Insurance pricing which up and until Covid-19 pandemic, has witnessed an avalanche of free endorsements for several standard policies and also, spiral down pricing of risks. This is already delivering a knock on operations, and professionals are nursing a review of free endorsements.
There are strong indications that insurance companies which granted such free endorsements for standard motor policy and fire will beat a retreat when policies are renewed in the new year or any new policy coming after #EndSARS protests.
The group managing director, Consolidated Hallmark Insurance Plc, Mr. Eddie Efekoha, in the opening remark at the novel “Time-Out With Our Partners” webinar, hosted by the general business insurer in Lagos, said the pandemic is pointing to business sustainability and those companies that want to remain in business should take a cue.
Laying emphasis on business continuity at the reinvented fraternity with insurance brokers, he made them to understand that keeping insurance companies in business should be part of their business concern. During his narration on the feat of long established companies, he said sustainability was the watch word that such firms that scaled the century mark etched into their business models. He said those that want to remain in business but have not stayed as long as the century plus companies, should be following after their business sustainability foot prints.
Expressing his knack for business longevity Efekoha said: “If you want to get beyond 100 years the subject matter of sustainability will come into the equation. CHI is already imbibing the idea and we find it useful.”
The topic for the novel engagement was “The Importance of Business Continuity Management in The Era of Disruption,” and Efekoha reminded insurance professionals present that before the #EndSARS event “we granted riot and strike free as an extension to standard motor policy. We know better today.”
Aligning with his submission to cease free endorsements, he inferred that continuing would be tantamount to boring a hole underneath ones boat. He therefore, stressed that it would be unwise to raise N10b for capital and use it to grant free cover for riot and strike at a time of pandemic or whatever pandemic that might still come in the future.
The CHI helmsman said free endorsements was no longer feasible because “the environment we live in is tense” and “we need to preserve investments and price risks very well.” He said those companies that regularly offer cheap cover because of the large number of competitors would find it difficult to meet claims demand in the aftermath of #EndSARS driven protest.
Efekoha therefore, advised insurance operators to reengage the principal underwriting spices that define the right pricing of risks and halt the downswing. Succinctly, he said, “Sustainability means you are doing things professionally. For your business to be sustainable you must do things professionally because any business including insurance has its own rules and we need to adhere to those rules.”