do not know much about the role. “As a professional body we need to bridge that gap in risk management practices.” He continues that, while qualifications may exist for some elements of risk management, it is essential practitioners have the chance to qualify in all areas of risk management, if they are to take a more serious role in any business. Mr Olayinka says it is crucial practitioners develop as markets develop around them and, in particular, as regulators demand ever more from organisations.

Learning to read could mark first step in growing the Nigerian economy

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